What Are Your Financial Goals?
Let’s look at some examples of short-term, mid-term, and long-term financial goals and how setting a time frame with your goals can help you stay on track.
Short-Term Goals: Less than 1 Year
Short-term goals might include saving up for next year’s holiday shopping now or buying a new smartphone later this year. You can calculate how much you’ll need to save for the goal by taking the total cost and dividing by the number of months until your desired achievement date.
Example: You want to upgrade to a new TV six months from now. You compare prices online and find a model that costs about $450. If you save $75 per month, you’ll save enough money to buy the TV in six months.
Mid-Term Goals: 1 to 5 Years
Keep in mind that inflation may affect the amount you’ll need to save for mid-term goals. You may want to estimate high or add 3% (average rate of inflation) to the cost of your mid-term goals.
Example: You would like to treat your family to a seven-day Caribbean cruise three years from now. The cost of the cruise plus airfare to the port city is $3,280 for a group of four. Since prices for airfare and vacation packages will likely be higher in a few years, you estimate a higher amount of $3,600 for your trip. If you save $100 per month, you’ll save enough for the cruise trip in 36 months (three years).
Long-Term Goals: More than 5 Years
Inflation (rising prices) can have a significant impact on the amount you need to save for long-term goals such as retirement, college tuition, home improvements, and more. For both mid-term and long-term goals, you may need to estimate high or add 3% to the cost of your goal.
Example: You’re saving up for a major kitchen remodel in seven years. The average cost of a kitchen remodel now is about $21,000. With a 3% increase over seven years, you estimate the total cost could be close to $25,000. If you save $300 per month, you’ll have enough for the kitchen remodel in 84 months (seven years).
Start Saving Today
DCU is committed to helping our members acheive their financial goals. In an effort to help our members kickstart their savings, DCU's Primary Savings Account* pays a fantastic rate on the first $1,000 deposited. It's our way of encouraging our members to build up their savings and keep it there for when they need it.
Learn more about DCU's Primary Savings Account
*One Primary Savings account per person. Additional memberships receive one Savings Account. Rates may change after the account is opened and are subject to change weekly. Funds earn dividends from the first business day of deposit and are compounded and posted monthly. Accrued dividends are forfeited if account is closed prior to monthly dividend posting. Fees or other conditions may reduce earnings on these accounts. Refer to DCU's Truth-in-Savings Disclosures and Account Agreements and Schedule of Fees and Service Charges.