Financial Goal Setting: Setting Your Family up for Success
Financial goal setting is important regardless of where you’re at in life.
As an individual, you’ve probably worked with a financial advisor to set your own financial goals.
However, as you get older, your financial goals will change.
Being part of a family means you need to consider not only your financial goals but your financial goals as a family.
Setting financial goals now doesn’t only impact you but helps to create generational wealth that enables your financial legacy to live on long after you’re gone.
Read on for more information about financial goal setting for your family and the impact of your financial legacy.
Why financial goal setting is important for families
Individual financial goals are essential – they set targets for you to achieve and are easy to measure your progress against.
However, if you start a family, these goals will need to shift to focus on every member of the household.
If you’re living with a partner, you might choose to combine finances meaning your discussion needs to change from ‘my money’ to ‘our money’. It’s the same with your goals.
If you are sharing finances or have dependants, there’s a strong chance that you will need to change your personal financial goals.
Financial goal setting is also how you can create generational wealth and leave a lasting financial legacy for generations to come.
It’s about not being selfish with your money and making sacrifices, knowing that the decisions you make today affect future generations.
Generational wealth – or your financial legacy – looks at the wealth passed down from one generation to another.
By leaving behind an inheritance to your children or grandchildren, you are helping to contribute to growing your family’s wealth. This can come in the form of money, property, shares, or other financial assets.
Although many believe that wealth is only reserved for those who are ‘already wealthy’, this is not the case.
Wealth can be built at any stage of life as long as a strategic plan has been put in place with the help of a knowledgeable financial advisor.
Why is generational wealth important?
It may be hard to grasp the importance of generational wealth – especially in a world where instant gratification is so prevalent.
However, building generational wealth can assist future generations and release them from financial burden, allowing them to pursue other pathways.
For example, if your parents can pay off debt from further education, you’re free to start saving for your first home, paying off other debt or even planning for retirement without worrying about the burden of educational debt.
There are plenty of examples, but for those who are wanting to start a family, generational wealth is especially important when thinking about how to set your children up for financial success.
Consider your current financial lifestyle and how that will impact future generations.
Taking the time to educate yourself and future children about the value of your finances is an important part of your legacy. Remember, the decisions you make today will impact generations for years to come.
Even small sacrifices can make a big difference.
How can I build generational wealth?
Building generational wealth comes down to setting financial goals that will benefit others when you’re gone.
This could be in the way of acquiring assets or saving cash that you don’t intend on spending during your retirement. We know – this is easier said than done, especially for those struggling to build and maintain their own savings.
The first step to building generational wealth is to establish your short and long-term financial goals.
By setting these goals, you’ll be able to prioritise what’s important to you and what you’re looking to leave behind. Investing in property or shares or putting aside cash are a few of the most common goals to build this wealth.
However, there are so many options that can be customised to your financial situation.
Working with an experienced financial advisor who can guide you through the goal-setting process and tailor these goals to your vision is crucial.
At Inovayt, our expert team of financial advisors have experience creating and building upon generational wealth, no matter what stage of life you’re from.
Examples of family financial goals
You might be wondering what sort of goals to set when it comes to building generational wealth.
Some of the most common goals that help to set up your financial legacy include:
- Becoming debt free
- Buying an investment property
- Becoming financially independent
- Learning to invest your money
- Creating and maintaining budgets to increase cash flow
Buying an investment property, for example, is one goal you can set that can benefit not only you but future generations, too.
Consider the following scenario:
You and your partner purchase an investment property that you then pass down to your child in your will.
Your child then decides to use the property as a rental and uses the earnings to buy additional investment properties and grow their business, which they leave in their will to their children.
Their children then access wealth through the investment properties and business that has been handed down.
This flow-on effect is one way that generational wealth can be demonstrated.
Financial goal setting is crucial when it comes to generational wealth and leaving a financial legacy.
Although it’s a common misconception that generational wealth only comes from wealthy families, everyone can create wealth to pass on if they have the help of a trusted financial advisor.
Creating a strong financial legacy gives you the peace of mind that your selflessness is setting your family – and future family that you’ll never meet – up for success.
If you’re looking to start a family, your financial goals need to change, and the concept of generational wealth needs to be considered, as these goals aren’t just affecting you.
You’re making decisions and sacrifices today that will affect future generations.
Our expert team of financial advisors have the knowledge and experience to take your financial goals and elevate them to leave a lasting financial impact.
Get in touch with one of our team financial advisor members today to start planning how to leave your legacy.