How To Set Financial Goals

We interviewed one of our Financial Planners, Cameron McKay, about
setting financial goals. Read on to see his guidance on what to do,
how to keep on track and ultimately achieve your goals!

Should we set long- or short-term goals, or both?

It is important to set both long- and short-term goals as both can be factored into your financial
planning.
Short term goals could include building an emergency fund, paying off debt, purchasing a new
car or funding your children’s University fees. Longer term goals may be building a retirement
fund, paying off a mortgage, or building a legacy for your loved ones.

Why is it important to set financial goals?

When you start with the end in mind, it becomes much simpler to focus on what it is you want to achieve.
Your Financial Planner will need to know what your goals are before we can plan out how to help
you get there. This is why we always do a deep dive into what matters most to you before any of
the technical work begins.

Through tailored financial planning, we help you build a roadmap to your goals, with careful steps
on how to achieve them, and ongoing reviews to help you stay on track!

What tactics do you use with goal setting?

Setting out what you want your future to look like is crucial. It gives you an opportunity to
think about what your priorities are and the reasons you’re looking forward to this chapter
of your life.

I advise my clients not to start with the value of their pot, but to first think about the following
three questions:

• When do you want to be financially independent?
For some people the answer is ‘as soon as possible’, but many enjoy their work.
Is part time work or a phased retirement something you would consider?

• What does your ideal retirement look like?
What is it you are most looking forward to? This could include travelling, hobbies,
spending time with family, moving home, or even starting a new business.

• Do you have any other priorities or goals for retirement?
For example, would you like to leave a legacy for your family? Do you want to
help your children or grandchildren get on the property ladder? These elements
will need to be factored into your plan.

With goals set for retirement and lifestyle, Wealth Matters then map out how you will be
able to afford it.

We break down your finances into four key areas:

• Essential spending: This is the basic income you need;
• Discretionary spending: What extra income you need to allow you to live the
retirement lifestyle you need to;
• Emergency Funds: Maintaining a buffer will improve your financial resilience;
• Lump Sums: I normally ask my clients, how often would you like to change your car in
retirement? What large holidays or cruises do you plan to go on?

What is a good way to make sure we are on track with achieving our goals?

Using smart forecasting tools, we can build a picture of where you are now versus where you’d
like to be in the future.
We can model different scenarios and effectively predict how and when you will achieve your
goals. You may hear this method referred to as “cash flow planning”.

How often should we review them?

It is important to review your goals at least once a year. Your personal goals may even change
depending on your circumstances, especially during major life events, so you may need to add
new ones!

Meeting with your Financial Planner on a regular basis ensures that your plan remains current and
achievable by monitoring progress and making adjustments. Your Financial Planner will aim to
ensure you have the flexibility you need to accommodate the inevitable unknowns, while never
taking our eyes off your ultimate prize.

Get in touch with us if you’d like to discuss your financial goals and how we could help you achieve them.