How to Balance Short and Long Term Financial Goals
In an ideal financial world, we would all have decent bank balances, solid investment portfolios paid off at home, and no debt. In fact, it is difficult to see how even one of these goals will be realized, let alone all of them at once.
One way to actualize some of these dreams, MyFabFinance ‘s Tonya Rapley Says Call Your Girlfriend Ann Friedman in this podcast episode to have short-term goals that feed into your long-term goals.
“I think your goals should align, I think your goals should align with each other,” Rapley says. “Honestly, if you have a one-year goal, I think it should be part of your five-year vision and help you achieve your five-year goal.”
Rapley goes on to explain how her goals developed when she launched her website, MyFabFinance :
“My five-year goal was to … really get the opportunity to experience maternity leave and get the experience I wanted. So next year’s goal was to build a profitable business and generate income in X, Y, Z, and then next year’s goal was to actually work in that business full time. And the next year, since I was living in New York and refused to have a child in New York, the next year I was able to move and leave New York. And then the next year it was like, “Okay, we’ve done all of this, and now we’re saving money for this kid, but these goals are all geared towards each other.”
If you plan on buying a home in five or 10 years, then your goal for next year may be to save on the down payment by living with roommates and then build your career so you can relocate for less. … three years. These are short-term goals, but they will all help you achieve what you want.
Of course, not every goal you set for yourself needs to turn into something more ambitious. But it’s a reminder that everything in your money is connected. Minor decisions can make a big difference (see: retirement , fees , etc.). Paying attention to your overall financial health and not just one component of it is one of the most important things you can do.
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