|1.||Know what you're investing for.|
|>||Identify Your Goals|
|>||Prioritize Your Goals|
|>||Put a Date on Achieving Each Goal|
|2.||Make paying yourself a priority.|
|3.||Make tax-smart investments.|
|4.||Diversify your portfolio.|
Prioritize the goals you listed in Question 1. Still not sure how to prioritize? Consider this approach. In the next diagram, we ranked goals based on necessity, starting at the bottom of the pyramid with immediate needs and working our way up. Chart Explanation
Financial security. Do you want to buy a home? Are you on your way to creating a comfortable retirement? It's important to be honest with yourself. How much do you already have? How much will you need? You can't take out a loan for retirement, so this should be high on your list especially now that pensions are becoming more scarce and the future of Social Security benefits is in question.
Helping others. Do you have children or grandchildren? You may want to give them a helping hand paying for their college education. Or perhaps you'd like to donate funds to a favorite charity.
Making dreams reality. Are there things you've always wanted to do? Of course there are. Whether it's putting money away for a once-in-a-lifetime vacation, a dream house on the coast, or owning a winery, everyone has a dream they want to make come true.
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