We often start the year with obligations to identify a behavior within ourselves that needs improvement and set well intentioned goals to take action. Unfortunately, it's just around this time of the year that our motivation begins to fade.
Perhaps you set a goal to
save more for retirement,
start your child's college fund, or
finally schedule that appointment with a financial coach/advisor
the key to successfully following through with your financial goals is to start with two (2) questions - WHAT? and WHY?
One of the major reason New Year's Resolutions and Goals don't stick is because they lack a clear purpose. In order to get clarity on your financial goal, first ask yourself -
"WHAT Is My True Purpose for Money?
Money is nothing more than a tool used to acquire things you believe are important to you. If you don't know WHAT is important to you, you will eventually find yourself misusing your tool and left in a dysfunctional relationship with money.
You can begin to get an understanding of what is important to you by identifying your Values. Here's a simple method:
Create a list of all the things that are important to you (i.e., Family, Integrity, Helping Others, Freedom, etc.,).
Now, narrow your list down to the ten (10) things that resonate with you the most.
Finally, select the five (5) most important values. These are your Core Values.
From there, you will begin to discover how your values give meaning to your goals and how your goals give meaning to your money.
The second thing you need to ask yourself is "WHY Is This Goal Important to Me and My Values?"
Let's say your goal is
maximum funding your annual IRA contributions or
opening a life insurance policy,
you need to identify WHY it is important for you to accomplish this goal. This is an important question, and answers like, "because that's what I was advised to do" isn't going to fuel your desire to achieve your goals.
The key is to identify reasons that have value for you. For example,
"I will contribute more towards my Retirement because Security is one of my values and I want to make sure that when I want to stop working, I can actually afford to stop working" or
"I will apply for Life Insurance because Family and Education are two of my values and I want my kids to know that if anything happens to me, they will still have the means to attend college.
These are examples of WHYs that keep you motivated and on track to achieve your financial goals, along with your fitness, faith and family goals. Without them, distractions and life will consistently get in the way.
Remember this, your mind needs to attach value to your goals in order to make them worthy of pursuing and your WHAT and WHYs are the keys to making that happening.