- Setting goals too low can be just as debilitating as setting goals too high.
- Don’t ever stop asking yourself, “How can I do better?”
- Your goals will and should change over time.
- Your financial advisor can be a great sounding board for setting realistic goals and devising strategies to achieve them.
Goals are an important dictator of human behavior. Volumes have been written about the danger of setting goals too high to achieve or too low to have an impact. But what about those triumphant times when you achieve your properly set goals? We all know about the dangers of resting on your laurels. How do you continue to keep setting the bar high, without being unrealistic and ultimately disappointed by your efforts?
The Power of Incremental Improvement
Let’s say your goal was to take two strokes off your golf game this season and you achieved it. Would that stop you from working on your new and improved golf game? Of course not. Suppose your goal was to get a work promotion and you earned it, would that be the pinnacle of your career? Probably not. Would you stop working hard once you achieved a business revenue milestone? Heck no. The same theory applies to building a business, completing a marathon, or finally executing a handstand in yoga class. You continue to set new goals to improve yourself and your situation.
Setting Your Personal Financial Bar Higher
When it comes to your personal finances, goal setting is no different. You need to set realistic, attainable goals, with a strategy to reach them. You also must adjust your goals on a regular basis as you get closer to achieving them. Unfortunately, that often conflicts with human nature to be complacent.
Take some time to document your current financial situation, take a deep breath, and determine what your personal financial and life goals should be. For example, if you have questions on how to do a handstand, work with an experienced yoga instructor to develop a realistic plan to master the skill. If you want to retire earlier, work with an experienced financial advisor that will help you develop a plan to reach your target.
If you can stash away enough to meet your current savings goals, with a healthy amount of excess in reserve, congratulations! You’re way ahead of most Americans. Take the opportunity to realign your savings goals and look for ways to make an unrealistic milestone an attainable one – like retiring early, paying off your mortgage sooner, or finding out if you can afford to work less. Your financial advisor can be a great resource to help you define these objectives. Regardless of the specifics, be sure you can say: “I know where I am and I am on track to reach my goals” – this is true for all intentions, not just money related.
If you or someone close to you has questions about their financial goals, please don’t hesitate to contact us. We offer complimentary initial consultations through our Second Opinion offering.
James Nevers,CFP® is a Senior Advisor at Soundmark Wealth Management, LLC. James works closely with physicians, business owners, directors and executives at Amazon, Microsoft, and Boeing, and other successful individuals to help them define their financial goals and implement an ongoing financial planning process.