How to Set and Achieve Your Financial Goals

How to Set and Achieve Your Financial Goals November 28, 2012

Would you like to know with greater certainty that you’ll have enough money to retire? Do you know how big of a nest egg you want when that time comes?

I ask these questions for this reason: clarity is one of the most important concepts in personal productivity and achieving goals – financial or otherwise.

Over the years, I’ve learned that two huge reasons why some people get more done is because they’re

  1. crystal clear about their goals, and
  2. they don’t deviate from them.

In fact, three major reasons for procrastination and lack of motivation are

  1. vagueness and confusion about what you’re trying to do,
  2. what order you should do it in, and
  3. the reason why you’re doing it.

You must avoid this condition with all your strength by seeking greater clarity in your major goals.

The Power of Goals

It’s been said that only about 3 percent of adults have clear, written goals. Yet it’s these people who accomplish five to ten times as much as people of better education and ability but who, for whatever reason, have never taken the time to write out their goals.

Here’s a powerful formula you can use to set and achieve goals for the rest of your life. Although I’m going to apply it to the goal of saving enough money to retire, these six simple steps will work for any goal that you set.

Decide Exactly What You Want

Sit down with your family and have a discussion until you’re crystal clear about your goals, what’s expected of you, and in what order. It’s amazing how many people live day-after-day without having had this discussion with their family.

For instance, do you want to have $1 million dollars saved up by the time you retire? If so, make that decision.

Write It Down

Think in your head first, but then make sure to write it down on paper. When you write down a goal, you crystallize it and give it tangible form. You create something that you can see and touch.

On the other hand, a goal that’s not written tends to merely stay as a wish. It has no energy behind it. These unwritten goals lead to confusion, vagueness, and misdirection.

So if you want $1 million by the time you retire, write this down this simple statement: I will have $1 million by the time I retire.

Set a Deadline For Your Goal

A goal without a deadline has no urgency. Without a definite deadline accompanied by the acceptance of your specific responsibilities to bring the goal to completion, you’ll naturally procrastinate and get very little done.

For instance, if you’re 35 years old, and you want to retire at age 67, then you’ve given yourself a 32-year deadline to reach your goal.

Make a List of Everything You Need to Do to Achieve Your Goal

As you think of new activities, add them to your list. A list gives you a visual picture of your larger objective. This dramatically increases the chances that you’ll achieve your goal on time.

To save $1 million dollars by the time you retire, do you need to invest in your company’s 401k? How about building your wealth through a Roth IRA? Do you need to know what the contribution limits are?

Investing in the stock market over the long term is one of the best ways to grow your money.

Organize Your List Into a Plan

Organize your list by priority and sequence. Decide what you need to do first, and what you can do later. Better yet, lay out your plan visually in the form of a series of boxes with arrows showing the relationship of each task to the others.

With a written goal and an organized plan of action, you’ll be far more effective than people who are just carrying around their goals in their minds.

Will you contribute to your retirement accounts monthly? Or if you get paid bi-weekly, will you also invest bi-weekly? How about setting up automatic investing to these accounts directly from your paycheck, so you never miss a contribution and stay on target to reach your goal?

Take Action on Your Plan Immediately

Do something now. An average plan persistently executed is way better than a brilliant plan in which nothing is done. For you to achieve your goal, execution is everything.

If you haven’t setup your 401k, talk to your HR representative to find out what you need to do. If you haven’t setup your Roth IRA, open up an account with a discount broker.

What goals are you trying to achieve?

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  • Rita@PaydayLoansAt

    It’s extremely important to set right financial goals, especially today when the economy is tough enough. And it’s necessary to remember that long-term goals consist of short-term ones, so make up a realistic plan. Every day has a meaning, so use every chance to get wealthier and more successful. Of course it can be difficult to plan everything, but remember that we all learn from our own mistakes. In case you try to reach one or another goal but do not see any results than try to change a strategy – for example get a part-time job and try to save more money.

  • This is something really valuable.Thanks and keep sharing.