I Want To Be Rich Someday! How To Set Solid Finance Goals
This is a guest post by Mark over at @ Financing Your Family, a newer blog that focuses on helping readers to be “smarter with their money, closer to their family, and willing to work towards worthwhile goals”. Lend him some support by checking out his site.
When I talk with people about there financial goals, there is one thing that tips me off as to whether or not they will be successful or not, and that is how they describe their goals. Some examples of goals I’ve heard are: “I want to be rich someday,” “I want to have kids,” and “I don’t want to work for a large company.” These are all financial goals to be sure, but when people tell me that these are their goals, I usually think that they just don’t really care about their lifestyle that much.
You see, all of the goals I just named are what I call, No-thought goals. These are the hasty kinds of goals that cause people to start businesses in areas that can’t support that type of business. They strip away any semblance of plan by being short and edgy. I can’t call them bad goals because they are all good things to the person saying them. They are just poorly worded.
So, let’s break apart one of those goals, “I want to be rich someday” for example:
- How is rich defined? In dollars? $1,000,000, or $1,000,000,000? In possessions?
- When is someday? 5 years? 10 years? retirement?
- Who is I? If it’s just you, do you not want family? Do you judge wealth by family?
All of these questions (11 total in 10 seconds typing) need to be answered by the goal statement. So put some thought into it. A revamped goal statement for “I want to be rich someday” could be: “Twenty years from now, my goal is to be earning more than $80,000 a year, with a combined total net worth in excess of 4.2 million dollars, so that my family can live the life they deserve.”
The keys to making your goals good ones are:
- Thought– take some time to consider your wants and needs.
- Who– who will it impact? These people should be included in the goal-setting process too.
- What‘s the time frame? Put a deadline on your goal.
- Be specific, words have many definitions, this helps narrow down your meaning.
The goal process is one that is overlooked by so many people in America, but good goals are what keep you from debt, from foolish spending, and from poor investments.
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Hello! In my opinion Napoleon Hill”s “Think and Grow Rich” is the best guide to success. I posted on y blog some things about Hill’s principles of success and I also made a sort of parallel between success and failure. (http://mariaflorea.blogspot.com)
Best regards!
Marrisa is right. Nepolean’s Think & Grow Rich offers some valuable advice.
And so does this blog topic. Bravo to you and Financing your Family on this much needed subject.
I have to agree with Mark. It’s one thing to say you want to be rich, it’s another to state that you want to earn $120,000 a year. The latter is a tangible amount that you can create a plan to obtain.
By stating a specific amount of $120,000 a year you can break this down into manageable chunks that you can begin today towards achieving.
As an example, if you’re in sales and you make $50 commission for every sale, then you know that in order to make $120,000 a year, you’ll have to make 2400 sales. If you break this down into manageable chunks this would be 200 sales a month or appropriately 7 sales a day. Now based on your experience you know that you get about 1 sale for every 10 people you talk to, then you now know that you need to speak to at least 70 people a day in order to reach your goal.
But this is only half of the picture. If this same sales person was smart he would take a portion of his commission to invest in other things. By having his money work for him to earn more money and then by reinvesting not only the principle, but the interest earned, it won’t take long before this sales person has reached his goals.
Marrisa’s suggestion Think and Grow Rich by Napoleon Hill is a great book on developing a successful mindset. It’s actually one of my favorite (if not the favorite) book in my collection. Another amazing book and one I actually recommend more if you want to learn more about actually getting rich by better managing your money and actually have your money make money for you is The Richest Man in Babylon by George S. Clason. This book has completely changed how I look at managing my money and shows in very easy to understand stories that saving money can actually make you rich.
Shannon