Financial Goal Setting Tips and Examples
Use this as a quick guide to writing and organizing your financial goals. We’ve also included a big list of examples and real life examples to help you brainstorm and ensure nothing gets overlooked. From there, you can prioritize what matters most and start building your plan. We will also cover a few tips for setting goals effectively and strategies for hitting your savings targets.
Review of Short, Mid, and Long Term Goals
Most financial goals can be categorized as either short, mid, or long term goals. Before you write your own, let’s review the difference between them.
Short Term Financial Goals (1-5 years away)
While there is no set timeline for what makes a goal "short," "mid" or long term, short term goals are typically savings goals that you’d like to achieve within the next few months or few years.
Where Should You Set Aside Money for Short-Term Goals?
For money you plan to use within the next few years, a savings account is usually the safest option. Investing in the stock market comes with the risk of market downturns, which can significantly reduce the value of your investment over a short time frame. For example, imagine working hard to save $30,000 for a down payment on a house you plan to buy in 18 months, only to see that amount drop to $21,000 due to market fluctuations. With short-term goals, preserving your savings is more important than seeking higher returns, making savings accounts a solid choice.
Mid Term Financial Goals (5-9 years away)
I like to think of mid-term goals as goals that you may not be prioritizing right now with the money that you have coming in, but you want to keep top of mind as you plan for the future.
In some cases, you might have a short term goal that is related to a mid term goal on your list. For instance, if you want to buy a house within 6 years, you can estimate how much you want to have set aside to use as a down payment. In that case, you may start setting aside a set dollar amount per month so that you are able to hit that goal in time.
Long Term Financial Goals (decades away)
Long term goals are many years or decades away, for example, investing for retirement typically falls into this category.
Big List of Examples
This list is merely meant to give you ideas. Some of these simply don’t apply to your life vision. And some of the long-term goals might actually be mid-term or short-term goals in your situation, and vice versa. The timeline depends on when you want to achieve that goal.
Short-Term Goals (Less Than 5 Years)
Save up (or increase) an emergency fund
Set up a separate savings account for travel and contribute to it monthly
Save up for an upcoming trip or weekend getaway
Set up a separate savings account for pet/vet emergencies
Set up a separate savings account for gifts
Save for home repairs and improvements
Save to purchase a house or rental property
Save for a car purchase
Save for a wedding
Set aside money to buy new clothing or essential items
Declutter and sell my extra stuff for cash
Reduce or eliminate high-interest debt
Establish a monthly budget that works for me
Get organized with my bank accounts and credit cards
Max out my IRA (Individual Retirement Account)
Invest in my employer-sponsored retirement plan
Increase my 401(k) contributions to X% of my paycheck
Open a brokerage account and contribute $50/month
Automate my monthly investments
Improve my credit score
Invest in myself (e.g., a course, certification, etc.)
Read one investing book
Listen to 2 podcast episodes on how to invest
Start a side hustle or business for an additional income stream
Set aside savings for maternity or paternity leave and/or to prepare for a baby
Ensure that I have the right health insurance for my/my family's needs
Increase my 401(k) contributions by 1% every year
Reach $100k invested in my retirement accounts
Create a will or update estate planning documents
Save for a major home renovation or upgrade (e.g., kitchen remodel)
Mid-Term Goals (5–10 Years)
Purchase a house or rental property
Pay off all debt (and stay consumer debt-free forever)
Pay off all of my student loans (or some percentage/dollar amount of student loans)
Set aside investments for college tuition for a child
Start my own business or significantly grow an existing one
Take a sabbatical or extended time off for personal or professional growth
Save for a significant family event (e.g., milestone anniversary, large family reunion)
Achieve a certain net worth milestone (e.g., $100,000, $500,000, $1 million)
Fund a major life experience (e.g., extended travel, learning a new skill)
Complete advanced education or certification (e.g., MBA, Ph.D., technical certification)
Contribute to a significant charitable cause or start a charitable fund
Upgrade to a dream home or purchase a vacation property
Fully fund an emergency savings account with 6-12 months of living expenses
Build a portfolio of investments that generate passive income
Establish and grow a college savings plan for children (e.g., 529 Plan)
Save for a significant lifestyle upgrade (e.g., luxury car, boat, RV)
Long-Term Goals (10+ Years)
Reach financial freedom (where your investments generate enough income to cover your living expenses)
Become work-optional (no longer rely on a full-time job to support my expenses/lifestyle)
Pay off my home mortgage entirely
Retire early (at age 35, 40, 50, 55, etc.)
Be able to afford a comfortable retirement when I turn age 65
Build and protect generational wealth for my family's legacy
Fund a trust or endowment for future generations
Achieve a net worth milestone (e.g., $10k, $100k, $500k, $1 million, $5 million)
Travel the world extensively or live abroad for an extended period
Invest in real estate or other income-producing assets to create a diversified portfolio
Create and fund a charitable foundation or significant philanthropic effort
Pass on a business or significant asset to heirs or the next generation
Ensure my estate is well-planned and taxes are minimized for heirs
Fund a comfortable lifestyle in retirement, including healthcare, travel, and leisure activities
Leave a lasting impact through philanthropy or community involvement
Plan for long-term care and healthcare needs in retirement
Examples
Example 1: Solopreneur in Colorado
Average annual business income (owner’s pay) = $60,000
Rents a 2-bedroom apartment with a roommate in Colorado Springs, CO
Only debt is a car loan they own <$20k on at 4.5% interest rate
Short Term (1-5 years)
Short Term Goal #1: Move $10,000 of my savings to a separate high yield savings account for my Emergency Fund (already saved!)
