IN TERMS OF TIME FACTOR
By time factor, we can classify financial goals into two categories:
SHORT-TERM FINANCIAL GOALS
Short-term goals are tied to your current financial health, based on your actual income. These goals need to be accomplished in less than one year. Therefore, you need to make a savings plan for that goal on a regular basis. You can also take advantage of credit institutions to help you achieve this goal, provided you have a clear repayment plan.
For example: Tuan needs to buy a new motorbike in the next two months, otherwise it will affect his work and as a result his income will also be affected. In this case, he needs to find another way to generate income for the purchase of a motorbike if the income from his current job is not enough to achieve this goal.
MEDIUM AND LONG - TERM FINANCIAL GOALS
These goals need to be accomplished over a period of more than one year. Therefore, long- term goals are also associated with your personal development and income growth. Long-term goals require a clear plan, which is broken down into steps to help you accomplish it according to your ability.
For example: Tuan has a girlfriend and plans to save some money in the next 5 years. He then plans to get married and use that money plus a mortgage loan from the bank to buy a 60 m2 apartment for about VND 3 billion. Thus, within the next 5 years, he and his girlfriend need to set a minimum financial goal of about VND 1 billion (1/3 of the apartment’s value), and his monthly income should reach about VND 40 million to guarantee a bank loan and take care of his small family.
IN TERMS OF CONTENT FACTOR
Based on the specificity of the financial goal, one may have the following types of financial goals:
INCOME GOAL
Mai predicts her income will increase by about 30% after 2 years of working. The basis for this goal is that Mai must try to do well in her current job to be promoted to team leader.
SAVINGS GOAL
Because his parents can't afford to support him, Tuan will need to set aside some money every month for getting married and starting a family. He expects to save about VND 500 million in the next 5 years.
SHOPPING/CONSUMPTION GOALS FOR WORK AND LIFE
Goals for work and life: It could be buy a motorbike, a phone, a laptop, etc.
FINANCIAL SUPPORT FOR RELATIVES
For example, medication costs for parents or tuition fee for siblings.
PROVISIONS FOR SICKNESS AND INJURY
For example, life/health insurance or car loan insurance.
A financial plan needs to be specific, measurable, and achievable. A goal that is out of reach can leave you feeling tired and frustrated when you achieve it. However, a goal that is too easy can cause you to lose motivation and miss the opportunity to reach your full potential. Once you’ve set a goal, you can move on to the next step: Building your own financial plan.