Short term financial goals

short term financial goals

Establishing a financial goal can make it easier to stick to a budget and achieve financial independence. In fact, 7 in 10 U.S. adults vowed to set goals for themselves in 2023.1 

There are three different types of financial goals: short-term, mid-term, and long-term. Short-term goals can be achieved quickly and motivate you to set long-term goals that secure your financial future!

 Anyone can set and achieve financial goals if they commit to improving their personal finance habits. Keep reading to learn how to set and achieve financial goals for yourself! 

Types of Financial Goals (Examples) 

There are three different types of financial goals a person can make. Check out some examples of each type of goal below. 

Type of Financial GoalTime FrameExamplesKey Considerations
Short-Term Up to 1 year– Building an emergency fund- Paying off credit card debt- Saving for a family vacation– Usually requires less planning- Quick to achieve, offering motivation for other goals
Mid-Term 1 to 5 years– Buying a new car- Getting a degree or certification- Saving for a wedding– May require loans or financing- Need a more detailed financial plan
Long-Term5 years and beyond– Building a retirement account- Buying a home- Saving for a child’s education– Require long-term commitment- Can be investments like stocks or bonds

What Is a Short-Term Financial Goal?

A short-term goal is an objective you can meet within a year. Short-term goals do not require a lot of financial planning. Achieving short-term goals can make you realize how easy it is to successfully plan how to use your money. Common short-term goals people set for themselves include paying off debt, creating a budget plan, and starting an emergency fund. 

Paying Off Existing Debt

Debt repayment is a common short-term goal that many borrowers have. Being debt-free means you increase your monthly income and reduce your financial stress. 

Do you have a lot of debt to repay? You may see benefits without repaying every debt! Reducing the amount of debt you carry can improve your credit rating because credit debt counts for approximately 30% of a FICO score.

The most common forms of debt that consumers have in America include:

Creating a Budget Plan

Budgeting is essential because it ensures you spend your money wisely. However, only 32% of U.S. households prepare a monthly budget.2 A great short-term goal is to set up a budget plan for yourself! Following a budget can help you save money, achieve goals, and improve your finances. 

Starting an Emergency Fund

An emergency fund is essential for everyone to have. In the event of a financial emergency, you can avoid paying money to borrow from a lender! An emergency fund is a reserve for unexpected expenses, such as car repairs, medical debt, and unplanned travel. Starting an emergency fund is a great short-term financial goal because it provides you with financial security!  

What Is a Mid-Term Financial Goal?

A mid-term goal takes longer to achieve than a short-term goal but is not as time-consuming as a long-term one. Mid-term goals take between six months to a couple of years to complete. Common mid-term goals include getting a new car, getting a degree or certification, and saving for a wedding.  

Buying a New Car

Buying a new car is a common goal that people have. Vehicles are essential in America because public transportation is unreliable everywhere. You likely need one to get to work quickly, run errands, and transport family members. 

Most people rely on auto loans to finance a new vehicle purchase, but you may still benefit from saving up for a down payment. While you can avoid using a down payment, keep in mind that your monthly payments will be much higher. 

And if you have a bad credit score, you may get high-interest rate offers. It’s possible to use a credit card for a car down payment, but this is a costly option. Interest charges will add up to a significant amount if you carry a high balance. However, setting a goal can motivate you to improve your credit rating and save for a brand-new car!

Completing a Degree or Certification Program

Investing in yourself is a worthy goal because you increase your career and financial opportunities! Completing a degree or certification program takes time, so it is often classified as a mid-term goal. The time it takes to get a degree or certification depends on your student status (part-time or full-time) and the course length.  

Saving for a Wedding

Weddings are often lavish events, and most people end up spending an average of $28,000 for the ceremony and reception! Saving up for a wedding is a common goal for people. However, some people use a personal loan in addition to savings. Although financing a wedding ring with bad credit is possible, you will end up paying a decent amount of interest. 

When setting up a financial goal for wedding costs, also consider the type of venue you want and how many people you intend to invite. The venue is always the most costly factor, averaging about $10,500. When choosing a wedding date, take into account how long it will take to save up enough money for down payments.

What Is a Long-Term Financial Goal? 

A long-term financial goal takes several years to accomplish. A long-term goal is meant to help you secure your financial future and give your work purpose. A few examples of long-term financial goals you should consider include saving for retirement, a down payment on a property, or your child’s college education.

Down Payment on a House

A down payment lowers the cost of buying a real estate property. The more you save up for a down payment, the less you will pay monthly on a mortgage. You may think you need to save 20% or more of the purchase price, but this is not always true.

The amount you should have available for a down payment depends on the type of mortgage loan you want to use and the financial institution you work with. For example, the minimum down payment for an FHA loan is only 3.5% for borrowers with FICO scores over 580 points. 

Suppose you want to buy a $200,000 condo with an FHA loan. In that case, you only need to save $7,000 if your credit score exceeds 580, and you’re eligible!

Saving for Retirement

Retirement age seems like a lifetime away, but it will inevitably arrive. Saving for retirement early can help you afford a comfortable standard of living. There are different retirement accounts to choose from. The best one for you depends on your financial goals and personal job situation.

Saving for Your Child’s College Education

Getting an education is costly, but it is worth every penny! The price of annual tuition increases every year, but you can provide a sizable lump sum for your child’s higher education if you start saving now! Parents can begin setting money aside at any time. 

