How To Change Your Life By Setting Financial Goals
So how are you getting on with your New Year’s resolutions? Yes that’s right, all those promises that you made to yourself back in January about doing more exercise, eating healthier food and cutting back on spending. We are now more than half-way through the year and for many, those good intentions are long forgotten and mentally-shelved, only likely to be temporarily dragged back to the front of the mind next January, which is a shame because resolutions can be a powerful way of changing our lives for the better.
Photo by Jean-Louis Zimmermann via Flickr
The Power of Setting Goals
Effectively resolutions are goals, something that we want to achieve and by having goals in life we have something to focus our energies on. By setting realistic, but equally challenging goals and creating plans to achieve them, it is possible for us to proactively improve the way we live, whether the goal is to lose weight, move to a bigger home, go on a world-wide trip, start a family or whatever else we feel is most important.
My Goals in Life
I have a number of goals, many of which are financially related and tend to revolve around increasing my income, reducing my costs or saving up for a cool trip abroad. I also try to use the principles of SMART goal-setting.
Visit New York
For example one of my short-term goals this year is to visit New York (I live in England by the way), therefore my goal looks like this:
- Specific – Save for a trip to New York
- Measurable – I’ll need about £1,100 for flight, accommodation and spending money
- Achievable – Yes, I can afford the cost by putting aside some money each month
- Realistic – Yes, this is not a trip to the moon and back
- Timely – I want to go late November / early December of this year
The financial plan for achieving this goal is simple. From January onwards, all I have had to do is put aside £100, so that by November I will have covered all my costs. I can also stagger the expenditure, buying the tickets first by the end of July, booking the accommodation by the end of September and having my spending money ready by November.
Salary Increase
Another short-term goal I had at the start of the year was to increase my salary by 20%. I knew that in the current economic climate my employer would not support such a significant raise, so the alternative was to look for new positions in other businesses.
In short I went through the motions of distributing an updated CV to all the major job boards and began networking with a number of recruitment agencies. After a couple of interviews I finally landed a job working for a close competitor and managed to exceed my original goal.
All this resulted from making a decision to make a change and then pro-actively putting that change into place.
Knowing Where You Are
Setting goals and determining ways to achieve them is very similar to finding your way around with a map. Your destination is your goal and your route is your plan on ...
