The Importance of Mid-Term Goals

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What are mid-term goals and why is it so important to define them? We all have short-term and long-term goals, but many of us neglect the crucial mid-term goals. We need to set mid-term goals because focusing on those long-term goals can be extremely difficult. It’s hard to stay motivated when the payoff is so far off. Here is how I define these different types of goals.

Short-term goals are things you can accomplish in less than one year. These are the type of goals I set every New Year. Short-term goals should be achievable, and measurable. You should make progress on them every month.

Long-term goals are things that take 10+ years to accomplish and we won’t see much progress from year to year. These are things like saving for retirement or being completely debt free. We don’t make quick progress on these goals and it’s easy to get discouraged. For example, it’s practically impossible to focus on saving for retirement when you’re 25. You have so much time left until retirement and you won’t see the result for decades. Also, long-term goals usually are moving targets. We don’t know how much money we need for retirement until we are older. That’s why we need mid-term goals to bridge the gap between short-term and long-term goals.

Mid-term goals are things that you can accomplish in 3 to 5 years. Everyone has these mid-term goals but most of us don’t keep track of them. That’s a mistake because goals are forgotten if we don’t pay attention to them. Here are some examples of mid-term goals at various stages of life.

Graduate from college
Pay off the auto loan
Buy a house
Have a baby
Become a VP in your organization
Make it in the music/acting/art scene
Become a millionaire or accumulate whatever amount fits your current financial situation.

You should be able to make noticeable progress on these goals every few months. That makes them much easier to track than long-term goals. Also, your mid-term goals should align with your long-term goals. Every time you accomplish a mid-term goal, you should be one step closer to your long-term goals. It’s an occasion to celebrate.

*Originally written in 2016. Updated 2023.

Set Big Mid-term Goals

Personally, I like to set just one big mid-term goal so I can focus on it. When I started Retire by 40 in 2010, my big mid-term goal was to retire from working full-time in 5 years. The stars aligned and I was able to accomplish that earlier than I expected. It’s important to note that we had been saving and investing for a long time before I made that mid-term goal. We were almost there and just needed the final push to get over the finish line. If I just started saving for retirement in 2010, then it would have taken much longer to retire early.

Our next big mid-term goal is for Mrs. RB40 to retire by the end of 2022. Unfortunately, this didn’t work out. Mrs. RB40 took a sabbatical, but she went back to work. She still likes her job and it makes her feel good about herself. She pushed out her target retirement date to 2028.

Here are some other goals we have.

Take a year off to travel. We wanted to take a year off to travel in 2021, but it didn’t work out. Mrs. RB40 was still working and the pandemic made travel much harder. We traveled for 3 months in 2022 and we had a lot of fun. Once Mrs. RB40 retires, we’ll take a year off to travel around SE Asia.
Simplify our real estate holding. We made a lot of progress since I wrote this post in 2016. We sold our condo and moved into our duplex. Currently, we have one rental condo left. Once our tenant moves out, we’ll put it on the market. When Mrs. RB40 retires, we’ll sell our duplex and move. Being a landlord is a great way to build wealth, but I want to travel more.
RB40Jr goes to UCSB. Our son is pretty smart, but he has a hard time regulating his emotion. Hopefully, he’ll be able to control himself more as he gets older. We’ll try our best to help him get into our alma mater. If he can’t get in, he can go to Portland State for a couple of years and then transfer. Actually, any good public university would be okay with me.
Refocus blog. It’s hard to continue blogging about the same subject for many years. You get bored and run out of things to say. Somehow, I’m still at it after 13 years. But I probably need to refocus my effort in the next few years. Maybe I can write more about travel and make more YouTube video clips.

What do you think about my mid-term goal? These goals are very motivating for us and we are working hard to accomplish them.

We were exhausted after traveling for 3 months in 2022. We’ll need to slow the pace down and stay in one location longer. By 2029, we should be able to afford more luxurious apartments and flights. Travel can still be fun when you’re older. We just need to slow down a bit.

To wrap it up, I think mid-term goals are very important. They are big goals that can change your life. That’s why everyone should set some big mid-term goals and work hard on them.

Do you set mid-term goals? Can you share some of your mid-term goals with us?

Image by Adam Kubalica

Joe started Retire by 40 in 2010 to figure out how to retire early. After 16 years of investing and saving, he achieved financial independence and retired at 38.

Passive income is the key to early retirement. This year, Joe is investing in commercial real estate with CrowdStreet. They have many projects across the USA so check them out!

Joe also highly recommends Personal Capital for DIY investors. They have many useful tools that will help you reach financial independence.