Some of these are short term goals and others long term but the important point to consider when reading these 7 goals is that most are in order of priority. Although the final goal of getting help or advice can of course be considered at any time, normally people look for advice once you have started to build savings and now looking for where to invest, whether property, shares or getting the maximum out of your superannuation. 

Goal 1. Build an emergency nest egg

One of the biggest problems I find when it comes to people and money is that many have lost the ability to save or at least struggle with it (as a third spend more than they earn). So getting into a disciplined habit of putting a set amount away at the start of the pay cycle (don’t wait till the end) is so important as this is the number one goal to understanding and getting control of your money.

So your first target is to build an emergency fund or nest egg. While often seen as a short-term financial goal, it actually offers long-term benefits that make it a valuable achievement. Firstly, it provides peace of mind by eliminating money worries and ensuring you always have a safety net for unexpected future situations.

Moreover though, an emergency fund serves as a crucial money management tool. If you can save money for emergencies, you should be able to save for any future financial goal you set yourself.

The best option once you have saved some funds or have a lump sum from an inheritance or tax return for example, is using this as a deposit for a property whether your own home or investment property. After that using your savings to start building a portfolio of blue chip shares is something to start looking into.

Goal 2. Lose the debt (bad debt that is)

Once you separate good debt from bad debt – good debt is for building assets that provide regular income such as an investment property and rent. And bad debt is everything else such as credit cards used for buying lifestyle assets such as clothes, phones etc.

Why is paying off bad debt a smart move, well for example, it helps you save money by eliminating high interest payments associated with this type of debt (most credit cards are over 20% per annum and if you just pay off the minimum it will most likely take you 50 years to pay the whole debt off!). Also by reducing the overall financial burden of bad debt, it now frees you up to start putting money away for future saving projects and helps your credit rating for borrowing good debt such as for a mortgage.

Goal 3. Have a Safety Net

For me having a safety net is so important for any plan you start, especially for a financial plan. For me a safety net is having Life Insurance and an up to date Will.

Under the umbrella of Life insurance, this should also include Income Protection and Trauma (critical Illness) insurance. Income Protection protects your most valuable asset and when I ask most people they think their home, but actually your most important asset is your ability to earn an income.  As your income pays for your lifestyle and future plans so make sure you insure it.  Trauma insurance is important as we have about a 70% chance of suffering cancer, heart attack or stroke in our working lifetime. Importantly most of us are lucky enough to recover but financially could be a problem. Rule of thumb is about 6 months’ salary as a minimum amount of cover as about average recovery time for most trauma illnesses.

Goal 4. Multiple Income Streams

Having multiple income streams is the number one secret to reaching financial freedom especially if you want to do it before standard retirement age. It spreads out your financial risk and gives you a safety net if one source falters such as losing your job for a period of time. Plus importantly, it simply means more money in your pocket and even better, making money while you sleep as we should aim for passive income streams.  Yes a side hustle as a second job is another income stream but it needs your personal exertion to earn that income.

So an example of an alternate income stream is buying an investment property as this will grow over time (if well chosen) and provide an ongoing income stream from rent. The rent initially pays for the loan and eventually will be another income source as loan decreases over time.

We teach our clients how we then use the initial property to be a deposit for your next property and so on to build multiple income streams sources. Saving for shares and superannuation are other examples that can provide passive income streams (dividends and pension streams) but leveraging (borrowing good debt) we usually recommend only for property.

Goal 5. Plan for early financial security and freedom (as why wait till 65)

Once you start building multiple income streams and have enough income to replace your salary (we have a 15 year strategy plan to do this), reaching financial freedom early in life is a game-changer with some amazing benefits. First and foremost, it brings you a sense of security and peace of mind. Picture this: you’ve got enough savings and investments to cover your expenses and live the life you want without relying on a paycheck. That means you can make decisions based on what truly inspires you, rather than constantly worrying about money. You can work because you want to, not because you have to.

Not only does early financial freedom give you peace of mind, but it also unlocks a world of possibilities. Imagine having the freedom to chase your passions, take risks, and explore new opportunities without the fear of being strapped for cash. Whether it’s starting your dream business, embarking on epic adventures, or continuing your education, having financial freedom early on gives you the flexibility to design a life that aligns with your dreams, your goals. This is the ultimate aim for all my clients.

Goal 6. Give Back

What’s the point of having money if others less fortunate struggle, so to me giving back is incredibly important.

It’s all about making a positive impact on the world around us, and guess what? Giving back isn’t just good for others, it pays us back ten-fold, in ways we would not even realise. It can help bring a sense of fulfillment and purpose, knowing that we’ve made a difference, and hopefully it creates a ripple effect and inspires others to do the same, hopefully creating a chain reaction of sorts.

Even when we look at investing, there are now ethical investment options with most superannuation funds. Something worth checking out on your superfund’s website and see how they invest, how they are making a difference as well as how they are performing as still need to get a good rate of return on your investment.

Goal 7. Get help

It seems strange I have this as a goal but for many, they feel they need to have money before they get help or get advice. But getting help from experts should be a goal we all strive for as we just don’t know what we don’t know, and why make expensive mistakes when we don’t have to.

They have the knowledge and experience to steer us in the right direction. Whether it’s about finances, career choices, or even personal growth, tapping into their knowledge and experience can save us from unnecessary mistakes and help us make better decisions.

Why struggle on our own when we can benefit from their expertise? It’s like having a secret weapon in our back pocket. So, let’s swallow our pride or the ‘I’m too busy’ excuse, and seek out those experts whether from property experts, debt specialists (rather than a bank) and a experienced money coach or financial adviser, and let them help guide you to success and reaching your goals. Believe me, it’s totally worth it!

 

Article by Marc Bineham – Money coach, speaker and award-winning author of The Money Sandwich