A lot is written about goals & we've written a piece on the importance of goals on your finances here.
What we'll help you to do in this post is take a step back and examine if goals or habits are the "best" way or why not a combination of both?
Goals, habits or both?
The great thing about goals on your finances is that you generally can see if you're succeed or not. This then highlights a flaw of a goal based life or process.
What happens if you were ahead of your target, then at the last minute you had to replace a TV to make sure you could watch netflix as you simply couldn't live without the latest Game of Thrones episode. Sure this is tongue in cheek however it highlights a point on the flaw of a goal. As humans we don't necessarily make decisions based on logic, we make them based on emotion and how the outcome is likely to make us feel. What does this mean then?
Consider the habit that you're looking to create with the goal
Rather than focus on a black or white, pass or fail outcomes consider the habit after determining the outcome you want to achieve.
What this means is that rather than the goal being the way, it is a combination of both goals / habits that can help you to achieve success in money, fitness, relationships and life.
An example that shows this is fitness and the gym:
- Imagine your goal is to lose 5 kgs in 1 month, which is specific and timeframe based, a good goal right?
- You get to day 30 & you've lost 4.5kg's, a decent effort one would think. What happens next though?
- Over the next 60 days, you fall off the exercise / diet bandwagon and put on 5.5kg's, meaning you've actually not put on an extra kg.
- Rather than focus on the goal, which is still important, why not consider the habit you will create i.e. working out first thing in the morning, eating at least 2 servings of salad a day or drinking 3 litres of water a day instead of 2 coffees. If you look at the habit, the goal should take care of itself & it will be more sustainable over the longer term
Sure, it may not be this easy however the alternative is going backwards and not achieving what you really want and deserve from your financial life
What habits are you looking to create in your life?
What has stopped you achieving goals in the past?
Let us know any questions you'd like to answer and we'll give you our thoughts! Remember to live your Money Glee!