With the arrival of 2025, January offers a fresh start—a chance to reflect on the year past and set intentions for the year ahead. Many of us take time to make personal resolutions; we focus on our health, pursuing a career change, or committing to self-improvement. However, it’s just as important to consider how your financial goals fit into your vision. Creating a financial plan that aligns with your goals for personal growth supports your immediate needs and fosters long-term success and having a strategy in place can provide the clarity and direction you need. In this post, we’ll explore how to create a financial plan that supports both your financial aspirations and personal goals.
To begin, it’s important to reflect on the past year. What financial and personal milestones did you achieve? Where did you face challenges? Reflecting on these areas provides insight into where you need to improve and what you want to focus on going forward. Consider how your financial goals can directly support your personal growth objectives. For example, are you planning to go back to school or earn a certification to advance your career? Do you want to prioritize health and wellness this year? By connecting your financial goals to your personal aspirations, you lay the foundation for a plan that feels meaningful and achievable.
Once you have a sense of what you want to accomplish, it’s time to set SMART financial goals. SMART stands for Specific, Measurable, Achievable, Relevant, and Time-bound. Setting clear, actionable goals will give you a roadmap for success and help you stay motivated throughout the year. For example, you might set a goal to save $10,000 for a down payment on a home by the end of the year, or you might aim to increase your retirement contributions by 5% over the next 12 months. The key is to break down larger objectives into smaller, manageable steps. When you define SMART goals for yourself it makes your plan of action much easier to determine than when your goals are vague like ‘I want to save for a house’ where you are left with questions like ‘how much do you want to save? When do you need this by?’, both key questions that need answers that SMART goals help address from the start.
So you have set your SMART goals that align with your personal priorities and values. Now it is time to create a financial plan that helps you to work towards those goals. Personal growth often involves investing in yourself — through education, wellness, career development and many other avenues. Consider how your finances can help fund these initiatives. If advancing your career is a goal, setting aside funds for education or skill-building courses or certifications could be essential. If health and wellness are a priority, allocating money for a gym membership, wellness retreats, or mental health resources may support your personal growth in meaningful ways.
A central piece of a financial plan is developing an actionable savings and investment plan. Maybe you decide you need a new savings account to save up for an exercise bike or a 529 college savings account to help you pay for college in a few years for you or a family member. This could also involve reviewing and rebalancing your current investment portfolio to ensure it aligns with your financial objectives. If retirement is a priority, consider increasing your contributions to your 401(k), IRA, or other retirement accounts. Automating savings is one of the best and easiest things you can do to help you stay on track without the temptation to skip contributions. Setting up automatic transfers into your savings or investment accounts ensures that you are consistently working toward your goals, month after month. While you can always save what is left over at the end of the month, often life and temptation eat away at your money, leaving you with nothing to save too often. Automatically saving before you get a chance to spend it is vital and the key idea of ‘paying yourself first’. If you need help with any of this one of our Wealth Management Advisors are happy to help you come up with these action steps.
Investing and saving are great for helping you get on track but you also must include contingencies in your plan if things don’t go according to plan. When you think back upon your progress last year, were your previous money goals derailed due to unforeseen expenses? This is where including an emergency fund in your plan that helps you deal with those unpleasant surprises is absolutely crucial. Additionally, that is why thinking about insurances like disability, long-term care, and life insurance, as well as making sure you have estate documents in place like a will, power of attorney, and health care directive can’t be overlooked. You may have a plan for your child, but you may also want life insurance to cover the cost of their college if you passed away unexpectedly or to make sure your will states who will take care of your child if you were to pass away while they are still a minor. These aren’t pleasant issues to consider but are vital to keeping things on track.
Tracking your progress is essential to staying on course, and regular reviews can help you assess whether your financial plan is on track. If you experience any significant life changes, such as a new job or a major move, adjusting your financial strategy to reflect these changes can help you stay aligned with your goals. Regular check-ins ensure that you’re not only progressing but also that you’re adaptable enough to handle shifts in your financial or personal life.
Investing doesn’t give you the benefit of hindsight even if you can look at past progress. In an example situation, you may decide to invest for retirement with a mix of 80% stocks / 20% bonds. If the market has a downturn, you may lose 20% of the value of your account. It is important to try to remove emotions from the equation – another place having a Wealth Management Advisor acting as an impartial outsider can help. If you are investing on your own, you may be tempted to move your money into something more conservative out of fear of experiencing further losses. A Wealth Management Advisor will help you step back and remember your time horizon, that you have time to recuperate the losses. Historically the stock market has risen back from losses and gone on to new heights. If you move your investments to cash when the market is down, you are likely to miss the gains that follow the losses. This is, of course, easier said than done, but it is key that we work to ‘buy low, sell high’ on average overall in our investment accounts.
Finally, remember to celebrate your milestones along the way. Whether you’ve met a savings target, paid off debt, or successfully invested in a new opportunity for personal growth, recognizing these achievements will keep you motivated and on track. Personal growth and financial success are both journeys, and every step forward deserves to be celebrated.
At Visions Wealth Management, we’re here to help you create a financial plan that aligns with your vision for 2025 and beyond. If you’re ready to take charge of your financial future, reach out to schedule a consultation with our team today.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.
Investing involves risks, including the loss of principal.
There is no guarantee that a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk.