Turn your money goals into a money plan

Turn your money goal into a money plan

by Verve

It’s been said that a goal without a plan is just a wish and your dreams are certainly too important to wish away.

So you’ve got your money goal/s, and you’re feeling pumped to achieve them!

The next step? Create a simple money plan.

Why is this step important? Well, because breaking down how much money you’ll need to contribute towards your goals each month is key to being able to hold yourself to account and also to ensure that you stay on track with your saving and/or investing as you work towards your goals over the long term.

So here’s the simple way to break a goal into an actionable plan:

Step one

Grab a pen and paper or use the Money Plan in this Workbook (just make your own copy and you’ll be able to edit it) and list all the goals you’re working towards. Think about these three categories: emergency savings, short-term savings and long-term savings, and get really specific about what amounts you want to reach.

Step Two

Write down your goal timeframe, i.e. when you want to have the money by.

Step Three

Determine how much you already have saved or invested towards this goal.

Step Four

Work out the total amount you will need to save/invest (the number in Step One minus the number in Step Three).

Step Five

Work out how much you will need to regularly contribute (i.e weekly/monthly) by dividing the total amount of money you need in Step Four by the number of weeks/months that you have remaining before your goal deadline. If your goal horizon is many years away, then you may also want your calculation to factor in where you are saving and/or investing your money as you work towards your goals.

For example, if you are investing some of your money, you may be able to factor in expected returns on your investment. There are a couple of ways you can do this step. You can use an app, you can use an excel sheet, or you can check out the MoneySmart Savings Goal Calculator here.  

And there you have it. Now you’ve gone from a goal to understanding the weekly or monthly saving and/or investing habits that you need to create.

This article is published by Verve Money Pty Ltd (ABN 71 653 669 366, AFS Representative No. 001294184), a Corporate Authorised Representative of True Oak Investments Ltd (ABN 81 002 558 956; AFSL 238184), as the Manager of Verve Money. A friendly reminder that all the financial information contained in this article is general in nature and does not take into account your personal financial objectives, situation or needs. It’s important to do your own research and consider getting in touch with a professional adviser to access specific information tailored to your unique situation.

You should read the Product Disclosure Statement, Investment Guide, Target Market Determination and Financial Services Guide before making a decision to acquire, hold, or continue to hold, an interest in the Verve Money Fund. Visit www.vervemoney.com.au/documents to view these documents.

Interests in the Verve Money Fund (ARSN 662 622 899) are issued by Melbourne Securities Corporation Limited (ACN 160 326 545, AFSL 428289). When considering financial returns, return of capital is not guaranteed and past performance is not indicative of future performance.

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