Everyone says that goals must be SMART. But sometimes, SMART just doesn’t work. Sooner or later, everyone feels the weight of these goals. And then they become just a decoration on our walls. But there’s a SMARTER way to do things. There’s a SMARTER way to setting goals for your money.
I’m sure many of you are familiar with SMART: Specific Measurable, Attainable, Relevant, Time-bound. But here is what SMARTER goals look like.
Envision this scenario. You go to a salon or a barber and they ask you for what haircut you would want. Many of us know that it is not smart to tell your hairdresser to surprise you. You would not be so vague and tell them you just want a short hair. That’s a big no. You would at least describe the type of haircut you want. Some would even go as far as bringing a picture just to make sure you are on the same page. Congratulations, you just gave out very specific instructions.
The same with money goals, you have to be specific. Let’s work on this goal to make this specific.
Goal: I want to have financial freedom.
What does financial freedom mean? What do you need to do to gain financial freedom?
A more specific goal can be any of the following. Notice that in the process, you have defined what financial freedom means for you.
Now you know what you want to achieve. It’s time to make it measurable.
So back to the hairdresser scenario again, you want a shorter hair. So you have to tell him by how much you want your hair to be shorter. Do you want it shorter by two or five inches?
Now back to our example, here are our measurable goals. You need to know how much you need to do in order to say you are achieving your goals. If you’ve checked yourself against your personal finance coordinate system, this will be an easy exercise for you.
When setting goals, ask yourself if you know if your goals are realistic and possible.
The good news is that we have a lot of self-made millionaire stories so I’m convinced that there are hardly any reasonable money goals that are not attainable.
The question now is, do you have what it takes to attain them? Most of the time, we are the ones who put the limits on ourselves. Or we are not ready to give what it takes in exchange for achieving our goals.
So instead of asking whether your goal is attainable or not, I would advise you to re-phrase the questions to these:
Again, look at your life and your needs. Is the goal you are trying to pursue relevant to your life. Do you see its importance to you?
Why do you want to be financially free? What does it entail? What will you have after achieving this goal? Is this really a need for my goal?
Let’s look once again at our goals. Do you think all three are relevant if you want to achieve financial freedom?
Paying off your loans and building a passive income are relevant goals toward being financially free. But examine the third goal. Do you think it is a goal to achieve financial freedom? Or is it a goal after financial freedom has been achieved?
I propose to look at this travel budget goal as not relevant to the goal of being financially free. I’m not saying that it is not a goal. All I am saying is that to be financially free, this goal is not relevant.
In addition, do you understand why it is important for you to achieve these first two goals?
Our lives our time-bound, so should our goals be. If we don’t put target dates, we’ll soon find ourselves procrastinating. So make sure that you set targets to your goals.
In this stage, make sure that your timing is reasonable. If you have to build skills or to do other steps to make this happen, factor it in.
Make your goals time-bound as below:
The next step to is to find goals that will make you feel for it. There are already many goals out there that are SMART but they fail to be realized. Do you know why? That’s because it lacks the human factor.
When you set out your financial goals, do you do it because you want to, or because you need to? Both needing it and wanting it are strong moving forces to achieve your goals. However, if you are just doing it because you need it, you might not enjoy the process of achieving your goals.
If you don’t have an emotionally-gripping desire, it will be difficult. So find that strong reason why you want it, other than needing it. This involves an internal look at ourselves.
I ask you again, do you have that emotionally-gripping desire to set your finances right?
I strongly believe that our goals should be directed toward what is really right and good. We should never lose sight, and we should not shut that voice, that calls us to be a positive catalyst in the world. Though our spheres of influence might be different from each one, we should be conscious that our goals do not proliferate the evil in our society.
Based on experience, I really believe everyone is good and if you don’t make sure that your financial goals are righteous, the lack of peace that you will feel when you achieve your goal will rob it of its sweetness.
How do you know if your goal is righteous? I only have a few points below.
Although it’s SMART to achieve your goals, nothing’s SMARTER than achieving peace within yourself.
Don’t just be SMART, be SMARTER.
Go and inspire the world.
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