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Acknowledging that you need priorities is the first step! Most of us muddle through our financial lives, spending to meet the day-to-day expenses that dominate our attention. Unfortunately, that approach risks leaving your most important objectives unfulfilled.
“In order to achieve your goals, you need to make them concrete,” says New York City financial planner Annette Clearwaters. Here’s how to get started on fine-tuning your path:
Make a list. Write down a list all the things that you’d need to feel secure, happy or fulfilled. These can range from the weighty (getting out of debt) to the luxurious (a beachfront retirement home). As you write, try to define the goals as much as possible—in what oceanfront town? How many blocks from the beach? How many bedrooms?—and estimate a price tag for each.
CALCULATOR: How much am I spending?
Rank your list in order of importance. That’s not as easy as it sounds, since financial goals continually collide with one another. Paying for a child’s braces may rob money that would otherwise go into his college fund, for example. And saving effectively for your kids’ college can wipe out any hope of putting aside adequate money for your own retirement.
Read next: Stop Living Paycheck to Paycheck
If you are struggling to prioritize between two important goals, as yourself: Will one of the goals benefit more people than the other? Which goal will cause the greater harm if it is deferred?
Most people, for example, have to decide between banking money for the kids’ college tuition or their own retirement savings. If you know that you won’t be able to live adequately on the money you expect from your pension and Social Security, then retirement savings should be paramount. That child in college can take out a student loan, but there aren’t loans for retirement.
With all that said, there’s no reason you can’t tackle a few goals at once. “I think that builds motivation,” says Clearwaters. Just keep it to less than five, as having too many objectives will make it hard to get to the finish line on any of them.
Revisit the list in a few years. As the years go by, your priorities will change. So it’s good to re-examine your goals periodically. And of course, whenever you’ve completed one, you can bring another to the forefront.