Set Goals That Will Inspire Success.

Don't set vague goals. Set goals that will inspire success. Don't just say you want to invest and save for the future. Make the concept more concrete. Think of how you can save for a new car, a college degree, a new house, a family. If you set vague goals, such as fianancial security or a good retirement, you'll have trouble measuring your progress along the way. You may even struggle to maintain interest. Vaguely defined investment goals can lead to halfhearted efforts to achieve them. It is better to set goals that you can grab onto. Instead of financial security, why not one million dollars net worth by age 60?

Don't just think about your dreams. Think about how much your dreams are going to cost. Set goals that will inspire success. Setting investment goals is a lot like reading a road map: Before you can get to where you want to go, you will have to figure out a starting point. The starting point is very important. You will never reach any destination without a starting point.

There are not any right or wrong investment goals. Most people have several goals at once. Here are some scenarios that include different types of goals:

1. Short term goals. Suppose a new car is one of your goals and you would like to purchase it by next summer. With such a short time horizon, the stock market would not be a good place to invest money because of the swings. You don't want to have to sell at a lost at the time you are planning to buy your car. Low risk vehicles such as bank certificates of deposit and money market funds are your best option. That way you will have the money you need when you get ready to purchas your car.

2. Medium-term goals. Suppose you want to purchase your first home in seven years. With more time, you have more options. Safety of principal is still important but you are in a better position to ride out down times in the financial markets and take o a little more risk. For medium-term goals, consider longer term certificates of deposit that pay more interest. Bonds are another option. You could even consider mutual funds that invest in stocks that pay good dividends but don't fluctuate much in price. That could give you high income, a chance to ride along if the market zooms up, and pretty good protection against all but a steep drop in stock prices.

3. Long-term goals. A secure retirement is the most common financial goal. A college education for your children is another long-term financial goal. For long term goals like these, you can afford to take more risks. There are a wide range of possibilities: stocks, corporate and government bonds, and long term certificates of deposit for diversification. You can also take advantage of all of the retirement plans so that your earnings can accumulate on a tax deffered basis.

You must also understand that as time goes on your investment goals will change. It is important to reasses your investment goals periodically. Remember to set goals that will inspire success.

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