1. 1.17.3.G1
Setting Financial Goals
“Take Charge of Your Finances”
Advanced Level

2. © Family Economics & Financial Education – Revised April 2011 –Values, Needs vs. Wants, & Goal Setting Unit – Setting Financial Goals – Slide 2
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
1.17.3.G1
Financial Goals
Learning to set financial goals is an
important part of learning to live
independently
Financial Goals -
Are accomplished through, & give
direction to, financial planning

3. © Family Economics & Financial Education – Revised April 2011 –Values, Needs vs. Wants, & Goal Setting Unit – Setting Financial Goals – Slide 3
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
1.17.3.G1
Financial planning-
A tool used to achieve financial success
based upon the development and
implementation of
financial goals
Many people follow a similar
financial pattern during their life
BUT
Everyone has an individualized
financial plan

4. © Family Economics & Financial Education – Revised April 2011 –Values, Needs vs. Wants, & Goal Setting Unit – Setting Financial Goals – Slide 4
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
1.17.3.G1
What are Goals?
Goal – the end result of
something a person intends to
acquire, achieve, do, reach, or
accomplish sometime in the
near or distant future
Financial goals – specific
objectives to be
accomplished through
financial planning
Education goals -
enable individuals to
prepare for future
success in the workplace

5. © Family Economics & Financial Education – Revised April 2011 –Values, Needs vs. Wants, & Goal Setting Unit – Setting Financial Goals – Slide 5
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
1.17.3.G1
Short-term and Long-term Goals
Goal
Short-term goals-
specified as less
than one year
Long-term goals -
specified as more
than one year

6. © Family Economics & Financial Education – Revised April 2011 –Values, Needs vs. Wants, & Goal Setting Unit – Setting Financial Goals – Slide 6
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
1.17.3.G1
The Importance of
Goal Writing
 A study in What They Don’t Teach You at
Harvard Business School by Mark McCormack
 1979- Students were asked, "Have you set
clear, written goals for your future and made
plans to accomplish them?"
 3% had written goals and plans
 13% percent had goals, but they were not in
writing
 84% percent had no specific goals at all

7. © Family Economics & Financial Education – Revised April 2011 –Values, Needs vs. Wants, & Goal Setting Unit – Setting Financial Goals – Slide 7
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
1.17.3.G1
And what about that 3%
 Ten years later….the 3% that had written
goals and plans were earning, on average, ten
times as much as the other 97 percent put
together
Why is goal setting
important?

8. © Family Economics & Financial Education – Revised April 2011 –Values, Needs vs. Wants, & Goal Setting Unit – Setting Financial Goals – Slide 8
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
1.17.3.G1
Setting Financial Goals Video

9. © Family Economics & Financial Education – Revised April 2011 –Values, Needs vs. Wants, & Goal Setting Unit – Setting Financial Goals – Slide 9
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
1.17.3.G1
SMART Goals
SMART Goals
Specific –
exact,
clearly
defined or
explained
Measurable
– A figure that
can be
objectively
assessed – ex.
A measurable
cost or time
Attainable –
Able to be
reached – ex.
A budget
amount that
can be realized
Realistic
– In
keeping
with
reality,
likely to
happen
Time Bound –
Containing a
date when a
goal will be
reached
Financial & Educational Goals should be
SMART goals

10. © Family Economics & Financial Education – Revised April 2011 –Values, Needs vs. Wants, & Goal Setting Unit – Setting Financial Goals – Slide 10
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
1.17.3.G1
SMART Education Goals
• State exactly what is to be done with the
education aspect involvedSpecific
• Write the exact grade or class that the
goal is forMeasurable
• Determine how it can be reached, which
is often determined by academic workAttainable
• Do not set goal for something
unattainable or out of reachRealistic
• Specifically state when the goal needs to
be reachedTime Bound

11. © Family Economics & Financial Education – Revised April 2011 –Values, Needs vs. Wants, & Goal Setting Unit – Setting Financial Goals – Slide 11
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
1.17.3.G1
SMART Education Goal
Goal
Specific
Measurable
Attainable
Realistic
Time Bound
I want to attend a four year college
Because I want to attend a four year college, I will earn a B in algebra
Because I want to attend a four year college, I will earn a B in algebra
this semester
Because I want to attend a four year college, I will earn a B in algebra
this semester to prepare me for the college entrance exam
Because I want to attend a four year college, I will earn a B in algebra this
semester to prepare me for the college entrance exam when I am a junior
I want to attend college

