Evolving goals

Once in a while you read about a successful person who claims to have known exactly what he or she wanted to do in life from age five and has never looked back. But that’s the exception, not the rule. Most people need time to figure everything out. That’s perfectly normal. Most people also change their minds regularly about what they want to accomplish.

So you should expect to come up with new goals, readjust your expectations for some old ones, and let some targets fall off your radar entirely. But making changes means that you’ll need to update your financial plan on a regular basis. You can compare it to visiting the doctor for a checkup every year or two to see how things are and if you should be doing anything differently. It’s the same with your finances: You need a regular checkup.

Furthermore, even if your goals stay the same, they get closer every day. Eventually, those midterm goals become short-term goals — and that may mean it’s time to switch your strategy. The same goes for your long-term goals. The day will come that they become mid-term goals, and then short-term, when achieving everything you planned for is suddenly within reach.

So what’s the schedule for reviewing your financial plan? A check-up once a year should help you stay on track, plus a major updating every time something big happens in your life — such as graduating from college, getting married, having kids, buying a house, or landing a new job or a big promotion, for example.