Imagine waking up one morning and realizing you’ve worked for years but have no clear financial path ahead. The years slip by, the dreams pile up, but your bank account doesn’t reflect the progress. Sounds stressful, right? Now, imagine a future where every step of your financial journey is planned—whether it’s buying your dream home, taking that long-desired world trip, or retiring early, stress-free. Financial freedom isn’t just a fantasy for the rich; it’s a reality anyone can achieve with the right strategy.
So why is it that we meticulously plan our education, career, or fitness goals, but when it comes to financial goals, many of us simply ‘wing it’?
The truth is, setting financial goals today can mean the difference between struggling through uncertainty and thriving with confidence tomorrow. Whether you’re aiming for short-term wins like buying that swanky car, or long-term goals like securing your retirement, the key is to start now—and to start smart. And in this blog, we’ll show you how to do just that, step by step.
Financial goals can be short-term or long-term. Short-term goals include saving up for buying a car, or for a holiday. Long-term goals are those that may take more than 10 years to accomplish. They include saving up for a child’s marriage, planning retirement, or funding a retirement business idea. But for these goals, the key is long-term investing.
Whatever the goal duration, planning is essential. We reiterate here that long-term investing in the capital markets can be the most effective way to plan your financial goals, whether for the short-term or the long-term. For short-term goals, you can look at assets that are less risky and give good returns over a small timeframe. Bonds and debt funds are some of your best bets. If you want to invest for the long term, long-term investing in the equities market will be the one you must go for. Stocks may have short-term volatility but give amazing returns over a larger period through long-term investing.
These are the basic concepts of financial planning and long-term investing. Where you will need help is in picking the right assets that will help you reach your financial goals. Savart can help you, and we will tell you how at the end of this article.
First, here are five steps for you to follow while planning your financial goals:
- Write down what you want to do in the next five years, ten years, twenty years, and when you retire. This will help you set some realistic goals for the short and long term. Long-term investing is crucial here for achieving those 10- or 20-year goals, especially for retirement planning.
- Be realistic. You cannot retire within five years if you are 25 years old and have not saved even INR 5 lakhs, so be realistic and set goals that have some probability of being achieved. Long-term investing allows you to grow your wealth gradually and reach those realistic goals over time.
- See how much money you can set aside every month for investing. This will help you plan your goals appropriately. Sometimes, if you do not have enough to invest every month, you are better off planning for the long term, instead of focusing on short-term goals. This is where long-term investing plays a huge role—the earlier you start, the more you can benefit from compounding.
- Plan your non-essential expenses around your financial goals. After spending on essentials such as food, grooming, rent, utilities, and EMIs, (Roti, Kapda, and Makan) set aside your monthly investment amount and then spend on your non-essential items. This habit reinforces the importance of long-term investing and sticking to your financial plan.
- Make sure you reduce your debts and increase your investments regularly. As you grow in your career and your income increases, make sure you clear off any debts you may have and do not take on any new ones. At the same time, increase your savings through long-term investing every month. This way, you can start having more financial goals, both short and long-term, and start saving for them individually.
These are some uncomplicated ways for you to plan for your financial goals. They will help you get started on your journey to achieve those goals through long-term investing.
Now, Savart can help you plan your investments and start saving for your financial goals. Our app allows you to add up to three financial goals, and it will also give you a monthly investment amount based on your goal’s target amount and duration. You will also get a customized portfolio advised to you that aligns with your lifestyle and helps you achieve your financial goals. Through Savart, you’ll gain access to portfolios optimized for both short-term gains and long-term investing, ensuring that your financial journey is on track.