Everyone has financial goals, but very few of us ever reach them. Is it a lack of discipline, awareness, financial resources, or education? Is it simply because the economy isn’t friendly to the average Joe? The truth is when we can’t reach our goals, it’s very rarely someone else’s fault. We have a tendency to blame our environments, the economy, the health of the markets, etc., but at the end of the day, only you can reach your own goals.
Here we’ll cover five tips for consistently reaching your financial goals. If you’ve got a goal to save for a house, create wealth, fund an emergency account, or some other financial goal, this guide is right for you. Keep reading to learn more!
Table of Contents
1. Stop Spending Money
This is perhaps the most difficult skill to master when it comes to reaching financial goals. After all, we live in a society where we’re defined by our stuff. According to the American Psychological Association, those people who spend their lives chasing material things are generally unhappier than those that don’t. Why is that?
For one thing, spending money on material things doesn’t lead to further wealth. It doesn’t matter if you’ve got the latest iPhone in your hand, or the biggest house on the block if you’re broke after buying it. The problem with spending all of your money on things is that it’s never enough.
And it’s set up that way. You can see it everywhere you look. We’re bombarded by ads, billboards, commercials, and marketing all day long. It’s on our computers, our social media pages, our coffee cups, on the street; everywhere you look, there’s an ad of some kind.
According to these game-changing financial freedom tips, buying less can actually help make you more wealthy. When you live inside your means, you’re not spending every extra penny on pointless things. At the end of the day, it’s not the things in our lives that bring happiness and fulfillment anyway; it’s the people and experiences.
You know you’re not supposed to keep spending money you don’t have, but what happens when that electronic or clothing item you’ve wanted for so long goes on sale? You can feel your blood pumping, your brain screaming get it now while it’s on sale!
This is where discipline comes into play. Discipline is the key to reaching any goal, not just financial ones. Why? Because discipline makes you stay on course, even when other things or people would have you deviate. Discipline helps you hold the vision, put in the work, and restrain yourself when temptation comes knocking.
That’s not to say you should never buy anything, but if you’re trying to reach a specific financial goal, you must be aware of your temptations and how they impact those goals. Once you know what they are, you can discipline yourself against them.
3. Know Your Goals and Be Specific
When you’re setting financial goals, it’s not enough to say “I want to save more money. Broad statements such as this can quickly become thoughts we shove to the back of our minds and don’t put in the effort to achieve. Be more specific with your goals.
Let’s say you want to save money. How much? What are you saving for? Your goals and your process will vary depending on why you’re saving. If you’re saving for retirement, the amount you’ll need to save and how you’ll save it will be different than if you were saving for an emergency fund.
Instead of saying “want to save more money,” say “want to save $10,000 in the next 18 months”. By clearly defining what you’re reaching for, you’ll have a well-planned goal to focus on, rather than a whimsical thought that bounces around your head all day.
4. Good and Bad Debt
Debt is usually what holds people back from their financial goals, but many of us make the mistake of assuming that all debt is bad debt. The truth is, there are two kinds of debt; the debt that builds equity, such as a mortgage loan, and the kind that is used to buy things that depreciate in value.
This is usually credit card debt or personal loans. Even car loans are considered “bad debt” since cars immediately depreciate as soon as you drive them off the lot. Knowing the difference can help you formulate a better plan for eliminating the bad debts holding you back from your financial goals.
5. Ask For Support
When you’re reaching for any goal, it’s always a bit easier when you’ve got a support system under your feet. The same goes for financial goals. If you’re trying to get out of debt, spend less, or accumulate wealth, enlist the help of a trusted friend or family member.
Don’t confuse “help” for borrowing money from them. By help, we mean support for you as you reach your goals. This can be in the form of asking your friend or family member to pursue the same goal as you. Maybe both you and your good friend are in credit card debt. Or you can even get help from great financial literacy programs that can teach you how to reach the financial goal you have set for yourself properly.
You can both set the same goal to eliminate your debt by the end of the year. That way, you’re not only getting support, but you can build each other up on your successes and help pick each other up when you falter.
Featured image source: Freepik