Whether you’re saving for a down payment, a car, or a rainy day, a financial plan is the road map that will take you to where you want to go. Create your financial goals with these tips. The first step is understanding how you spend and save today. Listed below are tips to help you.
Get Started With Your Financial Goals
- Start with what you have. Make a list of all the ways you currently save: savings accounts, certificates of deposit, money markets, investments. Next to each item, write the balance in that account.
- Write down what you owe. Debt is a financial tool, but having too much of it is stressful. Add your debts to the list of financial goals: car loans, student loans, home loans, outstanding bills, money borrowed from a friend. Next to each item, write the amount owed.
- Create a budget. A budget is simply a list of income and expenses, but it puts you in control of your finances. Make your budget on paper, in a spreadsheet, or in an app — whatever is most likely to become a habit.
- Focus on paying off debt. Some people work from the smallest debt to the largest. Others start with the loan that charges the most interest and work their way down. Make this part more fun by challenging someone to a friendly competition to see who get can out of debt faster.
- Clean your financial house. Review your latest checking and credit card statements. Look for automatic payments for memberships and subscriptions you no longer use. Cancel them, then put the extra money toward debt. This is a great step toward your goals. Don’t forget you can check you credit report for free once a year.
- Set yourself up to win. Some expenses can sneak up on you, whether it’s something fun, like holiday giving, or something mandatory, like taxes. Make sure these are part of your budget, and put aside money for them a few months in advance so you won’t be caught by surprise.
- Don’t forget emergencies. Work toward saving enough money so an unexpected car repair or defunct refrigerator won’t ruin your week. Eventually, save enough to cover three to six months of expenses so you’ll be ready if a job loss or medical issue happens to someone in your household.
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Create Down Payment Savings Goals
Next up, think about a large expense you’re saving for, like the down payment for your dream home. Here are your next steps toward these goals:
- Do the math. Use our online calculator to test different dollar amounts until you find the right combination for your situation.
- Make your savings goals part of your budget. Monthly payments toward your goals get you that much closer to them and keep you from overspending on items you don’t need.
- Make savings automatic. If your employer pays you through direct deposit, see if they can put a portion of each check into your savings account. Otherwise, set up a monthly transfer from checking to savings so you save without having to think about it.
Taking the above steps to prep yourself for buying a home and achieving your goals will ensure a smooth transaction when you are ready to make your purchase.
This article was written by Rosa Ivey. When you’re ready to take that next step, contact me, Rosa Ivey. I can help you find the right type of mortgage to match your current needs and future goals. Plus, I can help you in any state across the U.S.
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