Financial Goals oh Financial Goals

Three types of financial goals:

  • Essential Goal. This is a goal that you need to achieve with 100% probability or a probability of 1. Basically, you CANNOT have a shortfall.
  • Important Goal. This is a goal that is less important than essential. When you plan, this is a goal that you can accept that there is less than 1 probability that you are able to fulfil the goal. This means that in some poor economic sequence, the amount might fall short and you accept that.
  • Aspirational Goal. These are goals where the probability of being fulfilled is low to very low. With your current resources, it is likely you cannot fulfil them.

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The Right Portfolio Strategies for Essential, Important and Aspirational Financial Goals. | Investment Moats