How is a financial goal defined?

A financial goal is defined as a specific objective to gain financial security or wealth. This means that the goal is clear and measurable, allowing individuals to set their sights on achieving something concrete, whether it be saving a certain amount of money, paying off debt, or preparing for a big purchase.

Setting specific financial goals helps individuals to focus their efforts and make informed financial decisions. For example, instead of saying "I want to save money," a specific goal would be "I want to save $5,000 for a down payment on a house within two years." This specificity provides a clear target and timeline, making it much easier to devise a plan and track progress.

Other options describe elements that are either too vague, such as a "general plan for retirement," or unrelated to financial planning, like "unplanned expenses." These do not encapsulate the precision and intentionality that is essential in defining a financial goal. A financial goal always aims towards measurable achievements in the realm of personal finance, linking directly to security or wealth accumulation.