Tuesday, December 30, 2014

Setting Financial Goals For The New Year

As 2015 dawns upon us thoughts turn to those pesky New Year resolutions we all vow to keep. Many of those resolutions tend to involve losing weight, quitting smoking, or improving your financial situation. As an investor I'd like to focus on the latter.

We'd all like a better financial situation but what exactly does that mean? When giving the subject some thought it is key to define exactly what that involves. The following guidelines should help in setting financial goals:

- Write It Down: Studies have shown you are more likely to keep your goals AND achieve your desired results simply by writing them down.

- Set Time Limits and Benchmarks: Identify dates or time frames in which you wish to accomplish a specific goal. Deadlines will help you get started and give you something to aim for as well.

- Be Specific: Simply writing "I want more money" does not provide a focus. Instead your goal could be $240 of additional dividend income or $2,000 more in emergency savings. A specific goal is more likely to be met than a vague one.

- Make A Plan: Once a goal is identified there must be a plan to get there. How to get $240 of additional dividend income? Find the dividend stock or stocks you like, determine how many shares you need to get that $240, and determine a schedule in which you want to buy the stock(s). Maybe you want to buy enough each month to get an additional $20 of income. Perhaps fewer but larger purchases meet you needs.
Setting goals is a must for the investor

As an example I will share one of my 2015 financial goals and how I will get there.

I like silver. Physical silver. I like it as a small part of my investment portfolio, as a collectible, and as something I might eventually pass down to my children. I will increase my silver holdings by a minimum of 10% this year. I have a trusted dealer I purchase from. I like one ounce coins, specifically Canadian Maples and American Buffaloes. I will buy enough coins to increase my holdings at least .085% each month. I know how many ounces of silver I already own and have determined how many ounces (coins) I will need each month.

My plan is written down, it is specific (10% increase in holdings), I have time limits (every month) and I have a plan (specific purchases each month).

Setting goals is key to improving and moving forward and financial goal setting is no different.

The only person standing in your way of making 2015 your best year ever is you. Make it your year.

The opinions presented here are mine and not meant as financial advice or a recommendation to purchase a specific investment. Do your own due diligence.

More thoughts and ramblings on twitter @MattBellWrites