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Many adults have to learn the hard way when it comes to managing their finances, mainly due to the fact that teaching this critical subject has never been a priority, for schools or for most parents (the latter of which never truly learned themselves). But if you’d rather avoid the hardships and setbacks that come with overspending, crippling debt, defaulting on payments, and even bankruptcy, it behooves you to get your own education where personal finance is concerned. And once you’ve learned the basics, such as keeping and balancing a ledger, creating a budget, saving, building credit, and investing, it’s time to start setting financial goals for yourself. But why is this necessary? What do you stand to gain by creating financial goals to work towards? Here are just a few reasons you might want to look at your finances and plan for the future.

1. Control your cash. If you’re like most adults paying their own way, you’ve no doubt come up against more than a few instances in which you wonder where your money goes. A huge number of people live paycheck-to-paycheck, spending their hard-earned money before they even receive it and slipping further and further behind by the minute. But believe it or not, being in control of your finances in 100% within your power. When you take the time to make a plan, starting with a budget that meets your current needs and then moving on to paying down debt and eventually saving money, you’re going to have a much better handle on where your money is going. With proper planning, you never have to feel helpless again when it comes to controlling your cash.
2. Live within your means. Most of us don’t enjoy sitting down to pay the bills, balance accounts, track the budget, and otherwise attend to financial concerns. But when you’re living within your means because you have a solid financial plan in place to guide you, there will be far less stress in your life. And when you start to see the fruits of your efforts through a growing savings account or investment portfolio, you’ll certainly feel better than if you were drowning in debt.
3. Avoid debt. Some lucky people are independently wealthy. They spend money like it grows on trees and trust their accountants to keep them rolling in dough. But the rest of us have to work a little harder if we want to avoid debt. Setting financial goals like cutting spending, paying bills, and growing a nest egg will help you to avoid major debt should you face an emergency situation like car failure, home repairs, or illness, for example, situations that could put you deep in the hole if you haven’t got some money in the bank.
4. Big-ticket items. If you really want a car, a house, a college degree, or a sabbatical overseas, setting financial goals is essential to realizing your dreams. When you set a goal and formulate a plan to help you reach it, you’re already a lot closer to the brass ring than someone who dreams big but blows their money on eating out and other unnecessary expenses.
5. Save for retirement. One of the smartest things ever said is that you have to spend money to make money, so why wouldn’t you spend money on your future? By contributing to compound interest accounts like a 401K or Roth IRA rather than putting your funds into low-yielding and easy to drain savings accounts (or worse, putting the money under the mattress, so to speak) you are virtually buying your future security. And the best part is that the money you contribute will work for you, earning even as it sits. So when you reach the age of retirement, you’ll have the funds you need to continue living the lifestyle to which you’ve become accustomed.