New Year, New Goals: Planning Your Money Moves for 2024

December 26, 2023

Smart Money Moves: Will You Start the New Year with a Roadmap to Success?

The coming of a new year inspires much thinking and planning. You may be looking for ways to structure and organize your life to be prepared for a brand-new year, especially when it comes to your personal finances. As you plan your money moves for 2024, it’s important to consider both short- and long-term goals. It’s also beneficial to arrange finances for emergencies or unexpected situations. How should you plan your money moves for 2024 to ensure economic stability and prosperity? Here are key strategies to consider.

List Short-Term Goals

When people discuss personal finances, they tend to think in generalized terms. How much wealth have they accumulated? How are their finances positioned for the future? Will they be able to retire comfortably?

While all of those objectives are important, you still have to live in the present. This means taking care of short-term needs that may arise within the next few years. Your money moves for 2024 should account for these smaller-scale goals and unexpected events.

Short-term goals can include:

• Paying down credit debt
• Building an emergency fund
• Saving for vacation
• Purchasing new appliances
• Exploring additional income streams
• Renovating or improving your home
• Planning for marriage, children, relocation, or other life transitions

Many other goals and ambitions can be characterized as short-term needs. Whatever they are, make room for them in your plans for money moves in 2024. You may have big ideas in mind for the future, but you still need to live day to day. Plan your finances to take care of the present, too.

Articulate Long-Term Goals

While you’ve got to consider your short-term financial goals, it’s essential to keep your long-term goals in sight, too – even though these are goals that won’t be met for years, or even decades down the road. They can include:

• College tuition for children
• Saving for retirement
• Paying off a mortgage
• Starting a business
• Planning for long-term healthcare needs
• Achieving financial independence
• Establishing a legacy

Thinking about long-term goals can be frustrating at times because they often feel aspirational. You can expect to make gradual progress – even slow at times – which can be a hit to your motivation. It’s not necessarily easy to track your success in meeting them. However, it’s very beneficial to itemize them while you’re still working to set a framework for your future.

Keeping these goals uppermost in mind will help you make more responsible financial decisions now, planning your money moves for 2024 to pay off handsomely in the future.

Identify Middle-of-the-Road Goals

Sometimes, it’s hard to determine whether a certain financial goal or need is short- or long-term. Some may consider buying a home within 10 years to be a long-term goal, while others who are positioned to buy a house outright might think about it as a short-term goal.

The good news is that you don’t have to classify these middle-of-the-road goals. You can set a reasonable timeline for accomplishing them that works for you. Some of these goals might include:

• Maximizing 401(k) contributions
• Improving your credit score
• Supporting charitable causes
• Taking on home renovations
• Growing your savings and emergency funds
• Pursuing a “passion project”

These goals can also be considered “active” ones that aren’t defined by time. Although many people prefer to have some sense of time for each goal, you can give yourself the freedom to identify timelines that work best for you, identifying money moves for 2024 that suit you personally.

Make a Realistic Budget

One of the biggest pitfalls of setting financial goals is harboring unrealistic expectations. You might expect to be able to conclude payments on your car loan within three years, but you can’t account for uncertainty or surprises. It might not even be possible to construct a timeline until you’ve been working at achieving your goals for a time.

On the other hand, you might discover that you have the means to pay off certain debts earlier than expected. You may find yourself able to pay double your current mortgage and get on track toward an early payoff. If you’ve set a realistic budget that allows you the time and room to make alterations, you’ll find it easier to accomplish your goals.

When you make money moves for 2024, approach them from a realistic standpoint. This goes beyond daydreaming — it means thinking rationally, preparing honestly, and putting pen to paper. Don’t be afraid to switch short- or mid-range goals to long-term goals if the situation warrants. Think about the future, but also think about how to maintain a content existence from day to day.

Get Help with Your Money Moves for 2024

January is Financial Wellness Month and there’s no better time to think about your financial future. If you would like to update your Lane Hipple financial plan or simply refresh your memory as to the financial goals we set out to achieve for you, please do not hesitate to reach out and schedule an appointment.

Happy New Year!

Illuminated Advisors is the original creator of the content shared herein. I have been granted a license in perpetuity to publish this article on my website’s blog and share its contents on social media platforms. I have no right to distribute the articles, or any other content provided to me, or my Firm, by Illuminated Advisors in a printed or otherwise non-digital format. I am not permitted to use the content provided to me or my firm by Illuminated Advisors in videos, audio publications, or in books of any kind.

Financial Goal-Setting Tips to Help Achieve Your Money Goals

May 25, 2022

Clarity is Key if You Want to Reach Your Personal Financial Benchmarks

When it comes to your money goals, it’s important to focus attention on your short-term and long-term financial goals. Gaining clarity on which of your money goals fit into which category can help you properly budget and save for them accordingly.

Short-Term Financial Goals: The Basics

It may seem self-explanatory, but timelines for your financial goals are on a continuum, so it’s valuable to identify which types belong on your short-term list. Of course, these are the goals that are for your more immediate needs, but that could mean the next few months or the next few years.