12. © Family Economics & Financial Education – Revised April 2011 –Values, Needs vs. Wants, & Goal Setting Unit – Setting Financial Goals – Slide 12
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
1.17.3.G1
SMART Financial Goals
• State exactly what is to be done with
the money involvedSpecific
• Write the exact dollar amount the
goal is forMeasurable
• Determine how it can be reached
(often determined by a budget)Attainable
• Do not set goals for something
unattainable or out of reachRealistic
• Specifically state when the goal needs
to be reachedTime Bound

13. © Family Economics & Financial Education – Revised April 2011 –Values, Needs vs. Wants, & Goal Setting Unit – Setting Financial Goals – Slide 13
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
1.17.3.G1
SMART Financial Goal
Goal
Specific
Measurable
Attainable
Realistic
Time Bound
I plan to save for a down payment on a new car
I plan to save $5,000 for a down payment on a new car
I plan to save $5,000 for a down payment on a new car by saving $200
from every paycheck
It is realistic to save $200 from each paycheck because I usually waste
the money on unnecessary items instead of saving it
I plan to save $5,000 for a down payment on a new car by saving $200
from each paycheck for two years
I want to buy a new car

14. © Family Economics & Financial Education – Revised April 2011 –Values, Needs vs. Wants, & Goal Setting Unit – Setting Financial Goals – Slide 14
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
1.17.3.G1
What influences a person’s
financial plan?
Many factors that
can be expected or
unexpected:
Financial
Planning
Values,
Goals &
Personal
Choices
Major
Life
Events
Life Cycle
Needs
Lifestyle
Conditions
Life Cycle
Needs

15. © Family Economics & Financial Education – Revised April 2011 –Values, Needs vs. Wants, & Goal Setting Unit – Setting Financial Goals – Slide 15
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
1.17.3.G1
The choices you make today
impact your future!
Choices and goals made in the
present may have a significant
impact on your future financial
plan
Financial
Planning
Values,
Goals, &
Personal
Choices
Major Life
Events
Life events that affect your
financial plan may be
unexpected

16. © Family Economics & Financial Education – Revised April 2011 –Values, Needs vs. Wants, & Goal Setting Unit – Setting Financial Goals – Slide 16
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
1.17.3.G1
What are examples of lifestyle conditions that
may affect a person’s financial plan?
Marital
status
Employment
status
Income
Age
Number of
dependents
Economic
outlook
Education
Health
status
Financial
Planning
Values,
Goals, &
Personal
Choices
Major
Life
Events
Lifestyle
Conditions

17. © Family Economics & Financial Education – Revised April 2011 –Values, Needs vs. Wants, & Goal Setting Unit – Setting Financial Goals – Slide 17
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
1.17.3.G1
Typical financial life
cycle pattern applies to
most people and affects
a financial plan
Financial Life Cycle
Life cycle - a series of
stages through which an
individual passes during his
or her lifetime Financial
Planning
Values,
Goals, &
Personal
Choices
Life Cycle
Needs
Major
Life
Events
Lifestyle
Conditions

18. © Family Economics & Financial Education – Revised April 2011 –Values, Needs vs. Wants, & Goal Setting Unit – Setting Financial Goals – Slide 18
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
1.17.3.G1
Typical Financial Life Cycle
$
Approaching
Retirement
Years
Retirement YearsSingle * Marriage * Start and Raise Family
0 20 30 40 50 60 70 80
Years of Age
Stage 1: Basic Wealth
Protection
Stage 3: Wealth
Distribution
Stage 2: Wealth
Accumulation

19. © Family Economics & Financial Education – Revised April 2011 –Values, Needs vs. Wants, & Goal Setting Unit – Setting Financial Goals – Slide 19
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
1.17.3.G1
What types of financial planning would occur
during each stage of the financial life cycle?
Stage 1
Stage 3
Stage 2
Stage 1: Basic Wealth Protection
(protecting your future) – focus
on building financial security
• Develop emergency savings
• Develop positive credit
• Begin investing in retirement
• Purchase insurance

20. © Family Economics & Financial Education – Revised April 2011 –Values, Needs vs. Wants, & Goal Setting Unit – Setting Financial Goals – Slide 20
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
1.17.3.G1
What types of financial planning would occur
during each stage of the financial life cycle?
Stage 1
Stage 3
Stage 2
Stage 2: Wealth Accumulation
(giving it to yourself)
Head of household has reached
peak earning years, is accumulating
wealth, and approaching
retirement
• Investing to build wealth
• Purchasing a home

