PrevNext

Establish Financial Goals

What Are Financial Goals?

Goals bring order to chaos as they focus the mind on something tangible. Believe it or not all animals set goals - find shelter, find food, and so on. This is instinctual which is why if we are not aware of this instinct and/or don't follow our instinct it makes us unhappy. Certainly humans lead more complex lives than our instincts can seem to provide for, so to compete in life and survive we must learn information and skills over and above our instincts. Financial goals provide focus and clarity around money management.

Financial Goals Must Be Clearly Defined and Quantifiable

Goals must be clear and quantifiable. Quantifying simply means adding a measurable value to an objective. For example 'many apples' is not quantified, but '6 apples' is. Quantify not only how much you want but also by when. 'I want $5,000 cash in my bank account within 6 months' is an accurate goal, and is very specific. When 6 months has passed either you will have more than $5,000 or less than $5,000 - goal reached or not reached.

Setting Goals Creates Outcomes

A goal allows a plan to be formed. The plan itemises steps to achieve the goal. As each step is reached, there is a great sense of success which instills self-confidence. Setting unrealistic goals mostly leads to the inability to meet them, and thus lowers your self-confidence. Lower self-confidence leads to self-doubt and than turns into non-action, that is, nothing changes in your life. So please start off with achieveable goals and a plan to suit - then work your way up comfortably.

A Goal is Nothing Without a Plan

I used to have a goal that I would be a millionaire by the time I was 30, but I had no idea how I was going to do it (no plan). Not only that I had no real idea what it meant to be a millionaire, the definition was lost on me. Obviously I missed that goal. I now have a plan and I'm quietly achieving it step by step.