| Setting your financial goals seems like an easy | | | | to consider housing and accommodation as well? |
| enough proposition, after all, you just have to | | | | In order to effectively calculate how much money is |
| determine what you want to accomplish at the | | | | needed to accomplish your financial goals, you have |
| intermediate level (three to five years) and the | | | | to make these goals as specific as possible. Further, it |
| long-term (five or more years). However, in order to | | | | is probably a better idea to make your calculations |
| do this effectively there is more to it than merely | | | | liberally, anticipating higher expenses than the current |
| saying what you want to accomplish, you have to | | | | costs indicate. The worst case in this scenario is that |
| keep track of how much it will cost to do so. Since | | | | you will have saved too much, which is much better |
| these are goals over an extended period of time, | | | | than the alternative. |
| some - if not all - of the factors that you took into | | | | Once you have your specific financial goals in spelled |
| consideration originally may have changed since that | | | | out, then it is important to keep track of the |
| original calculation. | | | | changes in pricing. If your goal was to purchase a |
| First, you have to be specific. It is one thing to | | | | home in Phoenix and you made your calculations |
| determine that you want to retire to Florida, but | | | | based on the going rate of property there in 2006, |
| there is an enormous difference between retiring to | | | | this going rate has probably changed radically by 2009 |
| North Miami Beach as opposed to retiring to inland | | | | thanks to the bursting of the real estate bubble. The |
| Tallahassee. Where, specifically, do you want to | | | | reverse is also true: if you are looking at sending your |
| retire? Related to this consideration is also the | | | | daughter to the state university and your last pricing |
| question of your minimum standards. Obviously, if | | | | of this was in 2000, you may be unpleasantly |
| you would be happy living in a small trailer park, the | | | | surprised to see how much tuition rates have |
| cost is significantly different than if you would only | | | | changed. |
| be satisfied in a gated retirement community. | | | | Setting financial goals involves more than merely |
| The same also applies to sending your children to | | | | making a wish list, it involves responsibly pricing your |
| college. Think of the incredible pricing difference | | | | specific targets and then keeping track of changes. |
| between sending your child to the local community | | | | Although pricing information used for many |
| college as opposed to sending him to an Ivy League | | | | intermediate goals, such as buying a new car or |
| university. The acceptable minimum standards again | | | | washing machine, do not necessarily change a great |
| come into play in this scenario. Are you considering | | | | deal, this is certainly not the case with longer term |
| just paying for tuition and materials, or do you need | | | | goals. |