Short Term Goal #2: Save $1,800 for an epic 5-day hiking trip in Grand Canyon National Park (6 months out). >>$300/month
Short Term Goal #3: Set up and start investing in a SEP IRA (25% of my business income)
Short Term Goal #4: Start setting aside money each month in a separate savings account to purchase a property in the next 5 years (start in 6 months, $400/mo).
Short Term Goal #5: Pay off the car loan within 5 years (about 54 months left), and have a plan in place to be consumer debt-free forever (<$16k left on loan at 4.98%).
Mid Term (5-9 years)
Mid Term Goal #1: Purchase first house (in the next 5-6 years)
(in the short term: review home prices, set a goal, start setting aside each month)
Long Term (Decades away)
Long Term Goal #1: Reach financial freedom and have a comfortable retirement by age 67 (35+ years out).
Example 2: Solo, full-time job with a side hustle
Salary job = $100,000 annual income
Side business = $50,000 on average annually
Rents a 1-bed apartment in Philadelphia, has a dog
They have $9,000 left on a federal student loan at 3.6% and pay the minimum on it each month.
Short Term (1-5 years)
Short Term Goal #1: Fully fund an emergency fund in a separate savings account ($10,000) by X/X/XX (Currently have $7,000 saved).
Short Term Goal #2: Save a separate Pet Fund for emergency vet visits and other related costs ($4,000 goal).
Short Term Goal #3: Save $3,000 for a trip to Portugal (8 months out)
Short Term Goal #4: Max out my IRA for this tax year ($6,500).
Short Term Goal #5: Save $15,000 for my future wedding (18 months out)
Short Term Goal #6: Set up a separate savings bucket for Gifts (special occasions, weddings, birthdays, holidays, etc.) and fund it w/ $1,500 before the next holiday season.
Mid Term (5-9 years)
Mid Term Goal #1: Pay off all of my student loan debt in 4 years or less.
Mid Term Goal #2: Save $40,000 to put towards purchasing first rental property by X/X/XX (6 years out, can shift monthly savings here as the other goals are achieved)
Long Term (Decades away)
Long Term Goal #1: Reach financial freedom and have a comfortable retirement by age 67 (30+ years out).
Example 3: Married with 1 kid
Married couple with 1 child, spouse #1 is a Paralegal ($55,000 salary), spouse #2 is a Mortgage Loan Officer ($65,000)
Owns house in Raleigh, NC
Short Term (1-5 years)
Short Term Goal #1: Build up our family’s emergency savings in a separate high yield savings account by X/X/XX (Currently have $10,000 saved, $20,000 goal).
Short Term Goal #2: Start setting aside money each month ($200/month) for an annual or every other year family vacation.
Short Term Goal #3: Max out both of our IRAs for this tax year.
Short Term Goal #4: Start setting aside $100/month towards a college fund for our child (14 years out from school, want to start setting aside $ in the next 12 months).
Short Term Goal #5: Set up a separate savings bucket for Gifts (special occasions, weddings, birthdays, holidays, etc.) and fund it w/ $1,200 before the next holiday season.
Mid Term (5-9 years)
Mid Term Goal #1: Build a college/post high school fund for our child (14 years out from college, $15,000 goal to give them a head start).
Long Term (Decades away)
Long Term Goal #1: Reach financial freedom and have a comfortable retirement together by age 67 (30+ years out).
Example 4: Retiring in the next 7-10 years
Short Term (1-5 years)
Short Term Goal #1: Increase liquid cash savings to 1-2 years of living expenses before entering retirement in 2030 ($XX,XXX)
Short Term Goal #2: Continue to max out contributions to retirement accounts (401(k) and IRA) annually.
Short Term Goal #3: Take a memorable vacation to a dream destination ($7,000 by Jan 20XX).
Mid Term (5-9 years)
Mid Term Goal #1: Begin downsizing and decluttering the home in preparation for retirement.
Mid Term Goal #2: Complete any outstanding home repairs or renovations ($8,000 budget).
Mid Term Goal #3: Complete any remaining big-ticket purchases (car replacement, major appliances, etc.).
Mid Term Goal #4: Develop a comprehensive healthcare and long-term care plan together with my spouse.
Long Term (Decades away)
Long Term Goal #1: Travel to bucket-list destinations and explore new hobbies during retirement (increase contribution to Hobbies and Travel savings account).
Long Term Goal #2: Continuously manage investments and adjust the retirement portfolio for growth and stability.
Long Term Goal #3: Establish a legacy plan, including charitable giving and estate planning.
Long Term Goal #4: Focus on health and wellness to enjoy an active and fulfilling retirement (increase spending in this category to $XXX/month)
Bonus Tips for Setting and Hitting Financial Goals
1) Write Your “Why” Statement
What is your “why?” Your why should encompass what drives you to start and continue along this journey towards financial freedom.
Example: I am committed to using money as a tool for building my wealth in order to have the freedom to do whatever I want, whenever I want, with the people I love.
PS: Feel free to steal the example if it resonates with you! You can always revisit this, and it will likely change over the course of your money life.
Tip: If you have a hard time getting down to the root of your why, write what first comes to mind. Then, ask yourself “why” a second time, and write your answer. You can do this a few times until you’ve gotten down to the good stuff.
To write your WHY Statement, try using this prompt: I am committed to using money as a tool for building my wealth in order to ______________________________________.