The Benefits of Setting Financial Goals

6/27/2012, 1:32 p.m.

If you don't know how much you are saving or when you will be able to retire, it's time to look at the benefits of setting financial goals. It's important to look at what your future plans are, how much you can contribute to them, and how you plan to manage and grow your wealth. By working with a financial advisor to formulate a plan, you can be secure in the knowledge that your investments are growing appropriately and that you will be able to retire comfortably when you are ready.

Financial Goals in a Tough Economy

The economy is tough right now, and many people are cutting back on their savings and investments. At the same time, with stock prices dropping, many stocks and funds can be had for a very low cost. While no one can guarantee that they will rise in price, a qualified financial advisor can help you to determine you best bets. No matter how much cash you can spare these days, there are investments that you can make that will put your future in good stead. The benefits of setting financial goals don't have to go by the wayside when times are tough. Now, more than ever, you need to stick to your plan.

Visualizing the Financial Future

Now that we are discussing money, what are your goals? Do you want to retire in ten years? Do you have kids to put through college? Do you want to keep working but have the funds to take extensive vacations? No matter what financial goals you have, they take money, and for most of us, that means planning. One of the benefits of setting financial goals is knowing how much to set aside and how to grow it to meet your these goals. Planning how you see your future, however, is the first step.

Another important benefit of setting financial goals is that you get to reevaluate them. As time goes on your needs may change. You may love your job and not want to retire. Your daughter may have a full ride scholarship, and you won't have to pay for college. Your parents may need extra assistance in their golden years that you hadn't counted on. Life is always changing, and your financial plan should be flexible, as well.

Reassessing your goals means reassessing your investments, too. Riskier investments can pay off if you have a long time to grow a return, for example, but if you need a steady, reliable source of income, they may not be the best option. By reassessing your investments along with your goals you can make sure you are on the right track.

Moving Forward to Financial Success

There are many benefits to setting financial goals. You can plan for your future and ensure you'll have the security to retire when you want to. You can also reassess your goals and investments to make sure the plan for each is still what you need.

Along the way, it might be best to get some help from a qualified financial advisor to know for certain that you've made the best investments you can for your wealth. Life changes, and so should your plan--but if you account for this, you can make your goals work for you.

Questions? Email me at wesley@thewandwgroup.com and visit our website at http://www.thewandwgroup.com. New Money Talk is a weekly article focusing on retirement, personal finance, and estate planning.

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