As you think about your short-term money goals, here are a few common examples:

• Upcoming life transitions (marriage, new baby, buying a home)
• Saving for your emergency fund
• Paying off debt (credit cards, student loans)
• Travel plans
• Home repairs and improvements

If you don’t see some of your own goals on this list, it doesn’t mean they don’t qualify as short-term goals. As you work on your goal-setting, it can help to think in terms of what you hope to accomplish in the next five years versus what you hope to accomplish beyond that timeframe.

Clarifying Long-Term Financial Goals

Most often, long-term money goals are those “big picture” costs you’re working towards. They won’t be accomplished in months – or even in a few years’ time. Rather, they may take decades to achieve. They also tend to involve higher dollar amounts than your short-term goals.

Here are a few common long-term financial goals:

• Saving for retirement
• Putting your children through college
• Paying off your mortgage
• Starting or buying a business

Keep in mind that, although you will probably be making incremental progress toward these goals on a monthly or yearly basis, they are still long-term because their ultimate achievement is many years away.

Get Comfortable with the Gray Area

It’s easy to confuse your short- and long-term goals when they overlap a bit – which is normal. If it helps you, create a category of midterm goals for yourself, too. These may be goals you hope to achieve in five or ten years, but set the timeline that makes the most sense for you.

These middle-of-the-road money goals may be things like:

• Saving for a down payment on your own home
• Raising your credit score
• Buying a car with cash
• Working toward maxing out your 401(k) contributions

If the idea of midterm goals makes things feel fuzzier for you, rather than providing added clarity, try a different tactic. You can always take pieces and parts of your long-term goals and add them to your short-term list with specific timelines for accomplishment, too.

Estimating Realistic Time Periods

One of the more challenging aspects of financial goal-setting is that many people have a “gap” between when they would like to accomplish a money goal and when it is actually realistic to do so. While some goal periods are difficult to estimate, you’ll help yourself by having a good handle on your financial situation. If you haven’t created a budget yet, make this your first step. Once you know exactly how much you have coming in and how much you’re spending and where, you know how much extra money you have each month to put toward future goals.

For example, you may have a short-term goal to pay off your student loans in five years or less. When you do the math, though, you find that it will actually take you ten years based on your current income, pushing this goal into your long-term category instead. It can work the opposite way, too – you might realize that careful spending will give you enough to make a double mortgage payment each month, effectively cutting your payment timeframe in half. Either way, it’s easy to see how budgeting is a critical step in meeting your goals.

Budgeting and Saving 101

Knowing where you stand is crucial to the rest of the goal-setting process for a few reasons. First, it forces you to come face to face with your spending habits, which may have some room for improvement. Second, it shows you the math – and numbers don’t lie. Rather than setting arbitrary time periods for achieving your money goals, you’ll know what you can actually accomplish.

While there are different methods to use for setting up your budget, many people use a 50/30/20 budget as their baseline. This is where you use 50% of your after-tax income for your needs, 30% for your wants, and 20% for saving or paying off debt. You can use this calculator to get started, or try a budgeting app like Mint or YNAB (You Need a Budget).

Ideally, your budget will show you that you have excess income each month that can go into your savings. So, where should you store your nest egg until you need to use it? For short-term goals like your emergency fund, choose a high-yield savings account that you can access easily and that doesn’t have a minimum balance requirement. For midterm savings, you may be best served by a Series I Bond. For long-term savings, say for retirement, you want a tax-advantaged account like an IRA or 401(k).

Setting Financial Goals

Most people have multiple short- and long-term financial goals, and it’s impossible to give equal weight to all of them with limited resources. So, think about which goals help you fulfill a need versus those that help you fulfill a want. Even though it may be tempting to put more toward your vacation fund for next year, failing to put enough into your retirement savings could mean you can’t pay your bills once you retire. So, allocate your money toward your needs first – regardless of their timeframes – and then you can allocate the rest of your funds toward your wants.

Take Action

If you think you would benefit from a conversation about setting financial goals, contact Lane Hipple in Moorestown, NJ by calling 856-638-1855, emailing info@lanehipple.com, or to schedule a complimentary discovery call, use this link to find a convenient time.

If you like what you’ve read, please share this article.

More Articles:

• National Retirement Planning Week
• Maximizing Charitable Giving: Strategies for Making an Impact
• The Excise Tax Waiver Has Expired for 10-Year IRA Beneficiaries with Annual RMDs
• Employee Stock Ownership Plans for Executives
• Love and Money: What to Do When Your Spouse Won’t Talk About Finances

Illuminated Advisors is the original creator of the content shared herein. I have been granted a license in perpetuity to publish this article on my website’s blog and share its contents of it on social media platforms. I have no right to distribute the articles or any other content provided to me, or my Firm, by Illuminated Advisors in a printed or otherwise non-digital format. I have no right to distribute the articles or any other content provided to me, or my Firm, by Illuminated Advisors in a printed or otherwise non-digital format. I am not permitted to use the content provided to me or my firm by Illuminated Advisors in videos, audio publications, or in books of any kind.