Financially Preparing for Future Goals

by Krantcents · 18 comments

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Life is expensive and meeting various financial demands often calls for early preparation. Maybe you’re planning an upcoming vacation. Or perhaps you want to save for your kid’s college education or plan your retirement. Regardless of your life goals, here are tips to prepare your finances.

 

Planning a vacation

When was the last time your family enjoyed a real vacation? One year ago? Five years ago? Never? There is nothing cheap about a family vacation. Yet, this is the perfect time to relax and spend quality time together. Even if you’re living paycheck to paycheck, there are ways to make your trip a reality.

For starters, stop telling yourself that you can’t afford a vacation. Most people who travel aren’t rich – they simply know how to budget and sacrifice. Reaching for anything big requires a plan of action. For this matter, determine a destination for your family vacation. Next, estimate how much you’ll need for this trip. And lastly, develop a savings strategy.

Putting aside 10% of your income, saving your tax return and cutting expenses can provide the cash you need. Additionally, some families have had success with finding airline credit cards on this siteApply for a travel rewards credit card and you can earn miles for every $1 you spend. Redeem your miles for hotels, cruises, car rentals and airfare.

Don’t put off retirement

If you want to retire early and enjoy a comfortable life, it is important that you plan early. Don’t wait until your forties or fifties. The earlier, the better. As a matter of fact, some financial expert believe it’s important to open a retirement account in your twenties.

There are numerous ways to prepare for retirement. If your employer offers a retirement plan, take advantage of this and deposit a percentage of your pay into this account. Additionally, you might look into individual retirement accounts (IRAs). Likewise, it doesn’t hurt to build your liquid savings. Talk to your bank and explore your savings options, such as money market accounts, certificates of deposits and high-yield savings account.

Start saving for college

The idea of paying your kid’s college tuition may invoke panic. College is expensive. However, there are resources available to help you estimate the cost of higher education and plan accordingly.

Like planning for your retirement, don’t wait until your kid is a junior or senior in high school. If possible, start stashing money for college as soon as your kid starts grade school. Keep this money in a high-yield savings account to maximize your earnings, or look into 529 college savings plans.

Sure, there’s always the option of student loans. However, these loans can result in costly debt upon graduation. Not to say your kid shouldn’t take advantage of private or federal funding. But if you can save and cover most of his educational costs, this reduces how much he’ll need to borrow.

Looking into the future and facing your financial obligations can be overwhelming, especially if there isn’t a lot of cash to go around. But with a plan in place, accomplishing your financial goals becomes a lot easier.

Photo by:  Flickr

 

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{ 10 comments }

Andy Hough September 14, 2013 at 6:10 am

I’m currently saving over 50% of my net income and most of that is being saved for retirement. Since I got a late start on saving for retirement I need to do that. My vacations are pretty cheap so I can usually just cash flow them or take a small amount out of my cash savings.

Krantcents September 14, 2013 at 9:29 am

50% is a bit extreme! Consistency is more important than how much you save and invest.

Michelle September 14, 2013 at 6:26 am

We plan on retiring early. We are saving as much money as we can, lowering our expenses and working on increasing our income.

Krantcents September 14, 2013 at 9:31 am

Good for yu! What is your plan for retirement? When I reached financial freedom (late 30′s), I started a variety of businesses.

Pauline September 15, 2013 at 12:18 am

There are so many ways to travel cheap or almost free. I travel a lot and people imagine I am a millionaire but really I sometimes even spend less than they do at home. It just takes a little planning.

Krantcents September 15, 2013 at 6:54 am

I agree! I travel overseas first or business class using miles I accumulated.

Paul @ The Frugal Toad September 16, 2013 at 6:21 am

I started saving in a company sponsored 401k as soon as I started and have been saving for retirement since. I also budget for vacation each month so that I have the money when I want to take a trip!

Krantcents September 16, 2013 at 6:54 am

Starting saving early is one of the most important things you can do. I always liked saving for annual expenses every paycheck.

Anton Ivanov September 17, 2013 at 6:22 pm

Solid, timeless financial advice. Just like with almost everything else in life, it is better to plan ahead and start preparing early for big expenses, than scramble at the last minute. Or worse – go into debt because you failed to save ahead of time.

Krantcents September 17, 2013 at 7:45 pm

Planning can resolve almost anythiing! I attribute my success to planning, good choices and goal stating.

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