The summer is quickly coming to a close and parents and kids everywhere are looking ahead to school. Summer can be a lot of fun -- relaxing at times and exhausting at others. Expenses during the summer can vary significantly from those incurred during the school year. For some people that can mean a change in their monthly budgets for daycare, food, entertainment, vacation, and many other categories.
With school on the horizon, now is an excellent time to take advantage of the shift in schedules and expenses in order to reset your budget. But, I want to encourage anyone that wants to do so, to do so while also adjusting your habits so that they’re directly aligned with your financial goals. And if you don’t have any financial goals, by all means, create them!
“If you don’t know where you’re going, you’ll end up someplace else” – Yogi Berra
Almost everyone has financial dreams or wishes – whether they’re directly or indirectly financial in nature. Have you actually written your wishes and dreams down? Do they have specific numbers and timelines associated with them? If not, the general saying is "goals that are not written down are just wishes." Setting goals doesn’t need to be all that difficult. I'd submit that just about any goal is better than none. And frankly, we’re really never finished setting goals and marching toward them. Whether the goal is paying off a specific debt, saving for college, increasing your retirement savings, building an emergency fund, or all of the aforementioned, we all need goals. And, they all need to be time-bound and have specific numbers tied to them. These should be set based on some careful planning and thought.
The good news is that creating and striving towards just about any financial goal is going to move your Net Worth in the right direction. So, even if you fall short of your established goal, you are likely going to be better off than as if you had never taken the time to set goals in the first place. Of course, our goals should be consistent with our priorities – what’s important to us. And then our actions should be consistent towards working towards those goals.
Again, very soon kids will be getting back into the routine of school. Take advantage of this time, as well, by taking a fresh look at your existing financial goals. This might mean finally putting pen to paper and establishing them for the first time. Regardless, once you have set your goals, be mindful of your daily/weekly/monthly actions – basically where your money is being directed. Then determine whether those actions are consistent with your goals or if something needs to be adjusted, such as setting newer goals or modifying current behavior.