When Kristen and I started out we had lots of dreams (and still do) but we quickly noticed that we needed to write down our goals if we wanted to achieve them.
Some of the goals that we wrote down were really short term goals like buying furniture for our apartment while others were a little further out like saving for a down payment on a house.
When setting goals for the first time as a couple it can difficult to reconcile all of the things that you want to accomplish.
The key is to identify the three types of goals and then prioritize them.
Very generally goals can be broken down into short, medium and long term.
Short term goals are those goals that you would like to achieve in the next 6 to 12 months. Make sure that you are realistic here.
If you set goals that can’t be accomplished within the year you will get frustrated and it will hamper your effort to achieve all your goals.
Short term goals can also be your long term goals broken down into smaller pieces. For example you may have a long term goal of getting out of debt. A short term goal under this could be to pay off a specific credit card or a student loan.
Breaking larger goals into smaller pieces will keep you motivated as you drive towards your dreams.
Short term goals could be things like paying off a credit card, saving for an emergency fund or taking a family vacation.
Make sure that you set dollar amounts and deadlines for each of these goals.
Medium term goals are those goals that you would like to achieve in the next 1-3 years.
Medium term goals could include things like getting out of debt, buying a house or starting a business.
One way to tackle your medium term goals is to begin working on them alongside your short term goals.
If you goal is tied to saving a certain amount then begin setting aside that money as you work on your short term goals.
Another way is to make your short term goals smaller parts of your medium term goals.
Long term goals will be those things that are out farther than 5 years. It can be difficult to think of goals so far out but it is important to being thinking about these goals while you are starting out.
Every little bit that you are able to save and invest while you are young will pay large dividends over time. It has the benefit of time and compound interest.
Long term goals will be things like saving for your children’s college or saving for retirement.
Similar to your medium term goals I think it makes sense to begin working on at the same time as your short and medium term goals.
With all goals you want to work backwards to find out how you will reach them.
For example, if you want to save $20,000 for a down payment on a house in 3 years how much do you need to save each month to achieve this? ($20,000/ 36 months = $555). So if you save $555 a month you will have your house down payment in 3 years.
For retirement it will be a little more complicated as you will be investing your money and the earnings and dividends will add to the final amount. But that is for another post.
Take some time to identify 3 long term, 3 medium term and 3 short term goals that you would like to accomplish and write them down.