The start of a new year often brings new personal goals - many involving new ways of managing time and money. As you embark on another year of setting goals, consider what goals really are, what life is made of, and why the right activity is so important.
When we talk about goals, we are really talking about living the life we want to live. Goals aren’t some lofty thing that would be nice to achieve. They are essential to living the life we each dream of.
When you set your goals this year, think about what you want your life to be like.
This thing we call life, in many ways, is defined by our health, wealth, relationships, and experiences. When setting goals this year, we are in effect deciding what life we want to live later. Be specific when you set your goals in these areas.
How do you define good health, ample wealth, wonderful relationships and fulfilling experiences?
Most people give up on their New Year's Resolutions before they even get started on them. That means they are giving up on living they life they want to live. To make sure that doesn't happen to you, let me share a new approach to achieving your New Year's Resolutions.
Five steps you can use to achieve your New Year’s Resolutions:
1. Know what activity you need to engage in to achieve your goals, i.e. the life you want. You cannot be an expert at everything. In cases where you are not an expert, know enough to ask the right questions and to understand the answers but lean on qualified and trusted advisors to advise you on the activity that will bring you success.
2. There is no doubt that humans have a herd mentality. Make sure you are in the herd that is going to allow you to be successful at living the life you want. Surround yourself with people who can serve as role models, or at the very least, cheer you on. This may mean changing your environment and who you spend time with.
3. Use technology to track your activity daily and your progress occasionally. Results will take months or even years to show up. Instead of measuring results, break it down by measuring bite-size activity daily. Measure progress toward your goals at least annually, or more often as it makes sense.
My clients have access to eMoney to track their budget and spending, and their goals towards paying for college expenses, and having ample income in retirement. They use the vault in eMoney to securely store important documents and images related to their health and wealth for when they travel, in case of an emergency, or for estate planning purposes. eMoney is available on mobile and desktop devices so they can use it at home or on-the-go. Contact me to learn more about eMoney and the valuable role it can serve in your life.
4. Reward right activity. This means don’t beat yourself up when you get off track and don’t wait until you achieve the results you want to reward yourself. When you reward yourself for right activity, you incentivize the commitment and effort necessary to realize the life you want.
As a suggestion, don’t reward yourself with something that will slow down your progress or worse yet, take you in the opposite direction. For example, if your goal is related to your health, then a reward of eat-whatever-I-want-night is not going to help you stay on track. Rewarding yourself with a new workout outfit may be a better choice. Likewise, rewarding yourself with a vacation that is not in your budget for maximizing your IRA this year is going to set you back, not help you maintain momentum.
5. Look for ways to overlap your goals. So often goals are competing with one another. Look for ways they can actually support each other. Here are some examples:
- Give up the high price gym membership you never use after January anyway. Go with one of the affordable online programs. It will cost less, save you time driving to and from the gym, and is available 24 hours a day, 7 days a week, 365 days a year in the comfort and convenience of your own home.
- Invest in income-producing investments outside of retirement accounts now that can provide funds for family vacations in the future and income for retirement later.
- Buy a permanent life insurance policy to protect your family now and provide income for you later when you need it due to inflation during retirement or for long-term care.
- Contribute to a NIMCRUT, a type of charitable trust, to potentially save on taxes now, provide income for you when you decide to take it later and support your favorite charity when you pass on.
- Contribute to a Pooled Income Fund to potentially save on taxes and generate income now, and support your favorite charity when you pass on. Pair this up with a permanent life insurance policy and you enjoy a potential tax deduction on your contributions, income that can be used to pay the life insurance premium, a charitable donation at end of life, and a death benefit from the life insurance policy to your heirs.
It is human nature to be impatient on the one hand, wanting to live the life we want to now, and complacent on the other hand, not really wanting to do what it takes. In reality, most of us have to be actively engaged in creating the life we want in the future. Like Dave Ramsay says, “Live like no one else today so you can live like no one else later.”
As certain products may not be suitable for all investors, it is important we have a conversation to make sure they are a good fit for you. You can contact me by email at email@example.com.
Fran McKay, CFP®, AAMS®, CRPC®