Investing for Major Financial Goals

Go out into your yard and dig a big hole. Every month, throw $50 into it, but don't take any money out until you're ready to buy a house, send your child to college or retire. It sounds a little crazy, doesn't it? But that's what saving without setting clear-cut goals is like. If you're lucky, you may end up with enough money to meet your needs, but you have no way to know for sure.

How to set your goals?
The first step in investing is defining your dreams for the future. If you are married or in a long-term relationship, spend some time together discussing your joint and individual goals. It is best to be as specific as possible. You want to end up with a list of goals. You can then decide how much money you will need to accumulate and which investments can best help you pursue your goals.

Looking forward to retirement
Retirement may seem a long way off, but it is never too early to start planning. The sooner you start, the more opportunity you have to let time do some work of making your money grow.

Some key points to keep in mind as you are planning for your retirement savings and investment strategy:

• Plan for a long life
• Think about how much you have until retirement, then invest accordingly
• Consider how inflation will affect your retirement savings

Facing the truth about college savings
Paying tuition costs definitely require forthought - and the sooner the better. With college costs typically raising faster than the rate of inflation, getting an early start and understanding how to use tax advntages and investment strategy to make the most of your savings can make an enormous difference in reducing or eliminating any post-graduate debt burden.

Consider these tips:

• Estimate how much it will cost to attend college and plan accordingly
• Research financial aid packages that help offset part of the cost of college
• Look into state-sponsored tuition plans that put your money into investments tailored to your financial needs and time frame

Investing for something big
At some point, you'll probably buy a home, a car, maybe event that yacht you've always wanted. Although they're hardly impluse items, large purchases often have a shorter time frame than other financial goals; one to five years is common.