It has been proven that we cannot multitask as humans. However, what if I told you that your money could and it is easier than you think? Let me share with you how to save for multiple financial goals at once.

We all have different wants and needs but there are probably a few in common on the horizon: a nice vacation, a new home, college for your children, and eventually retirement. It will also make a difference where you are in your financial journey. Are you fresh out of school? Have you been peeking around the corner at retirement? Putting money aside in a savings account is a good start but it probably will not be enough, especially for multiple needs.

First, set your strategy!

Without having a master plan, you won’t be able to stick to it and will likely not meet any goals. Each goal should have both a savings and investment piece. First, make a short list of your goals. Next, identify which are needs and which are wants. Identifying needs vs. wants can help you begin to prioritize. You will likely want to retire one day so that can be high on the list but you should also have an emergency fund of three to six months of living expenses. After that, you can fill in wants and wishes, such as vacations and new vehicles.

After you establish your goals, you need to determine a timeframe for each. This is important for determining what types of investments will best help you reach your goals. For short-term goals, the timeframe is often within the coming two years, like a vacation. For short-term goals, you should invest your savings in more stable, low-risk investments like money-market funds, short-term Treasury bonds or certificates of deposit.

Something you need in three to ten years goes in the intermediate bucket and can be a mix of intermediate-term bonds or bond funds and stock. A goal in this bucket could be saving for your child’s college education or a down payment on a new house.

Hopefully, you have time to save for retirement and that can go in the ten-years plus bucket. A large portion of this may be in stocks with a focus on growth or growth and income.

“Do not save what is left after spending but spend what is left after saving.” Warren Buffett

None of these buckets are set in stone and they should be based on your personal preferences and tolerance for risk. You should also spread out your investments so you aren’t relying on one source for a major financial goal.

Next, take action!

Now that you have identified your priorities and determined the timeframe for each, you should start saving. Even if you begin with small contributions, consistently made over time they will create a big payoff eventually. One strategy is to buy a fixed dollar amount of an investment on a regular schedule, even if the price fluctuates. This is called dollar cost averaging. This would mean buying fewer shares when the price is high and more when it’s low. Be mindful of your priorities and put money in the most important ones first. That’s why we identified them!

Have you ever had a project and were really excited at first but then after a few weeks or months it kind of faded? Don’t do that with these! Once your plan is set and your investments are initiated, keep contributing and also checking on them about once a quarter. As your deadline for needing the money for a goal approaches, you should become more conservative with your approach. Moving away from stocks and into bonds may be more appropriate.

Don’t be afraid to make adjustments

Naturally, you should also reassess your goals and priorities along the way. Life happens and you may need to purchase a new vehicle to replace the family car or maybe you move into a city and no longer require a personal vehicle. You will also achieve some of your goals (yay, you!) and can add more wants and wishes to the list.

Most of these goals take time and it can feel like you aren’t making any progress. If you have a need for instant gratification, put a few dollars in an envelope and save for some smaller items. Are you excited to have a nice meal away from home at a new restaurant in town? You can put money aside for this and experience the efforts of your hard work sooner!

Be sure that you are also taking full advantage of savings opportunities. If your employer offers matching contributions to retirement savings, make sure you are getting the most you can. When it comes to saving for college, 529 college savings plans can be a smart way to save on taxes. A 529 allow your child’s college education fund to grow exempt from federal income tax. Your state may also offer additional tax advantages.

This can be a lot to take in but take it step by step.

How to save for multiple goals at once in 5 steps

  1. What are your priorities?
  2. How soon do you need the money for this goal?
  3. Once they are divided into timeframes, make the appropriate investments based on risk and your tolerance for that risk.
  4. Check in at regular intervals to ensure the investments are performing as you need them and, if not, adjust them.
  5. If you are stuck at any point, contact a financial advisor. We can help guide you through the steps and help you make the best decision for your needs.

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