As we say goodbye to 2016 and look forward to 2017 the start of a new year allows us to stop and contemplate what we hope to achieve in the upcoming year. This includes financial goals.
The first step is to “dare to dream”. Dreaming allows us to identify what it is in life that we actually want. Whatever your dream is you need to take the next step to make it a reality. You need to turn it in to a goal.
The best way to set goals is to write them down. A long term study carried out in the US asked a class of university students who had written specific life goals down. While many of the class had goals only about 5% of the class actually had them written down. 5 years later the follow up study was carried out and of those 5% that had written down their life goals – 100% of them had achieved them – within 5 years! The statistics amongst the remaining members showed that less than 5% had achieved their goals.
Set a realistic time frame to achieve this goal. There is no point in saying “I will pay off my $200,000 mortgage in 2 years” when your income is only $30,000 per annum. Putting unrealistic time frames only sets you up for failure. By all means make it challenging but make it achievable.
Break your goal down to bite size chunks. Using the above example you may decide you want to pay off your $200,000 mortgage in 5 years. Break this down to an annual figure ie $40,000 per annum. Or even a monthly one of $3,333 per month.
Work out the “how to”. What do you need to do in order to make this happen? With the above example you may decide that you will simply increase your loan repayments to $3,333 which is ok if your income can accommodate that jump. BUT you could increase your loan repayments to say $2,000 month ie $24,000 per annum and then try and find a way to pay a further $16,000 off per annum. This could include – increasing the hours at work, taking on another job, finding an alternative income stream – eg turning a hobby in to an income generating business etc etc. This is where the imagination can really accelerate you to your goals.
Each of us have unique obstacles to overcome which need to be identified and addressed. But each of us also has unique opportunities. Focus on your opportunities as they can really provide the greatest chance of accelerating you to achieve your goals.
As with any plan you need to regularly review that you are on track and make changes as your own situation changes.
Goal setting is about turning your dreams in to a reality. You can take control and make them achievable by setting these goals or you can simply sit back and whinge how your numbers didn’t come in with Lotto this week.
