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The Importance of Short-term Financial Goals for Your Finances

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To effectively plan for a stable financial future, it is important to set achievable short-term financial goals. To many South Africans, financial freedom and the elimination of stress related to debt are often short-term financial goals that take top priority. 

In this post, we uncover just how important short-term financial goals are to make your financial dreams become reality and how you can get started.  


What are short-term financial goals?

Short-term financial goals are objectives that involve money that you would like to complete or reach within the next one to three years. These include once-off goals such as saving for a small deposit or drawing up a budget.

You could even set short-term annual goals that contribute to some of your bigger targets, such as paying off your household bond or all of your debt.


The importance of short-term financial goals

When mapping out your financial future, taking one step at a time is crucial. As mentioned before, short-term financial goals are often the pivotal stepping stones towards achieving your greater financial aspirations. 

There are other significant reasons why you should set short-term financial goals. 

Bite-size goals can help you manage your spending habits, provide you with a solid reason as to why you are wanting to achieve these goals, keep you accountable for your expenditure and allow you to effectively track your progress. 

And on a more emotional level, it also places your financial future into perspective: it affords you an opportunity to look at the ‘bigger picture’ and what financial direction you are working hard towards.  


How to set your short-term financial goals

Every person’s financial situation, desires and goals are unique. So, when it comes down to prioritising which goal is most important, keep your financial freedom top of mind. 

What do we mean by this? A positive first step would be to position your short-term financial goals to address urgent debt repayments, improve your credit score or repay loans that may be generating interest. 

So how exactly do you even begin to set short-term financial goals? 


Define ‘short-term’ 

First and foremost, you need to consider what exactly a short-term financial goal is. 

Sometimes we get carried away with setting goals for larger, more long-term targets (which just adds unnecessary pressure). To help you identify if your goal is a short-term one, ask yourself this question; ‘Can I realistically achieve this financial goal in the next year or so?’ If the answer is yes, it is a short-term financial goal. 


“Write” down your goals 

Your goals do not have to be written down on paper in the traditional sense, but maybe viewing your goals visually could give you that extra kick to achieving your short-term financial objectives!  

Try creating a financial goal board or listing your goals where you can see them every day. Not only will this assist you in gathering your goals into one consolidated space, but also help you to keep track of your overall progress.

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Track your progress

As we mentioned, being able to confidently record your progress is a worthwhile step in accomplishing your short-term financial goals. It also assists you in flagging any negative spending behaviour.

On this note, if you feel as if you need professional help or advice on your money situation, consider getting in touch with a trusted financial professional.

For over-indebted individuals, the first step towards meeting any financial goal, whether short- or long-term, involves reducing your debt.

With the burden of debt out of your way, you’ll have a better financial balance to use when working towards your financial objectives.


What are some examples of popular short-term financial goals? 

To each person, every goal varies, however, there are a number of popular financial goals that exist. 

Some examples of short-term goals include:

  • Creating and sticking to a monthly budget
  • Reducing household expenses
  • Setting up an emergency fund
  • Saving money for a deposit on a car
  • Finding affordable healthcare insurance
  • Putting money away for an upcoming family vacation
  • Growing your investment portfolio


Everyone has different short-term financial goals, you’ll prioritize what matters most to you, which is partly dictated by the state of your current financial situation.

Pick two or three that matter most to you, or dream up your own, and get going. 


Small and steady on the road to success 

Don’t underestimate the importance of your short-term financial goals! Take baby steps and be consistent: tackle the short-term goals first and then start planning for the long-term ones.

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Disclaimer: This website and any information herein is not intended to be, nor does it constitute, financial, tax, legal, investment, credit, or other advice. Before making any decision or taking any action regarding your finances, you should consult a qualified professional directly.

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