Financial Goal Examples: Short-Term, Long-Term and Everything in Between

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By setting specific, measurable and achievable goals, you can take control of your finances and improve your overall well-being. These financial goal examples show how short-term, mid-term and long-term plans can work together to help you stay focused, motivated and on track — whether you’re paying down debt, saving for a home or preparing for retirement.

What Are Financial Goals?

Financial goals are objectives that you set for the future based on your current financial situation.

For instance, someone who has a $100,000 net worth may strive to reach a $1 million net worth within the next 20 years. You can set different goals and adjust your deadlines based on your income, expenses and other details.

It’s good to set financial goals around your nest egg, but that’s not the only part of your finances that is worthy of goal setting. You can also establish objectives for your income, budgeting, paying off debt and establishing an emergency fund.

Common Financial Goal Examples

While everyone might have different financial goals, here are some of the most common ones.

Make a Budget

Creating and following a budget can be a great way to take control of your finances. A budget allows you to track your income and expenses and see where your money is going.

It also helps you identify areas where you can decrease your spending and redirect that money toward other goals.

Pay Off Debt

If you want to pay off debt, set a specific goal to pay off a predetermined amount by a certain date.

The avalanche method is a good place to start. With this method, you pay off debts with the highest interest rates as quickly as you can.

Keep In Mind

When setting financial goals, it is important that they are realistic and achievable.

For example, if you set a goal to pay off $50,000 of debt in one year, but you only make an annual salary of $35,000, that goal is probably not realistic.

Instead, set a goal to apply a percentage of your monthly income to debt repayment.

Build an Emergency Fund

An emergency fund is a savings account set aside specifically for unexpected expenses or financial emergencies. Without this safety net, you might have to take on debt or rely on credit cards when emergencies arise.

Having an emergency fund can also give you peace of mind, knowing that you have a cushion to fall back on if something happens unexpectedly such as a job loss, a medical emergency or car or home repairs.

Financial experts recommend having an emergency fund that can support at least three to six months’ worth of living expenses. This way, if you have a temporary loss of income, you will have enough money to cover your basic needs until your income is restored.

Decide on an amount that is comfortable for you and your family, and set aside a percentage of your income every month until you achieve it.

Investing for the Future

If you are not already saving and investing for retirement, it is not too late — this year can be a great time to start.

Even if you have a 401(k) plan through your place of employment, you can still set aside additional money in an IRA account. Setting aside a portion of your income every month is an investment in your future stability.

Timeframes for Financial Goals

It’s important to establish goals based on their timeframes. These are the three options you have.

Short-Term Financial Goals: Less Than 1 Year

Short-term financial goals can be achieved in a short time frame.

For instance, you can aim to pay off a $5,000 credit card balance by the end of the year and adjust your spending habits. You can make immediate changes to your financial habits, and that can include investing an additional 1% of your paycheck each year.

Some short-term financial goals only take a few minutes, while mindset-based goals, such as developing good habits, can take place within a few days if you maintain financial discipline.

Mid-Term Financial Goals: 1 to 5 Years

Mid-term financial goals range from 1 to 5 years.

Some people may tackle bigger debt, such as a $100,000 balance within five years. Other people may aim to build up their stock portfolios from $0 to $100,000 within this timeframe.

Another mid-term goal is to set up an emergency fund that can cover 6 to 9 months of living expenses.

Long-Term Financial Goals: 5 or More Years

Long-term financial goals have timeframes above five years, and this is where you get the most ambitious.

Some long-term financial goal examples are:

• Having a $1 million portfolio
• Paying off your mortgage
• Saving enough in a 529 plan for your children’s college education

Financial Goals by Life Stage

Financial goals can also vary based on your life stage. These are some financial goal examples people have based on where they are in their journeys.

• Students: Invest a large portion of every paycheck into assets, increase income and save up for a house.
• Families: Save money for college tuition, pay off the mortgage early and max out retirement accounts.
• Retirees: Move into low-volatility assets with high cash flow, downsize and make sure the nest egg lasts for as long as possible.

How To Set and Prioritize Financial Goals: 5-Step Guide

Setting goals can be overwhelming, but it’s not impossible. Here’s how to start.

1. Assess Your Finances

Your first step in setting financial goals should be assessing your current financial situation.

Take a look at your income, expenses, debts and savings. Identify areas where you can cut back on spending and areas where you can increase your income.

This will give you a clear picture of where you stand financially and where you need to focus your efforts.

2. Distinguish Between Needs and Wants

Knowing your needs and wants can help you decide what to prioritize and what to reduce from your life. You need financial freedom more than you need to make an impulsive purchase.

It may be nice to buy a luxury car, but it’s something that you want. It might be better to accomplish financial goals that you need before achieving want-based financial goals.

3. Establish Objectives

Next, think about what you want to achieve in the coming year. Do you want to pay off debt, save for a down payment on a house or build an emergency fund?

Once you have chosen what you want to achieve, you can start setting specific goals.

4. Envision the Consequences of Falling Short

Many people talk about the fear of failure as something that holds them back, but you can also use the fear of regret to propel yourself forward.

Think about what happens if you fall short of your financial goals.

How does that impact you and your family? Which goals, upon envisioning the consequences of falling short, would fill you with the most regret? Chances are wants-based goals like a luxury car won’t be in this category.

5. Plan What You Have To Do To Become Successful

Say you want to build a $1 million portfolio. What are the daily, weekly and monthly actions you have to take to become successful?

Envision what that looks like as if you’re reflecting on a long journey that ended with a $1 million portfolio. This type of reflection can help you follow good money habits and stay disciplined.

Final Takeaway: Plan Out Your Finances

Setting financial goals can give you more control over your finances and help you establish good money habits. Taking a few hours to plan out short-term, mid-term and long-term financial goals can save you from significant money stresses as you get older. If you plan and monitor your progress, you put yourself in a better position to succeed.

Chris Ozarowski contributed to the reporting for this article.

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