We all have things we want to accomplish in life, and, chances are, they won't be cheap.
If you plan to have a family, the USDA estimates that it costs about $250,000 to raise a child born in 2012 through age 16 — plus college tuition, which can top $200,000 at some schools.
Even if you don't have kids, it's recommended that everyone have around six month's worth of savings stored in case of an emergency. That's on top of retirement savings, which at this point in time generally need to cover about 30 years of living expenses.
It's time to think big. Get an idea of when your goals will become reality by listing:
- Your financial goals. These are major purchases or achievements like getting out of debt, buying a home, paying for a wedding, and taking that trip to the French Riviera.
- Your income. If you already have a budget, you should know this number cold, but if not, include your take-home pay as well as any other income streams you may have.
- Your debts. Do you have credit card debt, student loans, a car loan, or a mortgage? These payments are obligations you must meet, so take them into account when planning how much money goes toward your goals.
Then get specific by adding deadlines to achieve your goals, taking into account your debt and income. How much will you need to put toward that goal per month in order to achieve it by your self-imposed deadline?
Automate the process as much as possible by having money from your paycheck or checking account diverted into the appropriate savings accounts automatically through your bank and linking up your accounts to free services like Mint orLearnVest, which will keep track of your money and your progress for you.