 TITLE: How to Set (and Reach) Your Financial Goals CONTENT: Examples of Financial Goals\n---------------------------\nYour financial goals are unique to you, but here are some common ones you may be working on.\n### Create a Budget\nA budget is a financial plan that's designed to help you live within your means, prevent overspending and encourage responsible financial habits. Creating a budget that works for you begins with understanding two key details: your income and expenses. The idea is to clarify how much money is coming in and going out on a monthly basis.\nCheck your recent bank account and credit card statements to review where your money goes, including your discretionary spending, fixed expenses and savings. Pick a budgeting method that feels like a good fit for your lifestyle and that you can see yourself sticking to. The 50\/30\/20 budget or zero-based budget are two popular approaches that can help you free up money to meet your other financial goals.\n### Build an Emergency Fund\nAn emergency fund is just that—a reserve of cash that's there for you when the unexpected happens. From home repairs to surprise medical bills, financial emergencies can come in all shapes and sizes. Having a solid emergency fund provides peace of mind that these expenses won't totally derail your budget. A robust emergency savings account can be the safety net that saves you from having to take on debt.\nExperts recommend socking away three to six months' worth of expenses in your emergency fund. This in itself can feel like a big goal, but something is better than nothing. Making room in your budget for monthly contributions to your savings account can add up quickly. Come up with a realistic target number each month, then set up automatic transfers to make it a habit. If you wind up tapping your emergency fund, be sure to replenish it as soon as you can.\n### Buy a House\nMany Americans are ready to go the extra mile to achieve their goal of homeownership. According to a 2019 Wells Fargo survey, 72% were willing to cut their expenses to save for a down payment. Almost half were open to taking a second job. If buying a home is on your bucket list, it's helpful to understand what to expect from the process. Working with a lender to get preapproved for a mortgage can clarify how much house you can afford. It can also help you ballpark your monthly mortgage payment and estimate how big of a down payment you need to save up.\nWhether homeownership is near or far, it's wise to monitor your credit. You can check your credit report from all three credit bureaus for free through AnnualCreditReport.com, and it's wise to do this several months before approaching mortgage lenders. Be on the lookout for past-due accounts, high account balances and accounts you don't recognize, which can all hurt your credit score. It's key that you also check your credit score, which you can do for free through Experian. Improving your credit can put you in the best position to get approved for a mortgage with a low interest rate. Continue paying your bills on time, and avoid making large transactions or applying for new credit during this time.\n### Save for Retirement\nSaving for retirement can feel like a tall order—especially if you haven't started yet. In fact, 56% of Americans don't know how much money they'll need to retire comfortably, according to a 2019 Northwestern Mutual study. If you feel behind here, know that the best time to start saving is now.\nLook first to your job to see if it offers an employer-sponsored retirement plan. Contributing to a 401(k) directly from your paycheck can help you build your nest egg while reducing your taxable income today. What's more, your employer may match a portion of your contributions. Opening an IRA is another effective way to save when a 401(k) isn't an option. If you don't have enough disposable income to contribute to your retirement, revisit your budget to see if you can cut your expenses and free up some cash.\n### Pay Off Student Loans\nThe average student loan balance came in at $38,792 in 2020, according to an Experian analysis. If your goal is to pay off your debt faster, begin by assessing your student loans: List out all your balances, interest rates and monthly payments. Paying more on accounts with the highest interest rates could save you the most money in the long run, but it might be more encouraging if you knock out those smaller loans first.\nYou might also consider refinancing your student loans. This involves taking out a new loan with a lower interest rate and using it to pay off your student loan balances. Accelerating your payments can help you pay off your debt faster and save you the most money over the long haul. END