The next step in the budgeting process is: Prioritize your goals. This process helps you "plan" for the most important projects.

There are two types of goals:

• Short range goals

• Long range goals

It is best to have both of these goals.

Short range goals

Generally, you will prepare a short range goal for the period of time covered with each pay check your receive. If you get paid weekly, the plan will include all your expenses and income for one (1) week; if you get paid bi-weekly, the goal will

include all expenses and income for two (2) weeks, etc.

Your short range goals may include things like:

• pay your rent

• pay utilities

• buy weekly food

• pay weekly child care

• buy weekly gasoline

Each of these goals occurs in a short span of time and many of them may be recurring. You will include these short range goals in your working budget. Maybe you have set short range goals, even though you may not have realized what you

were doing. A goal doesn’t change whether it is a mental thought or a written statement. It becomes much clearer and more realistic, however, when you have taken the time to write it down. As you can see, in order to meet your short range

goals, you need a job that provides you an income to pay for those goals.

Long range goals

Your long range goal will span sometimes only one (1) month, six (6) months or could span one (1) year or more. Your long range goal is determined by how long it will take you to accumulate the money to meet the goal. There are variables

that enter into that decision. How much does the goal cost? And how much are you setting aside each pay period to work toward that goal?

Your long range goals may include things like:

• buy house

• buy new clothes

• buy new furniture or appliances

• buy car

• pay off bills

• education

• vacation

The long range goals, however, require not just an income, but also a plan for money to be accumulated to pay for these goal items. A savings account provides the avenue to accumulate this money. The savings account becomes a line item in your budget process. Saving money is generally, the only way individuals, today, are able to accumulate the funds required to purchase a home.

Now we just have to work on prioritizing those goals.

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