Dec. 30, 2020

How to Set Money Goals You Will Actually Achieve (The Best Money Goals to Build Wealth This Year)

How to Set Money Goals You Will Actually Achieve (The Best Money Goals to Build Wealth This Year)
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Episode 34: How to Set Money Goals You Will Actually Achieve (The Best Money Goals to Build Wealth This Year)

In this episode we cover: 

  1. How to Set Money Goals 
  2. How to accomplish goals every time 
  3. Why habits matter more than goals 
  4. How to create systems 
  5. The best personal finance goals to set this year

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On this episode of the personal finance podcast, we're going to talk about how you can accomplish all of your money goals this year. What's up, everybody, and welcome to the personal finance podcast. I'm your host, Andrew, founder of dollar after And today on the podcast, we're gonna be talking about how you can accomplish all of your money goals this year. And what I'm going to talk about today is a specific system on how you can accomplish pretty much any goal that you want to accomplish in your life. Because the mistake a lot of people make is that they create goals, but do not create systems to back up those goals. If you don't have a system backing up your goal, you're never going to be able to accomplish that goal. And what that 99% of people do is they set a goal, they write it down somewhere, and they have no way of trying to accomplish that goal. They set up no system to accomplish that goal. They have no daily rituals or habits that backup that goal. And if this is you, if you've gone through life, and have not been able to accomplish a majority of your goals, if most goals that you set, you feel like you fail every single year, then this episode is for you. And if you want to go farther with your money next year, if you want to go as far as you possibly can with your money, if you want to increase your income, if you want to invest more money, if you want to save more money, if you want to pay down loans. And this is absolutely the episode for you. Because what I'm about to introduce to you is a system that if implemented, you can literally accomplish anything you want in life. But setting this system up is the first step to doing that. And once you set this up, you'll realize I can do this for anything in life. It's not just for my money. But what we're going to talk about today is how to set this system up for your money. And then what are some great money goals to have for this upcoming year? What are some of the best money goals that you can have for this upcoming year and give you some ideas. Because if you want to improve your personal finances, then this is where you have to start, you have to start with a plan, you have to start with a plan to take action, so that you can take control of your wealth and build wealth for your family's financial future. Because imagine if you could build generational wealth, and it all starts with that goal, it all starts with a single goal. And then you putting together a system to be able to implement that goal. So let's get into how you can accomplish any goal you want in life. So when you're approaching your goals, you have to look at it systematically. And having those systems to backup those goals is the only way that you're going to accomplish that goal. It's not coming up with a pie in the sky goal, and then never doing anything to accomplish it. Maybe you do it for a couple of weeks, maybe a month or two. And then all of a sudden, you realize that every single time that you set a goal, you get nowhere. Well the way to accomplish a goal, the way to fix that problem is to set up a system to back it up. And the first thing you want to do and the first thing I do when I want to set a goal is I define my three year vision and any new goal that I want to set, whether it's in fitness, whether it's in wealth building, whether it's in your career, any new goal I set, I set up a three year vision and what that three year vision, it gives you a little bit of time to kind of dream and dream about exactly what you want to do. Because what you're going to find out here is this is how you make your dreams a reality. This is how you actually accomplish your goals. So what you want to do is set up this three year vision. And what you want to do is get as specific as possible as to what you want to do. Maybe you want to increase your wealth, maybe you truly want to increase your wealth, we'll put down an exact number of what you want to do. Maybe in three years, you want to save $100,000 well write that down that you want to save $100,000 within the next three years. And this is super important because it gives you something to look forward to as you go about this process. And it's extremely important to have that vision to be able to look forward because your three year vision is the target, it's the target you want to hit. And the next steps are going to build the momentum so you can hit that target. So with every goal that I put forward, I always set up that three year vision. This podcast for example, I set up a three year vision before I started this podcast on where I wanted it to be. And the beautiful part is, once I started implementing my strategies every single day, this podcast has grown twice as fast than I ever thought it would be establishing that vision and working towards that goal is exactly how you're gonna get there. So that's the first step is establish your three year vision. The next step is to set up your one year goal. So this is what you guys are going to do for this year. So you have your three year vision in place. And you're going to set your one year goal Where do you want to be a year from now? Where do you want to be exactly one year from where you are today? Because that one year goal is extremely important. So let's say you want to Save $100,000 in three years, well, your one year goal is going to be to save 33 to $34,000 