21. © Family Economics & Financial Education – Revised April 2011 –Values, Needs vs. Wants, & Goal Setting Unit – Setting Financial Goals – Slide 21
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
1.17.3.G1
What types of financial planning would occur
during each stage of the financial life cycle?
Stage 1
Stage 3
Stage 2
Stage 3: Wealth Distribution
(giving it to your chosen ones)
The consumption of wealth,
usually during retirement
• Estate planning

22. © Family Economics & Financial Education – Revised April 2011 –Values, Needs vs. Wants, & Goal Setting Unit – Setting Financial Goals – Slide 22
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
1.17.3.G1
Financial Life Cycle Events
High
school:
13-17
Young
adult: 18-
24
Adult with
or
without
children:
25-34
Working
parent or
adult: 35-
44
Midlife:
45-54
Pre-
retiremen
t: 55-64
Retired:
65 and
older

23. © Family Economics & Financial Education – Revised April 2011 –Values, Needs vs. Wants, & Goal Setting Unit – Setting Financial Goals – Slide 23
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
1.17.3.G1
Traditional Age Group Financial
Planning Needs
 Developing a plan for eventual independence
 Preparing for career
 Evaluating future financial needs and resources
 Exploring financial systems – banks, etc.
 Developing a personal system of record keeping
High
school:
13-17
People in certain age groups tend to have similar financial
life cycle needs

24. © Family Economics & Financial Education – Revised April 2011 –Values, Needs vs. Wants, & Goal Setting Unit – Setting Financial Goals – Slide 24
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
1.17.3.G1
Traditional Age Group Financial
Planning Needs
– Establishing a household
– Training for a career
– Earning financial independence
– Determining insurance needs
– Establishing credit
– Establishing savings
– Creating a spending plan
– Begin investing in retirement
– Developing a personal financial identity
Young
adult: 18-
24

25. © Family Economics & Financial Education – Revised April 2011 –Values, Needs vs. Wants, & Goal Setting Unit – Setting Financial Goals – Slide 25
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
1.17.3.G1
Traditional Age Group Financial
Planning Needs
– Child-bearing
– Child-raising
– Expanding career goals
– Investing in retirement
– Managing increased need for credit
– Discussing and managing additional insurance needs
– Creating a will
– Starting an education fund for children
Adult with
or without
children:
25-34

26. © Family Economics & Financial Education – Revised April 2011 –Values, Needs vs. Wants, & Goal Setting Unit – Setting Financial Goals – Slide 26
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
1.17.3.G1
Traditional Age Group Financial
Planning Needs
 Upgrading career training
 Developing protection needs for head-of-household
 Investing in retirement
 Establishing retirement goals
 Building on children’s education fund
 Need for greater income due to expanding needs
Working
parent or
adult: 35-
44

27. © Family Economics & Financial Education – Revised April 2011 –Values, Needs vs. Wants, & Goal Setting Unit – Setting Financial Goals – Slide 27
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
1.17.3.G1
Traditional Age Group Financial
Planning Needs
 Assisting with higher education for children
 Investing in retirement
 Updating retirement goals and plans
 Developing estate plans
Midlife:
45-54

28. © Family Economics & Financial Education – Revised April 2011 –Values, Needs vs. Wants, & Goal Setting Unit – Setting Financial Goals – Slide 28
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
1.17.3.G1
Traditional Age Group Financial
Planning Needs
 Consolidating assets
 Re-evaluating property transfer
 Investing in retirement
 Evaluating expenses for retirement and current housing
 Planning future security
 Investigating retirement part-time income or volunteer work
 Meeting responsibilities of ageing parents
 Planning for long-term care insurance and medical care in
retirement
Pre-
retirement:
55-64

29. © Family Economics & Financial Education – Revised April 2011 –Values, Needs vs. Wants, & Goal Setting Unit – Setting Financial Goals – Slide 29
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona
1.17.3.G1
Traditional Age Group Financial
Planning Needs
– Re-evaluating and adjusting living conditions and
spending as related to health and income
– Adjusting insurance programs for increasing risks
– Finalizing will or letter of last instructions
– Acquiring assistance in management of personal and
financial affairs
– Finalizing estate plans
Retired:
65 and
older