Many people have a clear sense of where they want to be financially. Perhaps you would like to be able to pay off debt, live off of one income, retire early, quit your day job, or travel for a year. But how do you transition from financial goals to actually enjoying that reality?
Tips for Accomplishing a Financial Goal
You can do so many things and accomplish nothing, right? Have you ever spent a day in the office where you devoted some time to five different projects and felt like you did nothing? Compare that to the feeling when you choose one task and complete that task by the end of the day.
In order for you to accomplish your financial goals, you need to move from goals to a specific financial focus point. This is the place where all of your available dollars will be directed. For the couple trying to work for one spouse to stay home, they should focus on building up their savings. For the individual trying to retire early, he should focus on increasing his retirement savings.
Put Reminder Notes Around the House
Memories can fade, but each time you look at the sticky note on your computer, you’ll remember your financial goal – pay off the debts so I can quit my day job. Each time you see that reminder, you’ll know that there is a reason for the focus, the effort, and for the sacrifices you are making to accomplish your financial goals.
Start a Budget
Making a budget is just like putting up road signs with arrows. You are telling your dollars which direction to go so that you can reach your financial goals.
Make sure your budget is a mirror reflection of your financial goals
Some people say they want to be debt-free more than anything else in the world. However, in their budget they still allocate several hundred dollars a month to dining out. What they say they want and how they budget don’t agree. The budget must be pointing in line with the direction of your financial goals.
Anticipate Challenges to Your Financial Goals
Goals are rarely reached without first overcoming some challenges. Something will try and get in the way of forward progress. An emergency fund is one way to anticipate financial challenges. If you are working towards traveling for a year, you need to be sure that you have some financial margin so that an increase in airfare doesn’t destroy the possibility of accomplishing your goals.
Other challenges may include things more illusive things like opposition from friends and family. Anticipate those challenges and formulate some good responses.
In desperation, your creativity is unleashed. It is amazing how much someone can perform when they are required to. We’ve probably all had times in our lives where we did something we never thought possible. In this case, you should cut and cut your budget. See if you can live on a set dollar amount, and then challenge yourself to cut it by 5%. For many of us, our standard of living is set by our income. If we find a way to decrease expenses with the same income, we will reach our goals much faster.
What tips do you have for accomplishing financial goals?