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Set goals to ensure financial health in 2012

There's no doubt that financially, 2011 was a tough year. The recession is, well, receding, but we've got a long way to go yet. With a new year looming, it would be wise to start planning and making your financial goals for 2012. Setting realistic goals is a great first step.

• Set both short- and long-term goals. Short-term goals include things you want to accomplish in the coming year like reduce your debt or build up your emergency cash fund. Long-term goals might be things like saving for your children's education or putting money away toward an early retirement.

• Set your budget, love your budget. Some people may look at budgeting as a chore or a heavy weight to bear, but having a set budget can actually be quite freeing. Once you've set yours, stick to it and you'll not only be guilt-free, but you'll be in better shape financially.

• Determine your priorities. Figure out what matters most to you, and focus on those things. 

If you've figured out what's most important to you, you'll want to follow three simple rules. First of all, spend less money. Be sure, before any purchase, to ask yourself if spending this particular amount of money will help you achieve your goals. If you are even slightly unsure, it's best to not spend it.

Second, save more. Putting more money away for a rainy day or emergencies is never a bad thing, and saving toward retirement also has to be a priority. 

And last, make sure you invest your money wisely. Don't put all your eggs into one basket, and remember to reevaluate your investment goals periodically in order to be sure you're still on track with your overall financial goals. 

No matter what your goals are in the coming year, spending less and saving more, as well as investing wisely, will surely help you stay focused on your goals and get even closer to making those goals a reality.

Published Dec 29 2011, 11:27 AM by moneycoach
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