Biggest Financial Planning Priorities ?

So what is your biggest financial priorities in your overall financial planning ? Even before we answer that, biggest could mean different for different people. For some, the biggest financial goals could be those that are most significant for you and your family and which are of highest priority for you. For others it could be the one that is biggest in monetary terms.

But for all, in your laundry list of financial targets, the biggest is the one that you cannot do without.

It could be buying a house, saving for your retirement, saving for your children’s education or marriage or a hobby you want to pursue. Which among these is the biggest financial planning priority for you ?

Financial Planning Priorities – Different for Different People

Major financial planning priorities are different for different people.  A young person who has started out on his career might have little or no financial priority while someone who is married and in early 30s might begin to think about buying a house.

Buying a house is an important dream which many middle class investors want to fulfill and for many, it tops as the biggest financial ask. Monetarily too, it seems like taking the largest cut in one’s outflow.

It’s only when you graduate into late 30s or early 40s does the realization of retirement begin to knock sense in you. In fact, many do not wake up even at this age. At this time, you begin to get worried about your child’s higher education and marriage. Your worry to save enough to give a decent education to your children and do a exemplary marriage makes you push saving for your retirement much later.

So by the time you come to mid 40s, you are already branded as late in starting to save for retirement. Essentially you might have lost the advantage of  long term investing for your retirement.

So a person’s biggest financial priority keeps on changing in response to the family environment around him and he keeps responding according to his knowledge and financial disposition.

Is this how it should be ? Or is there a better way ?

Prioritize your goals

Set priorities for your financial goals. List them and assign them ranks from 1 to 10, with 1 being the most important. You can also rank them with High, Medium and Low importance. At the same time, you need to look around you to see how financially things are evolving around you.

In today’s scenarios where young kids are taking on more and more responsibilities, they might end up saving money for their marriage and even taking a loan for their higher education. If this is the case, your decision to save money for their goals is taken care of. You can then plan to channel the money into your retirement. So suddenly, the priority for your kid’s goals is not high anymore.

Remember that with more and more children staying away from parents, you will need to go with the assumption that you will need to provide for yourself in your old days and that your children will not support you. Because of that, saving for your retirement becomes a very important financial objective. It attains high importance.

So put financial planning priorities to your goals and decide what you want your money to accomplish for you in your life. And take steps towards realizing that financial goal.

For anything that is on priority for you, you will save more towards it. Check whether in your goal based investing approach, are you saving money into investment avenues towards this particular priority each year. If not, ask yourself how you will achieve it.

You should end up saving more money each year for your financial goals.

So what is your biggest financial planning priority or goal ?