- Make your financial goals as specific as possible. To get richer is not a goal! To save 10% of your income, is.
- Identify a time frame. For example, decide to pay off your student loans within 5, or 10 or 15 years after graduation. If you have a deadline, you are more likely to work towards achieving a goal.
- Ask your relatives to contribute to your student loans, Roth IRA or any other type of debt/savings account directly rather than to give you cash or buy gifts for Christmas, birthdays and graduation.
- Break down huge goals into smaller pieces. This way, you can make them more achievable and celebrate along the way.
- Create positive goals. Instead of saying “Get out of Debt”, focus on “Freeing up income by shifting it from student loans to fun.”
- Think of what’s important to you and your life and spend your money accordingly. If spending time with your friends is important, spend the money on activities with friends rather than on things.
- Be able to live on less than you earn, no matter what.
- Make room in your budget for what’s important to you. But first, figure out what the important things are in your life.
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Inga Chira, Ph.D., CFP® and Assistant Professor of Finance