Is Your Financial Goal Set Correctly?
There are two questions I want to attempt to tackle in this post: firstly, is your financial goal (assuming you have one) set at the right level; and secondly, have you got your performance goals correctly set in order to support your financial goal? I believe that you need to think about these two things very carefully.
I have just finished listening to a little book with the intriguing title The 2X Method.
I was send an evaluation copy and I really enjoyed listening to Bill Stacy reading it.
It is not really a book about how to increase your income, though Bill does have a few tips in that area; it is about adjusting your mindset in relation to money.
If you are earning enough, Bill argues, and enough may not be as far away as you might think, then you will have 99% of the feeling you would have if you were indeed a millionaire.
The essence of the message in this book is that you don't need to become a millionaire in order to be happy and that many people are engaged in chasing financial goals that are way in excess of what they actually need in order to achieve the underlying outcome they really crave - happiness.
I found the thinking quite refreshing.
Early on in the book, Bill asks the question: how much money do you want to earn? And he goes on to provide the answer that most people might come back with.
Before I tell you what that is, ask yourself the question and listen to your own answer.
So go on, humour me for a moment: how much money do you want to earn? I'll let you know that my answer was not the apparently common one.
My answer was the figure that I had already set for my financial goal that is the equivalent of what I was earning full time in my previous job teaching management courses.
At present, my full time income from my web activity is below that figure and once I have managed to create a passive income that is equivalent, I will be ready to check that goal from my list.
So, what do most people answer? What do you think? Apparently, most people say something like 'as much as possible' and the problem with that answer is that they will never manage to achieve the goal.
It will always be somewhere over the horizon and out of sight.
It's not just that the goal is incorrectly set i.
e.
not specific and measurable, though these are important considerations for any goal, it is that 'as much as possible' is not what will bring the happiness they really seek.
Recently, I have been reading another book that also caused me to think about my current major goal, which indeed has been my major goal for the past seven years: to achieve financial independence.
What I am reminded of is that financial goals are outcome goals.
There is nothing wrong with having outcome goals, of course, but we also need performance goals - things we can actually focus upon and make happen with our own effort.
To have a financial goal - whatever the amount - is all well and good, but how do you actually achieve it? Well, there are various schools of thought including the ridiculous idea (to me) that you don't need to do anything because it will just magically appear out of thin air because somehow you will have caused the universe to deliver it - this is how some people are teaching the law of attraction these days.
Personally, I am not against the idea of the law of attraction; just the notion that you can create your own reality simply through the process of thinking.
Don't get me wrong, I believe that thinking is a vitally important component of achieving your goals.
It's just that I am in the camp that thinks they will also require a bit of effort on your part in order to make them real.
So, the point I wanted to make was that I think that having a financial goal - however you state it - is all well and good.
I don't think there is anything wrong with that; it is simply a reflection of how our economies work.
We need money to be able to do what we want to do.
But financial goals are essentially outcome goals and so we also need performance goals in order to connect them with personal effort.
For example:
I know that if I can set the right performance goals and achieve them that I will also achieve my outcome goal.
This is exactly what the athlete Roger Black said when I saw him speaking a few years ago as a guest speaker at an annual conference.
So, take another look at your goals.
Are they outcome goals? If so, that's great, but are you going to rely upon the universe to deliver your outcome or are you going to set about the process of making it a reality through your own effort? If that's what you intend to do, then make sure you have also set the correct performance goals because that is what is going to get you there in the end.
I have just finished listening to a little book with the intriguing title The 2X Method.
I was send an evaluation copy and I really enjoyed listening to Bill Stacy reading it.
It is not really a book about how to increase your income, though Bill does have a few tips in that area; it is about adjusting your mindset in relation to money.
If you are earning enough, Bill argues, and enough may not be as far away as you might think, then you will have 99% of the feeling you would have if you were indeed a millionaire.
The essence of the message in this book is that you don't need to become a millionaire in order to be happy and that many people are engaged in chasing financial goals that are way in excess of what they actually need in order to achieve the underlying outcome they really crave - happiness.
I found the thinking quite refreshing.
Early on in the book, Bill asks the question: how much money do you want to earn? And he goes on to provide the answer that most people might come back with.
Before I tell you what that is, ask yourself the question and listen to your own answer.
So go on, humour me for a moment: how much money do you want to earn? I'll let you know that my answer was not the apparently common one.
My answer was the figure that I had already set for my financial goal that is the equivalent of what I was earning full time in my previous job teaching management courses.
At present, my full time income from my web activity is below that figure and once I have managed to create a passive income that is equivalent, I will be ready to check that goal from my list.
So, what do most people answer? What do you think? Apparently, most people say something like 'as much as possible' and the problem with that answer is that they will never manage to achieve the goal.
It will always be somewhere over the horizon and out of sight.
It's not just that the goal is incorrectly set i.
e.
not specific and measurable, though these are important considerations for any goal, it is that 'as much as possible' is not what will bring the happiness they really seek.
Recently, I have been reading another book that also caused me to think about my current major goal, which indeed has been my major goal for the past seven years: to achieve financial independence.
What I am reminded of is that financial goals are outcome goals.
There is nothing wrong with having outcome goals, of course, but we also need performance goals - things we can actually focus upon and make happen with our own effort.
To have a financial goal - whatever the amount - is all well and good, but how do you actually achieve it? Well, there are various schools of thought including the ridiculous idea (to me) that you don't need to do anything because it will just magically appear out of thin air because somehow you will have caused the universe to deliver it - this is how some people are teaching the law of attraction these days.
Personally, I am not against the idea of the law of attraction; just the notion that you can create your own reality simply through the process of thinking.
Don't get me wrong, I believe that thinking is a vitally important component of achieving your goals.
It's just that I am in the camp that thinks they will also require a bit of effort on your part in order to make them real.
So, the point I wanted to make was that I think that having a financial goal - however you state it - is all well and good.
I don't think there is anything wrong with that; it is simply a reflection of how our economies work.
We need money to be able to do what we want to do.
But financial goals are essentially outcome goals and so we also need performance goals in order to connect them with personal effort.
For example:
- Outcome Goal: To achieve financial independence
- Performance Goal: To make 5 blog posts per day
I know that if I can set the right performance goals and achieve them that I will also achieve my outcome goal.
This is exactly what the athlete Roger Black said when I saw him speaking a few years ago as a guest speaker at an annual conference.
So, take another look at your goals.
Are they outcome goals? If so, that's great, but are you going to rely upon the universe to deliver your outcome or are you going to set about the process of making it a reality through your own effort? If that's what you intend to do, then make sure you have also set the correct performance goals because that is what is going to get you there in the end.
