Athletes set goals to win their competitions. Sales people set goals to close sales. Politicians set goals to get votes. Students (hopefully) set goals to get good grades. CEO’s set goals to increase revenue. What personal financial goals have you set?
Constantly setting goals is a mark of successful people. That sounds like a broad statement, but it usually is true. Humans need something to strive for, something upon which to focus their energies and efforts. Unsuccessful people allow life to happen to them by accident. They have no plan for the future and then wonder why successful people “get all the breaks.”
I’m not going to let myself fall into this trap. I plan to follow these 12 steps for every goal I set for myself. One of my financial goals is to perform an analysis on my personal finances and then set a livable budget. I’ll walk through the universal goal setting steps to demonstrate.
1. You must have a desire or need to accomplish your goal. It sounds like a “duh” moment, but it really is the first step. I sincerely want to perform this analysis and get back on a budget.
2. You must believe you can achieve your goal. Your goals must be believable, achievable, and realistic. Set a goal that causes you to stretch, but set one that is reasonable. I believe that setting aside time to analyze my finances and getting on budget is a reachable goal.
3. Write your goal down on paper. Experts agree that the act of writing down your goals is a key component to achieving them. I will write down mine and perform my analysis on paper. I will also write the budget on paper, but will move it to Excel soon afterwards.
4. Determine how you will benefit by achieving your goal. The more benefits you can list, the better. A long list will position your goal more forcefully in your mind.
5. Analyze your current position in relation to your goal. This requires a little maturity. To get somewhere, you have to have a starting point. Where are you now financially? By performing a financial analysis I will have my starting point established.
6. Set a deadline to accomplish your goal. A goal without a deadline is a wish. It holds no importance in your mind. My deadline to do my financial analysis is February 3rd. Why so far away? See point #9.
7. Identify what obstacles are in your way. Also write these down. Many times, after writing down what obstacles you think you’ll face, you realize how petty and insignificant these obstacles are in light of your goals. My obstacles for the financial analysis include the good old “time” excuse and the inevitable “I can’t find all the paperwork” excuse. Obstacles for stetting and staying on budget include all the “what ifs” and just “life.” I need to better address what I consider my obstacles.
8. Identify what knowledge you’ll need to accomplish your goal. There is almost always something you’ll need to learn to accomplish a goal. In my case, I need to fine tune both my financial analysis and budgeting knowledge.
9. Identify the people or organizations you’ll need to partner with. Your goal probably will require the help of another person or group of people so make sure you consider this in your goal setting process. I will require the help of my wonderful wife because without her help and participation, everything will fall apart.
10. Make your plan. Assemble everything you’ve written and write out your plan to reach your goal. Put everything on paper. Always try to think on paper if possible. I’ll write everything down, but will transfer it to Microsoft Word or Excel.
11. Visualize what accomplishing this goal will look like in your life. Think about all the positive changes your goal will bring and keep that image in your mind. Keep your goal in the forefront of your mind by writing it every day and reviewing it constantly. I visualize paying off debts and attacking the mortgage. I cannot wait to never have a mortgage again!
12. Take action every day. I need to . Never let a day go by without working on your goal. Never give up. You’ll experience some setbacks to be sure, but you must persist. John Quincy Adams said “Patience and perseverance have a magical effect before which difficulties disappear and obstacles vanish.”
Don’t drift through life! Become a goal setting machine. Rarely does anything good happen until someone sets a goal, so set your goals according to these steps and you’ll have a proven pattern that works.
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[tags]life, money, personal finance, goals[/tags]
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