Whatever it is that you desire to save money for, if it’s “financial security” that you are looking for, then you need to look beyond affording that wedding, or that second-hand car.  You should also be looking at what kind of lifestyle you want to live by the time you are retired. 

It’s not that saving for a car, a house, a wedding, or education for your children are not important.  By all means, they are VERY important.  But so is saving for your retirement.  If you don’t appreciate what I mean, I dare you to find out exactly what it is that your company has set aside for your retirement (assuming you’re employed), or to find out exactly what your business is worth today and what it might be worth by the time you retire. 

Don’t be surprised that you’re probably like the great majority of employed and self-employed individuals.  After planning for your wedding, for your children’s education, for your car installment payments, and for your apartment rentals or home mortgages, you’ll find that you may not be ready for your retirement.  Oh, and did I mention that you might have to provide for your aging parents who, themselves, failed to prepare for their retirement?

It’s beginning to sound depressing that you may not even want to go through this very important step in planning for your future.  But, if you’re really serious, you CAN do something about it.  If, after you have defined your goal, you will discover that you have a problem because you don’t know how to ever achieve it, then be consoled in the old adage that says, a problem defined is a problem half solved.

As I said in an earlier post, there is good news!  You don’t have to be a genius to be financially prepared for your future, and you don’t have to be wealthy to begin with. 

The first step is to face the future squarely and define the challenge: decide what your goal is first and then make a plan.  Your goal will not happen just because you defined it.  But neither will an investment plan work, if you have no goal to begin with.  So, take the time to plan your goals.  Dream a dream, if you want to.  But do it.  Now.

 Step 1.  Enumerate all the important activities that you will encounter in your lifetime that will require a substantial amount of funding.  When you’re doing this, try to list down as many goals as possible without qualifying them.  This way your flow of thought goes through smoothly.  If you have a spouse, it is best to get your life partner involved in this very important process.

 Step 2.  Organize each goal in terms of time-lines.  Time is a critical factor in saving for your goals.  Having a lot of time makes it easier to reach the goals but then again not all goals are long-term goals.  So group each goal into Intermediate (less than 3 months), Short-term (more than three months but less than 2 years), and Long-term (two years and over).  These timelines represent the period by which each goals are to be accomplished.  Note that the time-lines may vary for different people.  What is important is to know exactly when you need to accomplish a certain objective. 

 Step 3.  Come up with SMART Goal Statements for each objective.  Make sure that each goal you enumerated can be stated as Specific, Measurable, Attainable, Realistic, and Time-bound objectives.  To accomplish this, you will need to quantify each financial objective and estimate the amount of time you have to reach these goals. 

 The steps are easy enough to follow.  Just make sure you put them all on paper. 

Remember:  The difference between a GOAL and a DREAM is the written word!