Is it important to set financial goals?
Is the exercise of writing down your family’s financial mission the key to unlocking a “better way”? Will setting objectives and charting progress help you navigate the complexities and heightened emotions of money in a “COVID-19 world”?
Good questions! Goal setting isn’t the absolute panacea for financial bliss, but the team at New Wealth Project believes that documenting and reviewing your objectives is a foundational element of your financial plan and by using them as a guide and benchmark, families can accelerate success and avoid the mistakes of those less prepared. So, what are the ways in which setting, reviewing, and revising goals can be valuable, you ask? Let’s consider 3 reasons…
1. Structure and Purpose
By defining and documenting your personal mission, you are setting in motion a new mindset that is focused on what you can control, and what matters. You can now zero-in on the “levers” that can be pulled, when necessary, to move you closer to your objectives. Consider this: You define your investment goal of saving enough for retirement, which is likely 20+ years from now. Faced with the current “bear” market, and your investments losing value, you reflect on your 20 year goal and begin to pull the levers that align with this objective; you add to your retirement accounts, you rebalance your portfolio (in effect buying “low”), you manage cash flow and prioritize discretionary expenses. The perspective offered by reviewing the goal allows your actions to align with your mission, and your focus to “narrow” onto what really matters to you and your family.
2. Energy and Excitement
Success breeds success, and being able to meet or exceed your goals creates the energy to aim even higher. This constant achievement and growth builds in people a sense of accomplishment and optimism that drives them to “do and be” more. Borrowing from Dan Sullivan of Strategic Coach, our team at New Wealth Project uses a process called “Positive Focus”; a methodology of consistently reviewing all successes, be them large or small, to continuously feed our confidence and to deliver the energy necessary to forge ahead, both personally and professionally. With so much fear and uncertainty surrounding our lives as a result of the Covid-19 pandemic, it is so important to find time to reflect on the small successes that you and your family are having every day to “top-off” your store of positive energy. The shift in mindset away from being a victim of circumstance towards being the driver of your family’s financial success is an empowering process. Good results will likely follow!
3. Connection and Shared Vision
Finances and money “issues” can be a source of serious conflict in many households. The nexus for this discord is often found in partners who are not on the same page, and who have not been overt in sharing their goals and priorities with one another. Add-in the uncertainty we face every day now as result of the pandemic, and you have a not-so-pleasant recipe. One of the most exciting elements of our Personal Mission Builder module at New Wealth Project is when spouses and partners begin to share their thoughts, feelings, and opinions. We create a safe space for folks to have this discussion, and we witness cohesion taking shape and this shared vision deepening the connection among participants. It becomes clear that the partners are now “in it” for each other and this energy motivates the couple in a unified way like never before.
To begin your journey, consider answering these questions. Write down your answers and you will be off to a great start.
- What do I want my life to look like in 3 years?
- Personally, Professionally, Spiritually, etc.
- What are the most exciting financial opportunities that I want to take advantage of?
- Savings goals, college accounts for kids, emergency fund, etc.
- What are the most pressing financial dangers that I want to eliminate?
- Pay down debt, improve my insurance plan, etc.
Having money goals matters and your answers will reveal your Personal Mission while making clear the action steps necessary to begin your exciting journey.