3 Key Ingredients to Successful Financial Goal Setting
February 7, 2020
We know that setting financial goals is important, we have all learnt how to create meaningful and achievable goals. But before you even get to that point, I invite you to consider these 3 things and how they impact your goal setting and ultimate success:
Your Values and Mission.
So often in life we set goals because we think they are things we should do without checking in on whether they align with our unique values and mission. Sure having the goal to pay off your credit card is an admirable one but if there are other financial goals that align more for you then you may find you struggle to reach this goal and keep getting distracted. Whilst there are other factors to our prioritising of goals when we align seamlessly with our goals, we can reach them far easier. Ask yourself these questions:
What are my values and mission?
Have I prioritised my goals based on those that align most closely?
Are there goals that are leaving gaps in my commitment to my values and mission?
Review the past.
The last financial year gives us a great overview on what we were able to achieve previously and is therefore a wonderful tool. Of course, I recommend reviewing your financials regularly, monthly as minimum. However, getting a good overview of the previous financial year can give you good insight into your goal reaching capabilities and direction. Things to consider are:
Did my income decrease or increase?
Why has my income changed? Was this planned?
Are there particular areas that experienced more growth than others?
What did my expenses look like and why?
Long term goals.
There is such variety in the types of goals you can set, and time is one of the biggest determinators. The goals that you can set to complete today are very different to the goals you can achieve in a year. However, all the goals we set should have some consistency. For example, if you want to save $5000 by this time next year but your short-term goals include spending money on up leveling your business knowledge, you may find that saving goal challenging.
Think about:
If my short-term goals are successful what impact does that have on my long-term goals?
What do I need to do today, this week, this month in order to achieve my long-term goals?
Go beyond the year and look at what you are reaching for in the next 5 – 10 years.
Financial goals are at the crux of all good planning, after all, it is difficult to achieve many things without the budget behind it. I believe everyone should have sustainable financial goals in place and a budget underpinning it.
