Setting your financial goals is THE first step to life planting and planning a future you want to live! A financial goal is any objective that you have to spend money on (ex. Buying a house, Retirement).

By setting your financial goals for 2020 and for the future, you will have concrete objectives that you work towards and hold yourself accountable. Without having financial goals, it is impossible to measure your success and plan a future you want to live. That’s why in this article, you will learn about 4things to consider when setting your financial goals.

1. LIFESTYLE:

Everyone has a different definition of what type of lifestyle they want to live. I believe a person’s lifestyle can be captured in a spectrum between a frugal and a luxurious lifestyle.

Someone who lives a frugal lifestyle tends to live on the bare minimum. They try to cut down their living expenses by living in a smaller home and avoiding large expenditures such as travel/luxurious goods. People who live a frugal lifestyle can also use many cost-saving strategies such as price-matching when grocery shopping, and point rewards.

Meanwhile, someone who lives a luxurious lifestyle tends to have more expenses from living in a large home, brand name luxury goods, and expensive activities/hobbies.

However, everyone one has a different definition of both frugal and luxury living. That’s why you should try to determine where you are on the spectrum. Either lifestyle is perfectly fine, but it will significantly influence your financial goals. If you want to live a luxurious lifestyle, you will need to be able to have an income to support all your additional expenditures.

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2. LOCATION:

The next thing to consider is WHERE you are going to live. If you are like me and from the Greater Toronto Area (GTA), the housing prices in Toronto have skyrocketed over the past 5 years. Five years ago, the average price of a condo was about $600,000, and today it is about $850,000.


You may want to live in Toronto for your job or to be near your family or friends. However, you have to consider the consequences of living in a city with such a high cost of real-estate. If you are planning to buy a condo, you’ll need at least a 10% down payment of around $85,000. And lets say in 5 years you are able to save that amount, the average price of a condo might be even higher!

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As for me, I think I’ve given up hope trying to live in Toronto LOL. Personally, I’d rather live a peaceful life in a smaller city once I’m ready to settle down. I am not a big city person and I actually get a bit stressed when I’m in the big downtown morning rush hours. This works out because I won’t have to worry about saving an unreasonable amount to live in a square box in Toronto.
So whether you choose to live in an expensive city or in the suburbs, make sure you decide where you want to live when creating your future financial goals. 

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3. LIFE PARTNER:

The next thing to consider is who your life partner is going to be or if you even want to have a life partner! I know for us 20-30 year olds this can be a happy or touchy subject haha but it is definitely something important to consider when creating your financial goals. 

If you do decide to have a partner, your income will be merged to achieve your joint financial goals such as buying a house and raising a family. To determine your future financial goals, you have to take into consideration what you future life partner’s income will be. Will they be making the same, more, or less than you? I know money is not the most important aspect of a relationship, but in a realistic world the person that you choose to be your life partner can dictate the type of lifestyle you will live. I knew many strong couples that ended up not getting married or have their marriages fall apart due to financial issues.

I’m not a dating life guru, but to create realistic future financial goals, you should have a minimum expectation or requirement of the level of income on your future life partner.

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3. RETIREMENT:

I know retirement is probably the last thing you are thinking as a recent graduate, but it is definitely something that you have to consider when planning out your financial goals. 

Saving for retirement is extremely important because once you are old, you won’t have the energy or capacity to work and make money. That’s why when you are young, you can work hard and make money now, so that in the future when you are old, you can afford to live.

Another factor that you should take into consideration is when you are going to DIE! Not to be morbid, but imagine you are 90 years old, and you run out of retirement savings. It would be very unfortunate and probably impossible if you had to go back to work at 90 years old. To estimate when you might die, you can ask past family members and take an average. 

Therefore, the total amount that should be in your retirement financial goal the estimated annual expenses during your retirement, multiplied by the # of years in retirement.

Retirement Financial Goal = Annual Expenditure * (Retirement age – Age of Death)

If you want to learn how to save for your retirement, start by using an RRSP

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Future Financial Goals:

Overall, there are the 4 main factors to consider when creating your financial goals. (1) Lifestyle, (2) Location, (3) Life Partner, (4) Retirement 

If you take these into consideration you can create realistic and attainable financial goals that you can work towards! I am in the process of creating a financial goal planner where you can set your financial goals. Sign-up here if you are interested in it!

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