It’s no secret that financial goals can be daunting. Having grand ambitions, such as paying off your mortgage or retiring early is admirable. But, at the same time, some of these goals can sometimes feel distant and overwhelming.
Imagine there was a bridge that connected the excitement of a quick win with the distant shores of a long-term goal. Well, fortunately, there is.
A medium-term financial goal is something you want to accomplish in one to five years, such as saving for college, purchasing a car, or starting a business. As a result of these goals, you are usually exposed to moderate risk, which means that your income, expenses, or returns may fluctuate. If you want to achieve your goals, you must plan your income and expenses and invest part of your money in a diversified and flexible way, such as a mutual fund or a CD.
You can think of medium-term financial goals as your trusty sailboat. You achieve a clear, attainable goal by guiding you through economic uncertainty.
With that said, let’s look at how to chart your course with medium-financial goals successfully.
There’s no denying the importance of goal setting. Despite what you might think, goal setting is positively associated with success. The reality is that without a goal, life tends to get in the way of you achieving your potential.
The question is, why bother setting mid-term goals if you have already set short-term and long-term ones?
In short, with medium-term financial goals, you’ll find the perfect balance between:
Overall, the concept of a mid-term goal is to break down the marathon mentality of long-term goals into smaller, manageable components. As a result, you will have a greater chance of success in the long term if you set appropriate mid-term goals.
Additionally, according to a 2023 survey conducted by the American Psychological Association, money and the economy were the top stressors for Americans.
It was reported in August 2023 that Americans had a total credit card debt of $1.03 trillion in the second quarter of 2023, a record high.
It is possible to alleviate this stress by facing your financial reality head-on, setting clear goals, and staying on track with them.
Is it possible to identify your own financial north stars? Absolutely. And here’s a compass to guide you:
Now that you have identified your goals, it is time to turn them into actionable steps:
Managing your finances requires reliable tools, just as it does for any seafaring adventure:
Despite smooth sailing, rough seas are part of every sailing trip. You should be prepared for:
When you arrive at your medium-term destination, savor the success. Don’t forget to recognize your dedication and hard work. Now that you’re more confident and experienced recalibrate:
A medium-term financial plan can help you make your aspirations a reality. As a result, discipline and confidence are fostered, paving the way for the pursuit of financial freedom in the future.
Further, you will most likely get lost when you set sail without a destination.
So, what are you waiting for? Start charting your course, raising your sails, and advancing toward a brighter financial future. Watch your financial dreams come true as you define your goals and embrace the journey.
What are medium-term financial goals?
A medium-term goal typically spans 1-5 years and bridges the gap between short-term (less than a year) and long-term goals (5+ years). They can help you build wealth, improve your financial standing, save for a down payment, or take a dream vacation.
It can also increase your financial discipline and confidence to accomplish even a few medium-term goals.
Your specific situation and aspirations will significantly influence your choice of effective medium-term financial goals. You might be inspired by these examples, however:
Each person has different circumstances and aspirations, so there will be no one-size-fits-all solution for achieving medium-term goals. If you want to set your own financial goals, consider your values, financial priorities, and risk tolerance.
Image Credit: Tiana; Pexels
The post Setting Sail for Success: Charting Your Course with Medium-Term Financial Goals appeared first on Due.
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