Thursday, January 21

Your financial goals: Dream or reality?

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“If you want to live a happy life, tie it to a goal, not to people or things.” — Albert Einsteen

When I search for the meaning of a goal, the simple definition I get is desired results a person envision, plans and commits to achieve.

Whenever I ask my clients on what their financial goals are, the common answer I receive is; to buy a bigger house, to buy a new car, to go on a world tour, to build their children’s education fund, for their retirement fund and the list goes on.

I immediately ask them; if you can’t achieve any of your goals which you have listed down, will your life will be less happy? They start looking at me and ponder on what I’m trying to say!

Some even start thinking if I am here to help them achieve these goals or if I am merely wasting their time.

Financial goals are what we want to achieve in life, and they’re much more meaningful than just ‘what we need to accomplish to survive’. Unlike daily routines or short-term wants, financial goals drive our behaviours over the long run.

Financial goals should help us determine what we want to experience in terms of our life value. Financial goals should give us a sense of direction and make us accountable as we strive for happiness and well-being.

Have you thought about your financial goals can bring value to your life besides the monetary benefits? Well, here are some of the values it brings to you;

High aspiration and motivation

The action of setting financial goals and the attention we put into developing them leads our interest to the why, how, and what are our aspirations. As such, when we realise our aspiration, it immediately gives us something to focus on and creates a positive impact to our motivation level.

On the contrary, when we set our financial goals without any aspirations, then these goals remain merely a dream without developing into a reality.

Setting financial goals just for the sake of doing it won’t drive the actions that lead us to success.

Let me give you a real-life example; you have two goals where the first one is to climb Mount Everest and the second is to buy a brand-new car.

Both these goals will financially cost you almost the same amount of money.

There is nothing wrong in both goals, but in my personal opinion, in the long run, the first goal contains the inner sense of achievement and happiness that you may not derive from getting a brand-new car as we can still substitute the brand-new car with something of a lower cost.

Clarity and focus

Clarity is knowing exactly what you want to achieve. Financial goals develop clarity and answers some important questions on what our goals are, by when you want to achieve them and how much you would need to invest in them.

Knowing the answers for these questions give absolute clarity and enables you to decide on what you need to do next.

Staying focused is a critical attribute that allows us to begin a financial goal without procrastination, consistent in giving attention and putting effort until we achieve it.

Staying focused helps us concentrate in the midst of distractions and setbacks towards sustaining the effort and energy needed to reach our goals.

Once you have clarity and focus you will be able to work towards your goals no matter what may come your way. Let’s compare a GPS system in your car; a GPS system in your car will show your current location and the destination you want to reach.

The GPS gets you from where you are to where you want to be. Clarity is where you want to go. Staying focused is doing what you need to do to get the car to its destination; following the speed limit, wearing your seat belt, etc.

Every choice you make behind the wheel will either get you closer to your destination, or further away.

To further ascertain, the GPS is the guide, which will shorten your travelling time and ensures you don’t get lost, end up driving aimlessly whilst wasting fuel at the same time.

Take control of your life

When we don’t set financial goals, we will spend our whole life running up and down and not achieving anything. If we don’t understand who we are and what we want, our surrounding environment will influence us to be the way it wants us to be.

Many people today are moving in a robotic life. Even though they work hard, they don’t feel like they are getting what they want.

That’s because they don’t have a direction of where they want to go and what they want to achieve.

When you start to set financial goals and think about what you want, you break out of the auto-pilot mode and start living a life of your conscious creation.

Instead of letting others tell you what to do, you proactively take charge and think about what you want for yourself.

With each passing year, we become a year older and wiser, time passes as the clock is always ticking.

As precious as time, financial goals with specific measures and timelines should develop meaningful and memorable life experiences, besides creating monetary value.

Financial goals need to reflect your strengths and weaknesses. Financial goals need to help you achieve your highest potential. According to Zig Ziglar, “What you get by achieving your goals is not as important as what you become by achieving your goals.”

Gunaseelan Kannan, a licensed financial advisor by Bank Negara Malaysia and a licensed financial planner by Securities Commission, is currently pursuing his PhD research on financial planning and financial technology. He also lectures on accounting, finance and business fields. He is the Malaysian Financial Planner of the Year 2018 and 2019 Award winner (1st Runner Up), from Financial Planning Association of Malaysia. He can be contacted at [email protected]