Finance Friday: Setting Financial Goals

Hello everyone! Welcome back to BirthMay 2022! Today’s post is the final Finance Friday for this BirthMay, all about setting financial goals!

In case you’re new, every May I blog every day and call it BirthMay! Why? Because it’s my birth month and I’m super extra.

I have been learning a ton about personal finance in recent years, as it was one of my “pandemic things” but it’s one of the few that stuck. I love learning about personal finance and sharing things I’ve learned on my blog. Of course, I have to include the disclaimer that I am not a finance expert and I am not a financial advisor so do your own research and figure out what’s best for you!

I love setting and meeting my financial goals, but it’s hard to know what is and isn’t realistic when starting out. For instance, when I was younger I would say my goal was to be a millionaire until I learned that wasn’t really enough for the life of pure luxury I was imagining (I mean, it is a lot of money but reading posts on if a million dollars is enough to retire on they all say no so…). Anyway, over the years I’ve gotten to learn more and so I wanted to share a few of my basic goals.

One of the easiest goals for me to set and reach each year is to max out my Roth IRA contributions. This is a retirement account that is super popular for anyone that qualifies as the money contributed has already been taxed, so when the time comes to withdraw the funds they are withdrawn tax-free. This account has limits to how much can be contributed each year, for me it’s $6,000 per year, and not everyone can qualify for these accounts (although there is the back-door Roth option), but if you can contribute it’s a great option. I’m honestly sad I didn’t start contributing to this type of account sooner! As I mentioned, I aim to max out the contributions each year and I try to do so right away on January 1st.

My next goal is to further contribute to my retirement. I don’t have a 401k yet at work, unfortunately. They only let us join in after a year, so I still have a few months to go. I’m thinking I’ll contribute as much as I can to get as close to the maximum contribution limit. I definitely won’t make it this year, but I’m hopeful I can get pretty close next year. If I wasn’t trying to also save for a house, I would probably prioritize it more.

Home ownership is definitely a goal for me. I could probably get a house with the funds I already have, but I haven’t yet because I also want to have a “house emergency fund” as I hear that there’s always something to fix around the house. Plus, I just like having a big cushion. I have started casually looking and going to open houses, but even then I don’t know if I want to stay in my area or move away. There’s so much to consider!

I also have a very specific goal for my net worth right now. I have heard on witchy TikTok that if you pick a specific number then your mindset limits you to ONLY that number, so that is a new concern of mine I suppose. But it is good to have a goal to work towards in my opinion so I keep my goal with the intention of changing it once I reach it.

Some previous goals that are more beginner friendly that I’ve already reached include setting up a budget, saving up emergency funds or starting to invest. I’ve already chatted about those in full posts so I won’t go too much into those now, but a budget is key to meeting goals. An emergency fund can really help in times of need so not all progress towards other goals is lost. And investing is a great long-term way to reach those goals.

No matter what the goals are, I’ve found that it’s important to make realistic and attainable goals to stay motivated and on track!

Thanks for joining me on another Finance Friday and I hope these posts helped out!

Thanks for reading!

Pamela

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Finance Friday: Setting Financial Goals – A BirthMay Post