According to the College Board, a four-year public college will cost roughly $10,560 annually. If you want to fully fund your child’s college education, you should have approximately $42,240 in your savings.

How To Build a Savings Account in 5 Steps

In order to start saving money, you first need to determine how much you earn and spend within a month. Once you know how much extra cash you have available, you can plan how much to set aside monthly in an emergency fund. 

Step 1: Calculate Your Monthly Income

To calculate your monthly income, take a look at your bank statements or paycheck stubs. Ensure you use your after-tax income, as that is the actual amount you have available to spend. You will need to calculate your average monthly income if you do not earn the same amount every month. 

Financial experts advise adding up your income for the past six months to get an accurate estimate. Once you add up the total monthly income for the past six months, divide the total by six to get your average monthly income. 

Step 2: Calculate Your Monthly Expenses

Calculating your monthly expenses is more challenging since you have a mix of fixed and variable expenses. Take a look at your bank and credit card statements to calculate how much you spend every month. Knowing where your money goes can provide a clear picture of your spending habits and what bills you can cut or reduce.  

Step 3: Cut Monthly Costs

Once you know how much you spend every month, you may realize you are losing money on certain expenses. 

Suppose you have ad-free monthly subscriptions for HBO Max ($14.99), Netflix ($15.49), and Disney Plus bundled with Hulu ($19.99). Within one month, you will have spent $50.47! 

You don’t need annual financial planning with your financial advisor to know that you are losing out on hundreds of dollars annually! Determine which monthly bills you can cut to save money and improve your personal finance. 

Step 4: Create a Budget

Creating a budget helps you manage your money so you are able to save and spend on meaningful things. Budgeting can help you with debt reduction, income increase, goal achievement, and much more. Once you know your monthly income and expenses amount, you can choose a budget plan based on how you want to use your excess income. 

Step 5: Open a Savings Account

You can open a savings account once you reorganize your finances. Almost anyone can open a bank account! You can start the process online or in person at a local branch. You may be able to open an account on the same day! 

Most financial institutions will require basic information, a Social Security number, and a government-issued photo ID. You may have to provide a minimum opening deposit amount. Still, some banks and credit unions do not require any money upfront. 

How Can I Track My Monthly Spending?

Tracking all of your monthly expenses can make it easier to limit daily purchases and save money. Check out some ways to track your spending below. 

Expense Tracker Apps

There are several apps available to track your spending, such as: 

  • Mint — Mint is one of the best free expense tracker apps. Mint allows users to track spending, set bill payment reminders, and monitor their credit scores. 
  • Goodbudget — If you prefer a hands-on approach like the envelope budgeting method, use the Goodbudget app. 
  • Honeydue — If you have a partner, you can use the Honeydue app because it helps couples manage money together.   

Monthly Calendar

You can use a traditional budget calendar to keep track of your expenses. However, you do not have to spend money to track your expenses. You can find free printable calendars online that can help you track your spending. You can choose between daily, weekly, or monthly budgeting. 

Signing Up for Mobile Alerts

Many financial companies offer alerts that send you the amount and location of every purchase you make. Forgot how much you spent on food this week? You can check your text messages to see how much your debit or credit card was charged.

Frequently Asked Questions on Financial Goals 

How do short-term financial goals differ from mid-term and long-term goals?

While short-term financial goals are usually achievable within a year, mid-term financial goals might take between six months to a few years. Long-term goals can take several years to accomplish. Understanding the differences can help you prioritize your personal finance goals.

Can personal loans help achieve short-term financial goals?

Yes, personal loans can be a useful tool for achieving certain short-term financial goals, such as consolidating high-interest debt. However, it’s crucial to understand the terms and interest rates to ensure they align with your financial goals.

What are some examples of short-term financial goals?

Common examples include building an emergency fund, paying off a specific debt, or saving for a vacation. These goals are actionable and can be achieved relatively quickly, helping you gain financial freedom.

How can I set realistic savings goals?

Start by assessing your monthly income and expenses. Once you have a clear picture of your personal financial state, you can set achievable savings goals. Whether it’s for retirement savings or a short-term need, being realistic is key.

How does investing in the stock market fit into my financial goals?

Investing in stocks can be both a short-term and long-term strategy, depending on your financial goals. For long-term goals, like retirement planning, a more conservative approach is generally advised. For short-term goals, you might consider more aggressive options, but remember that these come with higher risks.

How can I make more money to achieve my financial goals faster?

Side gigs, freelancing, or part-time jobs can provide an additional income stream. The extra money can be directed towards your short-term financial goals, helping you achieve them more quickly.

How do I track progress towards my personal finance goals?

There are various apps and tools available that can help you keep track of your expenses, savings, and investments. Regularly monitoring your progress can keep you motivated and on track toward achieving financial freedom.

CreditNinja: Short-Term Financial Goals

It’s essential to have monetary goals. That way, you can make the most of your money and achieve your dreams. There are a few ways to go about achieving your short-term goals, such as using a personal loan from CreditNinja! 

We offer quick installment loans with competitive rates and flexible financial plans. You can use a personal loan for almost any unexpected expense. But before you apply, you should know the risks and benefits of using a personal loan for shopping


  1. Seven in 10 Americans Likely to Set Goals for 2023 │ Gallup
  2. Budgeting and Finance Statistics 2023 │ All New Business 
  3. FHA Loan Requirements │ FHA
  4. Retirement Accounts You Should Consider │ U.S. News & World Report
  5. Cost of your child’s college education │ CNBC
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