Stop Living from Paycheck to Paycheck by Identifying Short Term Goals

Stop living from paycheck to paycheck this year. You can save some of the money you earn if you plan ahead. Learn how to get ahead of these debts with these tips:

Your first goal should be to develop a plan to save money. When you set up a savings plan, you need to think about a few different categories for saving: short-term, long-term and emergency savings should all be part of your plan.

For starters, you need a short-term savings plan. Identify your smaller goals like taking a vacation or buying a new car. When you think in terms of a year, and how life events might affect your savings plan, you’ll be better equipped to make decisions. For example, you can probably count on an annual increase in salary this year. You can probably safely estimate an increase of 4%, unless you expect to get promoted or plan to switch jobs.

I recommend sitting down and looking at your 2008 month by month calendar when you’re thinking about your savings goals. I was chatting with my folks the other evening and even without a calendar, they counted eight trips that they’ll take this year. My father guessed that was about ½ of the travel they plan to do.

We’ll talk more about savings goals in upcoming Credit Tips blogs. Until then, focus on planning your short-term goals for 2008.

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