Investing always be Goal-Oriented. There is a saying- ” A Goal without a plan is just a wish”. There is no meaning to investing with proper financial planning.
The primary agenda to financial planning must be a “goal”. Without a goal one should not commit financial plan. Financial Planning includes achieving “SMART” Goals.
What are “SMART Goals”?- Goal should be-
- S- Specific– The goal must be specific which is inter-related to your future needs. The goal should specify your realistic dreams and your planning to achieve that goal.
- M-Measurable– The goal should be measurable. That means, your financial planning should be in limits and specific.
- A- Achievable– Your goal should not be unrealistic. It should be in simpler terms and achievable. For example, if a poor person dreams to be a Crorepati within 1 or 2 years, it is a unrealistic goal. There is no magical tool to make wealthy in shorter period. Wealth should be created by making realistic, achievable efforts
- R-Realistic- Your goal should be realistic in nature. Can a L.K.G Student makes a plan for house construction?Obviously-No! He should slowly learn letters and numbers and after gaining knowledge in particular field only, he can design a plan for house construction. So making a realistic goal is essential in financial planning.
- T-Time Bound – The financial goal should be time related. Suppose you are planning for retirement. you should first calculate the current age, retirement age and the life expectancy etc. After analysing your current age and the remaining years for retirement, you should plan your investments. That goal should be achieved within that time period
While doing investments, you should remind this “SMART”Goals and plan your finances accordingly!