Set a goal and take control over your finances
It can be hard to grab a hold and take control over your finances without an explicit goal. Even though you might not have a goal, it is of course still possible for you to save money, but when does the saving then end? You risk saving all your life and never reaping the fruits of your efforts. It is, however, a minority that manages they finances well without a goal. The majority will often let their decisions be driven by impulse and the heat of the moment instead of what is rational.
Define your goal
You can define your goal in many ways but do yourself the favour of considering carefully where you see yourself in 5, 10 or 20 years. There is no right or wrong. Perhaps your would like to retire at the age of 40, maybe you want to travel the world full time, only work 20 hours a week, live in a nice house and drive an amazing car, spend half the year on voluntary work – you get the point.
It is only you that can define your goal, but it is essential to do it explicitly to be able to plan and develop a strategy for reaching it. Once the goal is set, you can plan your life and run the numbers on how and when you will reach it.
This approach is not only valid for your overall goal, but also shorter-term goals throughout your life. For instance, you might be saving for an apartment or for a dream vacation. You will be able to plan the road to accomplishing these short-term goals much easier after you explicitly defined what is needed.
Split your goal into sub-goals
Your main goal will often be complex and depend on several factors. Therefore, it can be useful to split it into smaller sub-goals that are easier to manage and comprehend. They will make it easier for you to plan your road to success and help pave the way to the main goal.
If you have trouble with sticking to the plan you have made, then it might be helpful to write it down and share it with friends and family. This will increase your commitment to the goal and others will be able to support you in making the right choices.
- Define your goal for where you see yourself in the future
- Divide your goal into sub-goals that are easier to manage
- Make your goals explicit and define what they require
- Develop a plan for how and when you will reach your goal
Need advice or counsel?
I offer our members one hour of free independent consultation relating to their personal finances. We can discuss everything from general planning to detailed investment strategies to real estate financing. Become a member here and contact me via our contact form here and make sure to add “Counsel” in the subject line, then we will find a suitable time together.