Setting Financial Goals is Empowering Futures

 

financial goal setting

As Africans, we struggle with keeping our finances in order and sticking to a plan. Unlike other cultures where people first seek financial help from institutions, we look for family and friends, then the institutions. We say a problem shared is “a problem half solved.” This was the birth of the “black tax,” which derailed many of our plans. I won’t say it’s terrible, as I have been a beneficiary of it, but it messes with people’s plans. 

Today’s focus was not “Black tax”; however, I wanted to talk about having financial goals and how they can benefit the African population to realize greater wealth, prosperity, and financial independence. 

Here is how you can go about setting up your plan for future success:

 

       i.           Self-Assessment

 Knowing where you stand financially is the first step towards setting meaningful and achievable goals. Start by assessing your current financial situation. You must understand your current and expected income, expenses, debts, and savings. This way, you clearly understand what you are working with and towards.

 

     ii.           Identify Your Goals 

Next, identify what you want to achieve. Your goals could be short-term, like saving for next semester’s school fees or December vacation, medium-term (like buying a car/plot), or long-term (like retirement). Be specific about what you want to achieve and by when.

 

   iii.           Prioritize Your Goals

Not all goals are created equal. Some are more urgent than others. Prioritize your goals based on their importance to you. This is where you weigh what that ‘Black tax’ means for you; can they do without your support? Can they get assistance from somewhere else, but they would instead ask you since they know they won’t pay back? 

Sometimes, it’s best to let people know that even though you have money, it’s planned for, and their problems are not your problems, but it will require your discretion on who and what to turn down.

 

   iv.         Make Your Goals SMART 

SMART stands for Specific, Measurable, Achievable, Relevant, and Time-bound. Making your goals SMART can increase your chances of achieving them. The term can seem cliche for some, but unless you stick to this approach, you will face hindrances on your path. Take time to formulate the goals and be true to yourself.

 

     v.           Create a Plan 

Once you’ve identified, organized, and prioritized your goals, create a plan to achieve them. This will involve creating a budget, reevaluating expenses and investments, and maybe looking for ways to increase your income.

 

   vi.           Implement Your Plan

Put your plan into action. This might involve setting up standing orders to your savings account, cutting back on non-essential spending, or seeking professional advice on investing. In Africa, we are used to asking for financial advice within groups and investing in what others are investing in, sometimes mindlessly! Which is a catastrophic way of using your hard-earned money. 

Financial institutions have desks where you can get informed and vetted advice that you can utilize at zero costs. Also, financial advisors are there to offer knowledgeable guidance. Utilize their skills even at a fee, saving you from a considerable loss.

 

 vii.           Monitor Your Progress 

Schools have exams to monitor students’ progress toward graduation goals. The same should be the case with finances; regularly review your progress towards your goals to keep yourself motivated and make adjustments if needed.

 

viii.           Celebrate Milestones

Celebrate when you reach milestones along the way to your larger goals. When you buy that car you have saved for three years, drive to a town or neighboring country as you enjoy your win; live that moment! This will keep you motivated and make the financial planning process more enjoyable.

SMART Goals

Why Financial Goals Matter

You could be wondering why you need to set financial goals while achieving what you have without one. I would ask myself the same question if I didn’t know better. Forgive me if I said you don’t know better. Please allow me to share with you why you need to take the time to formulate a road map that will help us reshape Africa’s fortunes.

• Guiding Your Financial Journey

Clear financial goals provide a guide for your financial planning. They help you prioritize your spending and ensure you put your money towards what matters most to you. For most of us in African countries, the importance of financial discipline cannot be overstated. 

Establishing financial goals requires a disciplined approach to budgeting and spending, leading to habits that can withstand economic uncertainties. Cultivating discipline involves saving and making informed choices that align with your long-term financial objectives.

• Breaking the Cycle of Poverty

For too long, the poverty cycle has gripped various African regions. Setting financial goals can help you stay motivated and on track, ending your family’s cycle. It allows you to monitor your progress over time. Seeing your successes can drive you to keep moving forward and encourage others. 

Whether saving for education, starting a small business, or building an emergency fund, each goal becomes a stepping stone toward economic liberation. If replicated by 5-10 people from every locale, the fruits will be seen quickly, others will adapt, and Africa will adopt and grow.

• Maneuvering Economic Uncertainties

From a financial standpoint, setting achievable goals may be one of the most effective things you can do to set yourself up for future success and shocks. African economies face unique challenges, from currency fluctuations to market volatility. Setting financial goals will equip you with a roadmap to navigate these uncertainties. Emergency funds, diversified investments, and strategic savings can shield against economic storms, providing stability during the unpredictable.

• Empowering Entrepreneurial Ventures

In most cases, achieving life goals goes hand in hand with achieving financial goals. Entrepreneurship is a driving force in global economies, and financial goals serve as blueprints for aspiring entrepreneurs, guiding us in our quest to establish and grow successful businesses. Your finances affect every aspect of life; financial goals are pivotal in realizing entrepreneurial dreams, whether securing capital, expanding market reach, or ensuring sustainability.

• Educating Future Generations

As Africans, we face this predicament now since the previous generations did not put much effort into setting and achieving financial goals. We, therefore, need to invest in financial literacy at the elementary level, which will help set goals towards financial freedom. 

Education is an investment in the future for the whole African continent and just for the household’s prosperity. Financial plans that revolve around education, for oneself or future generations, contribute to breaking the cycle of limited opportunities. Education-focused financial goals lay the foundation for knowledge, empowerment, and upward social mobility.

• Bridging the Wealth Gap

Numerous studies have indicated that goal setting is associated with greater self-confidence, which is vital to imagining great things for yourself. What sets people apart is the availability of resources and the confidence in their goals. Financial inequality is a global challenge, and Africa is no exception. Setting financial goals is a proactive step in bridging the wealth gap. By creating opportunities for wealth accumulation, individuals can contribute to the overall economic upliftment of their communities and, subsequently, the continent. 

• Long-Term Financial Wellness

Beyond immediate financial needs, setting goals fosters long-term financial wellness. Whether planning for retirement, homeownership, or generational wealth, a strategic approach to financial goal-setting ensures that individuals survive and thrive in the years to come.

In conclusion, the importance of setting financial goals in Africa extends far beyond individual aspirations. It’s a collective journey toward economic empowerment. As you set and achieve your financial goals, the ripple effect builds stronger communities and, ultimately, a thriving continent. 

Remember, reaching your most extensive legacy goals starts with setting realistic, comprehensive financial goals here and now.