Editor's note: This is a special excerpt from TheStreet.com Ratings' Ultimate Guided Tour of Stock Investing. Other Beginner's Guides cover stock basics , market indices and diversification .

You're on a Mission -- Yours!

Have you ever read the mission statement of a company or organization you admire? Over and over again, you'll notice certain qualities, but there are always the same few that keep topping the list. We call them the three "Ds":
  • a dream
  • determination
  • discipline

These are the same qualities that you, the beginning investor, can use to be successful, too. Committing words to paper has a funny way of turning thoughts into action. It doesn't matter whether your mission statement is one line or one paragraph; what does matter is how serious, and how prepared, you are to reach your goals. Writing a personal mission statement helps you keep going in the right direction.

Your Personal Financial Mission Statement

Mission statements keep organizations focused so they achieve their goals.

People, including you, need mission statements, too. Why? They help identify what's important and what you value most. That way, you'll focus on what matters most to you so that you can accomplish the things you really want. This is especially true for financial goals. After all, if you don't know where you want to go, it's unlikely that you'll ever get there.

To create your mission statement, spend some time thinking about your current situation. Now, imagine where you would like to be -- financially -- next year, in five years, and in twenty (or more) years. Be specific and realistic!

To help you along this journey, here are some ideas for you to consider:

  • I would like to retire in ___ years.
  • I would like to retire by the age of ___.
  • I would like to retire within ___ years with a portfolio valued at $_______.

Rainy day savings: I would like to have three to six months' worth of expenses, approximately $_______, saved within ___ weeks/months.

Education or business opportunity:
  • I would like to save for a child's college education, which will cost $_______ and will be needed by _______.
  • I would like to have money to enhance my education, whether that's graduate school, law school or another specialized field of study. I will need $_______ within ___ months/years to pursue this dream.
  • My dream is to open my own business , so I will need $_______ in capital by _______.
  • Are there other opportunities that you would like to plan for?
  • At what cost?

Home or car purchase:
  • I would like to save for a new/larger house. I would like to have a $_________ down payment saved by ______.
  • I would like to save for a second home located in ___________ and have a $________ down payment by ______.
  • I would like to buy a new car within ____ months, which will cost $___________.

  • My dream vacation to ___________________ in ____ months/years will cost $______.
  • My family enjoys the water, so I would like to upgrade our boat within _____ months/years to a ___________________, costing $______.
  • What other special interests or activities do you want to include in your plan? What is the cost?

Debt reduction:
  • I would like to pay down my mortgage ___ years sooner than it matures.
  • I would like to reduce personal or credit card debt of $_______ within _____ months/years.

Quantify your financial goals with the help of TheStreet.com Calculators.

To achieve your dreams, it's very important that you write your goals down so that you can refer to them often. Then, sort them according to a time frame -- short-term vs. long-term, because you will need to save for them differently. Finally, post your goals on the bathroom mirror or refrigerator, so you will have a constant reminder to stay focused!

Kathleen's Dreams

Kathleen, a 35-year-old working mother of two, thought about where she wanted to go and mapped out her financial goals by writing a mission statement that would keep her on the right path.

Kathleen's mission statement: "I'm tired of worrying about money. In the next two years, I want to have an emergency fund with six months of savings, in case my car -- or job! -- collapses, and get rid of the credit card balance I've been carrying since college. In 10 and 15 years, I want to be able to send Harry, now 8, and Amanda, 3, to college. My ex is not in a position to contribute to a college fund, so I will be responsible for all education expenses. I want to think about my 'Golden Years' without feeling scared that I won't have enough money to live on. With 30+ years to save, I want to learn how to invest in the stock market, so I'll have enough money to see my dreams come true."

Kathleen has big dreams she wants to fund. By mapping out her goals, she has come to realize something very exciting.

In her case, she has the time to invest in the stock market as a way to reach her goals.

Everyone's situation is different. For example, different short- and long-term goals (a new car next year compared with a child's college education in seven years to retirement in two decades) need different investing vehicles to achieve different results, or returns. If you're looking at a goal five or more years on the horizon, then investing in the stock market is a smart decision because, despite the risks that can and will occur, you have the potential to earn more money, because you will have the time you need to ride out the market's ups and downs.

But you're not ready to invest your first dollar until you're much more comfortable with risk and know what you can do to manage it.

Next: Discovering Your "Risk Zone." To get a head start, click here .
This article was written by a staff member of TheStreet.com Ratings.

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