All successful organizations have short- and long-term goals and a written plan for reaching them. If you want to be financially successful, you should have your own goals and plans. The first steps are to determine your financial status today and then decide what you want to achieve for your future and how you’re going to accomplish it.
You wouldn’t start out on a long trip into unfamiliar territory without a road map, yet many people go through life without a concrete plan for their financial future. In fact, most people spend more time planning a single vacation than they spend on financial planning. The road you take to financial freedom can lead directly to your destination or to a dead end. Specific financial goals and written plans for meeting them help you focus your efforts on the end result.
Start Early
Starting to save and invest when you’re young is a huge advantage. If you invest $5,000 one time at the age of twenty, and that investment earns an average 7 percent interest per year, at retirement (age seventy) you will have over $163,000. The same one-time amount invested at the age of forty would total less than $41,000.
Goals are like the wheels on your car; they keep you moving in the direction you want to go, and you won’t get very far without them. If you haven’t already started planning for your future, now’s the time to begin, no matter what your age.
Saving and investing will give you the most powerful financial tool available: time. In fact, the smartest thing you can do when you’re young is save and invest. Ultimately, you’ll be able to save and invest smaller amounts at a time and will still come out far ahead of the person who starts a decade or two later. But even as you grow older, developing a clear saving and investing plan will give you a considerable advantage. As the saying goes, “Most people don’t plan to fail, they just fail to plan.” Without planning, even the best of intentions go nowhere. Start mapping out your route now. Your entire future depends on it.