Aug 05, 2022 / Money Tips
Today, it seems that everyone is an expert on the topic of personal finance and they all seem know exactly what you should be doing with your money. What they seem to miss, however, is that personal finance should be—as the name implies—personal. After all, you’re on your own, unique financial path and your goals should be your own—not those of your in-laws or some social influencer. The important thing is not that you achieve what everyone else thinks you should, but that you learn to follow through on your own financial goals. The following tips will help you select financial goals for yourself and then follow through with them all the way to success.
If you have a dozen goals, you’ll likely fall short of most of them. If you only try to tackle one or two challenges at a time, your chances of success increase. Many goal gurus teach that “the more goals you set, the less likely you are to achieve them.” In addition to limiting the number of goals, be sure that each goal is clearly defined. What exactly are you trying to achieve and how exactly will you know when you’ve succeeded? The focus and clarity that come from picking a few, well-defined targets can make it easier to achieve personal goals, both big and small.
When it comes to financial goals, good intentions are a great start, but most people have a hard time holding themselves accountable. That’s why it can be helpful to tell your goals to someone whose opinion you value and whose status you’d like to emulate. Research suggests that, “people have greater goal commitment and performance when they tell their goal to someone they believe has higher status than themselves.” The right accountability partner can apply external pressure and increase your own internal drive to succeed.
When evaluating the various factors that contribute to a person’s success, an increasing body of evidence suggests that willpower is vastly overrated. In fact, many successful people intentionally eliminate willpower from the equation, opting instead to rely on systems. According to the experts, “systems work because they create situations in which the need to use willpower has been decreased or removed entirely. By building systems into your life, you increase the chances of following through on the actions that matter to you.” If, for example, you have a goal to stop overspending and to start saving more, consider setting up a regular, automatic transfer into a money market account or stashing some cash away in a term deposit account where you can’t access it for a while.
Ask any financial expert and they’ll tell you the importance of having financial goals. Unfortunately, in many cases, they’ll also tell you what those goals should be. Everyone is on their own financial journey and everyone should set their own financial goals. The important thing is that you also learn to follow through on those goals until you achieve success. To do that, enlist an accountability partner, pick a clear priority, and rely on systems instead of willpower. While simple, those small actions can increase your chances of success while improving your personal finances.