It’s a weird quirk of human nature; most people tend to wander aimlessly without a well-defined goal. To be successful, you must have more than just a general idea of what you want to do. You need to have a specific target in mind and a plan to get you there.

This, in a nutshell, defines the importance of financial goals. After all, how will you know when you’ve made it if you have no idea of what making it looks like?

Planning For Retirement

Here’s an indisputable fact; the sooner you begin setting cash aside for your retirement, the better off you will be—as long as you continue doing so consistently. If you’re 25 years old and decide to get a used car for $150 a month, rather than buying a new one at $400 a month—and keep on doing so for 50 years—you’ll have two million dollars by the time you’re 75.

And, you’ll still have had a ride everywhere you wanted to go!

Creating an Emergency Fund

Planning for the unforeseen could well keep you out of debt in the event of a job loss, severe illness, or some other financial calamity. Most people have to default to credit cards in these instances because they don’t plan ahead.

Meanwhile, having an emergency fund of three months worth of expenses could be the difference between surviving an untoward incident, or staring into the abyss of bankruptcy protection.

Paying Off Debt

Given most American households are carrying some form of unsecured debt; whether it’s credit cards, charge cards or student loans, developing a plan to pay off yours is a key short-term financial goal. After all carrying debt from month to month incurs interest charges, which is money you could be using to secure your future. Further, if left unchecked, debt can easily spiral out of control and consume all of what should be your disposable income.

The good news is debt settlement companies such as Freedom Debt Relief can help you negotiate a debt reduction with your creditors on most unsecured loans, credit cards, and medical debt. Still, it’s better to have use smart planning than to fall in debt in the first place. So analyze your current position to see if you can turn the corner before finding yourself deep in debt.

Shifting Priorities

Priorities change as you age. A 25 year-old single person will have one set of financial concerns, while a 35 year-old married person will have completely different money needs. Whether its putting children through college, caring for aging parents or buying a home, all can be accomplished more readily when you have a plan in place for tackling them. Sitting back and letting things happen is a good way to find yourself wholly unprepared when (not if) a need arises.

Who Can Predict the Future?

Who knows where you will be or what needs you’ll have 10 years from now? The only thing you can know with any certainty is you will need money to accomplish whatever it is you want to do. Yes, you can—and should—make plans for the way you’d like your life to be. However, life is full of twists and turns. What seems definite today might only be a maybe tomorrow.

With all of the above in mind, the importance of financial goals becomes abundantly clear. The only way to have a shot at being ready for the unknown is to plan ahead. Establishing financial goals to deal with the inevitabilities will make you much more likely to be prepared for whatever else life brings your way.