Your Financial Goals Setting goals is an important part of any financial plan. Since there are so many expenses competing for your income, it is important to identify your short term, medium term, and long term goals. During most of your lifetime, you'll probably be working toward several goals at once, although financial planners often suggest that you have at least one month's take- home pay set aside for emergencies before you focus on other goals.
Many people find it helpful to set up a separate account for each goal.
Short term emergency savings should be kept in an account that is fairly easy to get to, such as a money market account or a savings account. For medium term savings such as money you plan to spend for purchasing a home or paying for your children's college, a personal mutual fund account or a prepaid college tuition plan may be appropriate. Retirement savings are ideally suited to the Deferred Compensation Program. When you begin setting financial goals for retirement, you'll need need to ask yourself a few questions.