Good Golly; GOALS!

 

So you made the commitment to get all you want on what you make. Congratulations. I have good news and not so good news. The good news is that no matter what income bracket you are in it is possible to achieve your goals. The not so good news is that it will take a bit of hard work and dedication. In order to get what you want you need to set goals. People who are successful at achieving their goals most likely charted out both short-term and long-term plans to get there.

That means mapping out timelines, tasks and deadlines along the way and sticking firmly to them. Sounds tedious, I know. OK, it is, but try it out you will see it really works. And once you master the skill set required to set goals you can use it to do anything. Money, weight loss, travel, education, retirement. It doesn’t matter what you want, you can get it by setting and following your plan. The key is that you really need to want it.

So what is a goal? Simply put a goal is two things, 1) something that you are willing to work for, and 2) something that you achieve by making and following a plan. Not so scary now is it? After all, we all have goals. Some might be to get out of debt, go on vacation, or buy a Masserati (mine). Well, maybe the Masseratti is more of a dream. How about college? Tired of renting? Then buy that new house you like. Afterall, the housing market has never been better and you will increase your investment portfolio.

Have you ever wondered why other people can do those things and you can’t? The straight forward answer is that they made a plan and stuck to it. I hear you. You’re saying,” but I have a plan. I plan to get out of debt.” Sorry to tell you this, but that is not a plan…. that is your goal.

Now let’s show you how to make that goal a reality by creating a plan to do it. First you will need to decide what kind of goal is it. Is this a short-term goal (something that can be done in less than a year) like saving $500.00 for your Christmas spending account, or is it a mid-time goal (takes more than a year but less than five) like getting your college degree or buying a car or house. If buying a car or house is considered a mid-term goal then what is the definition of a long-term goal? A long-term goal can take anywhere from six or more years to accomplish. A great long-term goal for many of us is setting ourselves up to retire. I’m of the opinion that no one should rely on Social Security.

Take a moment to list your goals and categorize them. Done yet? OK, let’s look at one of your short-term goals. Are you ready? Get a piece of paper and WRITE DOWN YOUR GOAL. Think about when you want to do it by and write that down. You now know two things; what you want and when you want it by. But just how do you do it? Think about what it will take to accomplish your goal. How much will it cost? How much can you afford to put toward it each month? Here is a quick way to organize your thoughts with the key questions you will want to answer.

Goal Chart

It’s a good idea to start with a small goal–one you can achieve. Achieving smaller goals can help you plan for and accomplish larger goals. Here is a sample short-term goal: buying a new TV. You find out that it will cost $240.00. That is a small chunk of change to have lying around. But if you break it down to saving $30/month then $240 doesn’t seem like so much money. That’s more do-able than trying to come up with $240 all at once.

Let’s look at setting up a vacation fund. You decide that you want to take a 4-day cruise from LA down the Baja and you live in Portland, Oregon. You research the costs and find out that airfare will cost you around $85.00 round-trip on Spirit and the cruise is charging $499 per person for double occupancy (of course you only need to pay for yourself). Don’t worry about food costs. It is an all inclusive vacation. Of course, you will probably want some spending money so let’s plan on $50.00 a day, that’s $400.00 for spending. After you add it up you find that you will need an even grand to do it. $1000.00? Are you kidding me? You are wondering now just where in the world you are going to get $1ooo.oo dollars.

Don’t panic, take a look at your budget and find out how much you can put away each month. At a $100.00/month you could be basking in the sun by next May. Sounds great, huh? After all it is still raining in Portland and will be for at least another month, maybe two. But most of us don’t normally have an extra $100 lying around. So you have some decisions to make (get out that chart). You could change where you want to go, or change when you want to go. Maybe plan it for 2o months out. That would require only $50 dollars each month out of the budget.

Depressed yet? Don’t be. Let’s go back to your goal. How bad do you need that vacation? If you are like me….. desperately! Now look again at your spending each month. We all spend money on things that aren’t technically in our budget. Daily coffee at Starbucks? Dinner out once a week? A movie once a month? Doesn’t seem like much, but let’s add it up for the month. $40.00 for coffee ($2/day for 20 days), $60 for dinner ($15/week for 4 weeks), and $15 for one movie. Wow! that is $115 in one month and that doesn’t include the popcorn you bought at the theatre. I know, we all need our coffee in the morning… But do we need it from Starbucks? If we brewed it at home we would spend $15.00 for the month and that would still leave us the $100.00 we would need to take that vacation in ten months. Yippy. Pack your sunscreen.

Just a quick recap on getting what you want.

• Decide what you want to accomplish.
• Write it down.
• Find out the cost (research for the best deal)
• Decide on a deadline for the purchase
• Figure out how much you can put toward it monthly
• Adjust deadline or budget accordingly
• Stick to the plan

See? Not so hard… now start making plans. There is one more important thing to remember. PLANS CHANGE because life does. That doesn’t mean you need to abandon them, just make adjustments and you will get there.

Now onto learning how to plan your spending. AKA… budgeting.