By Jill Fraser

Taking charge of personal finances begins with setting financial goals. But where to start and how to achieve them?

Self-made multi millionaires Justin Herald and Danial Ahchow (both of whom are profiled on FatCat) offer the following advice. Herald says, “be realistic and choose tangible goals”; Ahchow says, “it’s not about the money, it’s about creating the vision”.

Professor Chris Jackson, Australian School of Business, University of NSW recommends setting a hard and specific goal “because that will allocate your cognitive resources towards achieving that goal”.

He says; “those who have no idea what they want to achieve tend to drift”.

Suggested steps:

1) Identify your goals – short-term and long-term - in order of priority. Compounding interest will assist in attaining long-range goals. Money stashed in interest-earning savings accounts or invested in stocks and bonds grows and compounds.

2) A financial goal requires a road map and a journey needs a destination so one of the first decisions should be determining how you want your financial profile to look in 5, 10 and 20 years time. Consider putting pen to paper and diarising this because seeing it in black and white grounds it.

3) Ascertain what needs to be done on a weekly and monthly basis in order to achieve your goals and create a financial breakdown, budget and schedule accordingly.

4) Pat yourself on the back when you accomplish even tiny steps towards the ultimate goal. This will give you the motivation to retain focus and drive.

5) Begin now! Be prepared for change! Don’t let three steps forward and two back deter you. Keep going!

How do you go about setting your goals? We’d like to hear your story. Click here to discuss this on FatCat's MoneyConfessions