On this episode of In The Know: Money with Marsai Martin, we explore how to set achievable financial goals. PopCom founder and CEO Dawn Dickson talks to Marsai about strategies for setting financial goals and why reaching those goals might be easier than you think!
Before delving into the best strategies for setting and achieving financial goals, Marsai asks Dawn to talk about her own financial goals and how she achieved them. Dawn explains that, recently, her goal was to save enough money for her daughter’s college tuition.
“The most recent [goal] was to pay for my daughter’s college education, have it prepaid, [and] have the money in the bank for her,” Dawn tells Marsai. “Luckily, she got a scholarship, so I may not even need to use that, but that was a goal for me to make sure that she was covered.”
One of Dawn’s biggest long-term goals, meanwhile, was to save for her own retirement. “So for me as a 20-year-old young woman, I said, ‘I don’t want to work until I’m 65, that doesn’t make any sense to me. What can I do to prevent that?’” Dawn tells Marsai. “So the steps that I took were just, ‘Okay, I’m going to open up an investment account. I’m going to open up accounts that are IRA accounts or Mutual Fund accounts. I met with a financial advisor. I was very young doing this but I said, ‘Listen, I’m young. I only have $100 a month to save. Can you help me create a plan?’”
The sooner you can start setting financial goals, the more likely you are to achieve them, according to Dawn. Dawn began saving for retirement at age 20, putting aside small chunks of money at first, and slowly over time adding larger and larger sums.
Dawn’s advice to young people is to ask themselves, “What are we planning for?” Dawn recalls that early retirement was her big financial goal as a young person, but speculates that many young people may have more immediate financial goals to save for.
“Maybe some young people have to pay for their own college and they don’t have a parent that’s able to do that, so that would be a goal,” she explains. “’I’m going to college in 4 years. How can I start to set myself up?’ Talk to a trusted advisor and they can help you set that goal and take those steps.”
One of the best things young people can do for themselves financially is to find a financial advisor, according to Dawn. Money can be complicated, but a trusted financial advisor can help you not only determine your goals, but also figure out how to achieve them.
Of course, finding a financial advisor can be daunting to young people with limited experience in the world of finance. On that note, Marsai asks Dawn, “How do you find the people that you trust, especially in the finance world?”
“This is a tricky thing because I always go for referrals,” Dawn admits. “I’m thinking about as a young person who may not have any peers who have a financial advisor, I would probably go to a parent or to a mentor or even to someone online.”
It’s all about doing your research and finding someone you connect with. “It does take time to pick this person because you need to interview them, talk to them, and make sure they really click with you,” Dawn explains. “It’s a very close relationship, someone managing and advising you about your money, so you guys need to mesh.”
With or without a financial advisor, there are small things young people can do for themselves financially now that will have a big impact in the long run. The first thing? Understand the difference between being able to pay for something and being able to afford it.
“Paying for something and being able to afford something are very different,” Dawn tells Marsai. “Because affording it is the payment to sustain it, affording it is to maintain it, and affording it is to be able to not even notice that the money you used for it is out of your account. If you buy something and you’re [at] $0 dollars afterwards, you cannot afford it.”
Perhaps the most important piece of advice Dawn has for anyone trying to achieve financial goals is to invest in themselves. “Pay yourself first,” Dawn explains. “Save 10% of all money that you get. I save 20%, but at least 10% of money that you get, save it and do not touch it, because one day you’re going to need it.”
When it comes to achieving financial goals, consistency is key, according to Dawn. Her advice is to start saving early and to save money consistently, even if it’s just “10 cents of every dollar.”
Setting financial goals has allowed Dawn to save enough money to achieve her dream of early retirement. She is on track to retire at just 45 years old, and plans to spend the rest of her life investing in causes she cares about and pursuing the hobbies that interest her.
“I believe in entrepreneurs and I want to put my money behind them and help them to grow, so I’ll be doing that [when I retire],” she tells Marsai. “And then I start my yoga teacher training next week. I would like to be a yoga teacher after I retire from being a tech CEO, so that’s a new life for me.”
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