If you want to become rich, goal setting is essential. Setting goals guide your focus. How will you get to your destination, if you don’t know where you’re going? What gets measured gets managed. Measuring makes you motivated, for it’s in our human nature to strive to improve the score. Goal setting is a blue print to building your financial nest eggs.
First Step: Feel It
Setting your goals and writing them down is an exercise and a process. Although this is important; just doing this will not make you achieve your goals. Many set goals but do not achieve them. Frequently, it’s because it’s not inspiring or connects them to a purpose. In order to set goals and achieve them, you must feel it.
Go back to discovering why you want to be rich (So You Want To Be Rich). Tell yourself a story and create a storyboard. If you can’t feel your purpose or you’re unsure of why or how much you want to be rich, you may end up being one of those people who don’t achieve your goals.
While growing up, my family moved from one apartment to the next seeking somewhere cheaper to live. As I was building my nest eggs, I thought of all the awful places we lived to never go back there again. I felt my goal deep in my soul.
Can you feel your goal?
Second Step: Visualize It
In the Million Dollar Habits, Brian Tracy, states you have to absolutely believe you can achieve your goal. This means, you have to believe not just with your mind but feel it deep in your heart, that you can achieve your goal. It is a self-fulfilling prophecy, what you believe will manifest itself in reality. Visualization is the formation of a mental image of something. Scientists claim visualization works because when we visualize an act, the brain generates an impulse that tells our neurons to “perform” the movement.
Visualization will decrease your anxiety about doing the work to achieve your goals and give you the confidence to act.
Third Step: Write It Down
Napoleon Hill, spent a quarter of a decade interviewing the 500 richest men in America, including Henry Ford, Teddy Roosevelt, Andrew Carnegie, Alexander Graham Bell, Thomas Edison, John D Rockefeller, Charles Schwab, and many more. He found that all these successful people all set goals without exception. Here’s a summary of his advice on setting a financial goal (Think and Grow Rich link):
- Determine exactly how much you want
- Determine exactly what you’re willing to offer for the money you want
- Establish the exact date for when you plan to have the amount of money you want
- Establish a definite plan for achieving what you want
- Start now, even if you don’t feel you’re completely ready
- Write out a clear statement of how much money you want, what you’re going to do to acquire it, the date you’ll acquire it by, and your specific plan for reaching your goal
- Read your goal out loud twice a day, while visualizing yourself executing your plan and the money in your possession
SMART (specific, measurable, achievable, relevant, time bound) goals are great for beginners. Use this to achieve initial goals and minor stones when getting started with goal setting. Once you get the confidence after the proven theory, try setting a different goal- a bodacious dream goal.
Here is an example of a SMART financial goal:
I will save $2,000 in cash for my emergency fund in one year (place date here) by eliminating my cable and gym membership so that I can have a peach of mind.
Once you achieve the above, try the bodacious dream goal. This goal at the beginning, seems so out of reach that it doesn’t seem possible. How do you think people complete 100 miles ultra marathon? By chipping away at it, one block at a time.
Here is an example of a bodacious goal:
I will generate $1million in my retirement fund by age 60 so that I can travel around the world.
Since goals will help you achieve what you want, why not reach for the stars?
I am talking specifically about financial goals here. But it’s important to set life goals as well. If you’re successful financially but not personally, you’ll end up unbalanced and unhappy. I reassess my goals at least once a year on my birthday but you can do it on the first of the year or whatever suits you.
The important thing is that you think deeply about your goals and write them down.
Once you write out your life goals, then you can break the big picture down into smaller and more specific goals.
Fourth Step: Create a To Do List
After you’ve written down your goals, you have to write down the individual steps to get there. Your goal for saving $2,000 in one year may look like this:
- Open a credit union account at work
- Set up an automatic deduction of $84 per pay check (if paid bi-weekly)
- Call cable and gym and cancel membership
- Monitor progress
Cross off the list as you achieve them. One of the habits, which millionaires have in common, is having a To Do list.
Fifth Step: Read The Goals Out Loud
Now that you have written down your goals, place it in a place where you will see it every day. You can write it on a Post-It and post it on the mirror. You’ll see and read it the first thing and last thing when you brush your teeth. Hopefully, you brush your teeth at least twice a day.
Over the years, my goals have become specific but long as I added to them. I’ve added 1 year, 5 year, 10 year and life goals. My goals no longer fit into a Post-It so I have a Read Daily memo on my computer that I read each day. The important thing is to get into a habit of reading your goals every day.
Setting goals, feeling it, visualizing it, writing it, reading it, and acting on it will enable you to achieve your financial goals.
“Begin with the end in mind.” -Stephen Covey