As the year comes to a fresh start, you might have regular payment targets that you endeavor to accomplish every single year. However, this is not just the start to a new year but it also signifies the beginning of a new decade. This year is a start for a new decade and planning for one could take a lot more foresight than you are used to.
At the turn of the year, it could be a normal routine for you to lay out all the goals you want to work for during the next 12 months. Planning for a whole decade gives you a different perspective and approach. The longer time you have to plan, the bigger goals you can be. You have to remember though that this long timeline can be a disadvantage as well.
You can have great payment targets but if you know that you have a long way to go, you might start to take it easy and not pay attention to it. If at the back of your mind you know that you have 10 years to work on your goals, there is a chance that these goals just fall down from your priority list. After a while, they could end up forgotten over a long period of time.
If you are serious about making this decade as a jump-off point in getting your finances in order, there are a few goals you might want to consider. The length of preparation time can give you a different perspective on these financial goals.
Pay off your house
One of the payment targets you can have for the decade is to look for ways to pay for your mortgage loan. When you take out a mortgage loan, these normally last anywhere from 10 to 30 years depending on the type of loan you take out. This can also depend on how you pay down your mortgage if you make extra payments or principal payments.
The Washington Post shares that a strong job market coupled with low mortgage rates should keep the pace of the housing market this year. This means that a lot of people would be taking up a mortgage loan this year to help them realize their dreams of owning a home. If you are a part of this group or have recently taken up a mortgage loan, you can use this new decade to plot out how you can pay off the house faster.
Manage your student loans
If you recently graduated from college or took post-graduate studies, there is a good chance that you are now starting at your student loan debt. CNBC shares that on average, about 70% of college graduates start off their careers in debt because of student loans. This is a big percentage of the population starting off on the wrong foot, so to speak.
You just graduated and you are already in debt for the next few years of your working life. That is if you pay on time because if you don’t, you will be on the hook for a long time with penalties and interests as well. The good thing about this is that there are a number of repayment options available for you especially when it comes to federally funded loans.
As the new decade comes in, you can plan out how you will pay it off in the next few years. At the very least, you need to make the minimum payment on your loan for the first few years. As you get the chance to increase your pay or the income that comes in, you can gradually increase the amount you pay towards your student loans. Keep your lifestyle in check first and increase your debt payments so you can free up your income in the coming years.
Keep your credit card debt under control
One of the best ways to manage payment targets for the year is to make sure that you do not add any unnecessary items on that list. If you are already paying down a number of credit card debts you accumulated in the past years, it would be a good idea to keep frivolous expenses at bay in the next few years until such time you pay off your debts,
One of the biggest culprits to this list is accruing holiday credit card debt year on year. You end up finishing the year on the red because you failed to plan and save up for your holiday expenses. It can also be splurging every year on your birthday because you feel you deserve the treat on your special day. All these and a lot more boils down to planning for your expenses ahead of time.
To keep your holiday debt in check, plan for those expenses early in the year. Take a look at how much you spent on last year’s holidays and start saving up for it early. If you want to go on a vacation on your birthday, save for a nice trip for a few years. This can get you all excited and when you plan for a big one and spending less and even saving money every year becomes easy. The bottomline is that you need to plan for your expenses before they happen.
Save for your children’s college needs
As you look at the next ten years of your finances, it would make sense to start planning for your children’s college needs. For one, you have an idea of how challenging it is to start a career or get a business off the ground when you are riddled with student loans. You are already in debt even before you get your first paycheck.
If your children are a few years away from college, it is a good idea to save up for their cost of attendance. You can also help guide them in understanding their financing options if they are already going to college. Apart from what you can save, let them know ahead of time that they can explore scholarships and other sources of funding.
If you can help them plan ahead of time, they might be able to work on their grades as some scholarships have this type of requirement. You can also help them look at community colleges and how they can plan their college around it. All while you save for their expenses as well. It might be difficult to save for the whole ride but if you can lessen the amount they have to borrow, it will be a big financial relief for them already.
Make sure that you are on track for your retirement goal
One of the payment targets you can have for the decade is making sure you pay yourself first and save for retirement. As you should know by now, retirement is not a matter of “if” but “when?” The time will come when you need to retire at work and start living off on the money that you have saved up over the years.
There are a lot of retirement blunders you might come across in planning for your golden years but when you look at it over the next decade, you have plenty of room for improvement. You can plan out your investment options, slowly increase your 401k contribution. This is a good idea especially if your employer matches your contribution. It is difficult to achieve a lot in a year but if you look at it over a decade, you can plan out how to strengthen your retirement fund.
Create other sources of income
One of the strategies you can look into in order to help help you achieve your payment targets for the year is increasing your income. Being able to do so increases your chances of reaching your goals for the decade. There are a number of ways you can do this and since you are planning for the long-term, you can plan it out a little better.
Take for example your goal of increasing your base pay at work. This means you need to undergo skills improvement and you can do that with extra classes or workshops. You might even have to take up specific training from the company to get that promotion. That is a target you can work on in the years to come.
There are also people who are getting some side gigs to help them increase the income they get every month. You can plan this out really carefully and even consider your hobby as a take-off point. Look at how you can earn from your hobby and start offering your
The next decade is a great time to pin down some payment targets most especially the big-ticket items in your list. You can plot out and attain many financial achievements over this time frame.