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It is interesting that most people do have plans for the holiday or for how much weight they want to lose or what their children should become after school, but very few people have financial goals or a plan to achieve those goals. When I ask during a financial talk ‘who wants to become financially free?’ or ‘who wants to be rich?’ everybody would raise their hands. When I ask ‘what does financial freedom mean to you?’ and ‘what does rich mean to you?’ limited people have a clear answer.
Dreaming about being financially free or being rich, are not clear defined goals. Each person can define the term rich in a complete different way. Your age, your life situation and your experiences also play a role in your definition of rich. Younger people tend to have more material financial goals while goals tend to become less material as people age.
Think about what is happening when you want to lose weight. You would be specific by saying ‘I want to lose 8kg’. You can make that statement because you know what your ideal weight is and also how much you are currently weighing. It becomes much easier when your future goal and current state are known and clear. Then you can compile an exercise and diet plan that will help you to lose 8kg to achieve your goal weight. Thereafter you will have to implement your exercise and diet plan. If you don’t take action to implement your plan, you won’t lose the required 8kg.
To set financial goals, you will apply exactly the same steps:
- Step 1 – Define your future goal by setting SMART goals. S = specific; M = measurable; A = achievable; R = relevant; T = timelines.
- Step 2 – Analyse and understand your current goal.
- Step 3 – Compile a plan to get you from where you are currently to achieve your future goal.
- Step 4 – Take action to implement your plan.
Start off by taking small steps, but at least start working towards achieving your financial goals in life.
During the next few weeks I will be discussing the 10 financial concerns many South Africans have in more detail – subscribe to my YouTube channel and follow all the discussions.
Written by Ronel Jooste
CA(SA), Financial Consultant and Coach, Blogger and Speaker
Contact Ronel: firstname.lastname@example.org
For more information about my financial wellness programmes visit the website