A lot can happen in 10 years. The recent #10yearchallenge trend on social channels can attest to this. It’s great to take time to look back with gratitude, but it’s even better to look ahead and start to dream and plan for your future.
Now it’s the not always easy to think about the 10 years ahead of you, but taking the time to prayerfully think about your future can help to clarify the choices you make day to day. This is especially true when it comes to our finances. When you have a clear vision of where you are going you’re able to make the daily decisions and small sacrifices needed to get there.
With 2019 just starting off, now is a great time to consider where you want to be financially in 10 years time and what you may need to do to get there. Whether you’ve already set your plans in a beautifully colour-coded spreadsheet, or you’re not really that much of a planner – just the act of writing down your 10-year goals can have a positive effect. Just having a picture of where you are going can help to energise and inspire you for the future.
So, as you read this blogpost, grab a pen and paper and start jotting down some thoughts. Here are six areas to consider as you visualise and set financial goals for the next 10 years. Each area includes a few questions to provoke thought and inspire vision.
Your career and income are a significant part of your financial future. In 10 years time do you see yourself progressing in your career path? In a totally different career? Working for yourself? Enjoying retirement? Your income over the next 10 years will determine what kind of lifestyle you have and what kind of saving and investment strategy you may need.
- What work do you want to be doing in 10 years time?
- What will your annual income be?
- What professional development or investment do you need to make to achieve your goals?
Your Consumer Debt
In 10 years time you could pay off a lot of debt, if you are intentional about it. Paying interest on credit cards, car loans and store payment plans is a waste of resources, which is why more and more Australians are focusing on becoming debt free as quickly as possible. Check out the Instagram hashtag #debtfreecommunityaustralia to get some inspiration from everyday Aussies paying down debt to achieve their personal goals.
- What debt could you pay off in 10 years?
- What monthly repayments do you need make to achieve this goal?
Your home is one of the biggest expenses you’ll have in your lifetime so it’s worth thinking through you and your family’s needs. In 10 years, what kind of home do you want to live in? Considering the lifestyle that you envision for yourself in the future do you see a house in the suburbs, an apartment near the city, or a villa near the beach?
- In 10 years, would you like to own your home or rent?
- What would your housing expenses or mortgage repayments be?
- What would you need to save each month or what repayments do you need to make to achieve your goal?
No matter what your age will be in 10 years, your Super is an important part of your financial future. Use one of the handy online tools such as this Money Smart Super Calculator to work out how much you’ll have in Super when you plan to retire. If it looks like you may not have enough, think about what you could do to get on track for a comfortable retirement.
- How much would you like to retire with in your Super?
- How could you increase your income to achieve your goal?
- What additional contributions could you make to help to achieve your goal?
It could be as simple as arranging for a regular contribution to be made to your Super. This can be done through your employer as a pre-tax Salary Sacrificed amount or as an after-tax contribution, setup directly from your bank account using your unique Super account Bpay details (details available in your account online or in the mobile app).
Do you plan to start a family in the next 10 years, or do you expect you’ll be a grandparent by then? Whatever the case, thinking about your family is an important part of the planning process. The needs of your family will determine what you may spend on housing, education, food, clothing and the various other incidental costs. A lot of things will change over the next 10 years, but having an idea of the direction you’re family is moving in will help you to prepare.
- What are you spending money on month to month? Take a look at some of the ASIC budgeting tools to see where you’re spending money.
- How much money can you save each month for your family’s future expenses?
Rainy Day Savings
Life is full of the unexpected. Having savings put aside for a “rainy” can help you stay ahead even when life throws you a curveball. Whether it’s a new purchase such a new washing machine, major car repairs or unexpected medical expenses, having a financial buffer for emergencies can help to alleviate a lot of stress and unnecessary debt down the track.
Start as soon as possible and automatically transfer an amount every week or month into your rainy day savings account. Putting aside even $20 each week can make a big difference in 1-2 years.
- What could you cut back on each week to invest $20 or more into an emergency fund.
Making time to think about the future helps to clarify what action you need to take now. Taking even the smallest steps to get your finances in order, start savings plans or take a bite out of your debt will help in the long run. If you need more guidance for your specific situation, why not make time to speak to a professional financial advisor who can help you put together a financial plan that meets your needs? What you do today can make a significant impact on your life in 10 years.
The content of this article includes advice that is general in nature and does not consider your personal situation. Christian Super encourages all people considering their options in retirement planning to seek out qualified professionals who can provide specific personal advice.