Budgeting / Investing

How To Take Charge Of Your Finances When You Don’t Have A Money Goal

By Monday, October 12, 2020

Image of coffee cup on calendar

The first time I thought about my finances was after I read an article about the increase in female retirees living in poverty. Shortly after, I discussed the topic with my mom; she admitted to me that while she could live off her retirement money if the rent and bills stayed roughly the same, any noticeable increase in her outgoings would drastically change that. I was shocked and wondered what it might mean for my own life-after-retirement if I don’t start thinking about that soon. However, it didn’t mean I immediately acted on this new knowledge. Planning for something that far in the future was not a financial goal that was immediately motivating (at least not to me).

Yes, you can start your financial journey even if you have no goal to work towards right now 

“Planning for something that far in the future was not a financial goal that was immediately motivating (at least not to me).”

For most, this thought is the first hurdle to overcome. For me personally, I have no dream of retiring at 40, I don’t want to buy a house and I have no large amounts of debt to pay off. None of these are bad things (and some make me very privileged, in a sense). However, lacking these more imminent goals make starting your financial journey even harder, but also, even more necessary. Why? Because you will find your goal and wished you had made the start earlier. Taking control of your money is something you should do right now and not later. If this year has shown us anything, it is that knowing your financial situation can be a lifesaver. 

What to consider when starting “goalless”

Organizing your finances for the sake of having more money in your bank account is one of the hardest things to do. But even without big financial goals, there are still things I enjoy doing or that I know I need to factor into my long-term planning. Since I love learning new skills, I know I will want to have money to make that happen. My family lives in a different country and my friends in different parts of the UK. This means I will need money to pay for travel to go and see them. Though none of these are life-changing goals to work towards, they are still things I know will need to make me happy. Even if you have no big financial goals, what are the ‘small’ things in life you enjoy? What are the things you want to have money for, that you can also plan for, even when the ideas are a bit abstract right now? Take some time today to think about these questions.

“Organizing your finances for the sake of having more money in your bank account is one of the hardest things to do.”

What pots to save money in 

In case you need some ideas for what you would like money for, here are the funds I put money into every month. They might just inspire you to start saving too.

  • Retirement

This is what started my financial journey, and I do believe it should be a priority question when you start asking yourself how you want to use your money. What the best option is, will depend on your location and situation. Time is on your side in this question. The earlier it becomes a topic you think about, the better.

  • Emergencies

If COVID taught us anything, it is how important an emergency fund is. The sad reality is that many people worldwide have lost–or will lose– their jobs. An emergency fund can help you and your family avoid immediate financial problems. How much you need depends on your situation, but a good starting point is saving at least three months’ worth of bills, rent/mortgage, and other necessities.

  • Flip the table

The name of this fund comes from the book, Manage Your Money Like A F*cking Grown-Up, by Sam Beckbessinger. It is my personal favorite. Being ‘goalless’ means you are in a great position to build this fund. It gives you the option to leave when you had enough of your job, your city or anything else that is making you miserable. This is obviously not meant as the first solution to these problems, but sometimes walking away is the best you can do for yourself and others. 

“Sometimes walking away is the best you can do for yourself and others.”

  • Education

As I mentioned, I love to learn new things. Spending money on something I want to learn is a very satisfying experience. I interpret this fund very loosely. So far, I have used the money to learn a new hobby. It is also a useful fund to work on skills for your career (especially if your employer doesn’t offer training).

  • Holiday/Trips

With family and friends living far away, travel is high on my list of priorities. This means it is something I put money into every month. You might want travel money for different reasons, but it will feel amazing to afford a trip without the need for credit. 

  • Treat yourself 

This is not the fund for the little treats, like coffee from your favorite café or a new book or lipstick. This should come out of your monthly allowance. The ‘Treat Yourself’ fund is for things like a day at the spa, the sustainably produced dress you want, or a fancy night out. Basically it’s for the treats that your monthly allowance doesn’t cover, but that we all need every now and then.

“I’m glad I assigned real use for my money and function to my finances.”

Endless possibilities

Even if you’re lacking a big, motivating financial goal, there will be things you prioritize having money for. Find out what you value in life and build your finances around that. I promise you, while not immediately as motivating as saving for a house or early retirement, it will feel amazing when you can afford something you want right away – all because you thought about your finances ahead of time! By putting money aside for learning new skills, I can now afford yoga teacher training, something that never even crossed my mind prior to when I started my financial journey. I am glad I assigned real use to my money. It gives me endless possibilities and I am grateful for that privilege. 

Annika is a writer, knitwear designer and soon to be yoga Teacher. She is originally from Germany but has found her home in the UK where she lives with her partner and too many books.  

Image via Pexels

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