within one year. Now, that may sound very difficult to some people, that may not sound very difficult to other people. But that's why your goal has to be specific because if you want to save $100,000, then you have to take the necessary steps to at least get one third of the way there, which is 33 to $34,000. And this is where it is so important to take the steps because once you have that one year goal, and you start working towards that one year goal, you're going to be able to hit that three year vision that three years pie in the sky dream. The third step, the next thing you have to do is once you have that one year goal, you have to be able to check in on yourself. So you're going to create a 90 day benchmark. What that means is four times a year, every single quarter, you're going to have a benchmark in place that you want to check to make sure that you're on track because checking to make sure that you're on track is going to allow you to either accelerate towards your goal, or decelerate if you're too far ahead. And this is going to keep you balanced throughout the year. So this 90 day checkpoint is really, really important. And what I would do is every single quarter, every single three months, I would just create a day and your calendar, you could do it on your phone or whatever. And just schedule time and your calendar schedule time to have this checkpoint to make sure that you're on track every single quarter. Because what this does is it ensures that you're on the right track. And if you're too far behind, maybe your goal was too ambitious, you really can't do it. And you've been working your butt off non stop to be able to accomplish this goal. You've done everything you can and you're not even close to a quarter of the way there after the first quarter. And you say okay, I'm going to try for another quarter and see where I am you get to the next quarter, barely as far along as you were before, then what you want to do is dial back that goal a little bit, or maybe you're way too far ahead. And you need to push that goal forward, and make sure that goal is greater. So what this does is it allows you to find out exactly where you are without just wandering around. And this is extremely important to have check ins with yourself that keeps you accountable. Number four, you're going to create a weekly battle plan on how you're going to execute this. What that means is and here's what I do every single Sunday night, I pull out my phone, and I create a weekly battle plan. What I'm going to do that week, the things that I want to accomplish that week, because this weekly battle plan consists of things like ensuring what days that you're going to do what things so maybe you want to get more fit, you want to get into fitness, where your weekly battle plan is going to consist of setting out the days that you're going to be working out what you're going to be doing on those days, when you're working out how much cardio you're going to be doing, how much weight lifting you're going to be doing, and putting together a battle plan, so that you can accomplish exactly what you need to do. Because if you do this consistently, if you're doing every step you need to take consistently weekend and week out, then you're going to have no problem accomplishing that goal. Because all this is doing is creating consistency for yourself. This is creating a habit, a daily habit that you're going to be doing in order to accomplish that goal. And this is extremely important to be able to do that. Because the fifth step is to execute daily. And this is the most important thing, executing any goal in life, especially big goals. Seems like you're getting nowhere in the day to day life. Maybe you want to buy a rental property, your big goal, your big financial goal is to buy your first rental property. Well guess what? To buy a rental property in a year, you're gonna have to make a lot of offers. So what you want to do for your execute daily plan, and your weekly goal planning plan is to go out there and say, Hey, I'm gonna make three offers every single day on properties until I get my first rental property, because what that's gonna do is you're gonna making 21 offers a week on property. And so if you're making 21 offers a week on properties, you're gonna get one property by the end of the year, it's just doing that consistently. And making sure you're not missing days is extremely important. Now, if you have an execute daily plan, and you miss a day, guess what, you got to make a pact with yourself, you got to make a little bit of a rule here. And my personal rule is and I learned this from atomic habits, one of the best books for setting habits, no James clear the author of atomic habits, he talks about this, he says my personal rule is I just don't miss two days in a row. So if you miss one day, make sure you pick it back up the next day, because allowing more and more days to slip by is only going to allow you to just slip off and not be able to accomplish that goal, you're just going to let it go. So never missed two days in a row and executing daily is so important. Consistency is the most important thing and accomplishing anything. being consistent is so incredibly important. Especially when it comes to your money. Because if you're not consistent with your savings, if you're not consistent with increasing your income, then you're just going to tread water. Because you're going to get ahead, then you're going to fall behind, you're going to get ahead, then you're going to fall behind. So consistency is everything. If you want to build wealth, you may do it for two weeks. You may do it for three weeks, but can you do it for 20 3040 6090 weeks in a row. That is what matters. That's where you're gonna make progress. It's when you're in the trenches, and it feels like you're getting nowhere. That's when you pick yourself up and continuously pursue that goal because that is what's going to change your life is day in, day out when it's boring when you don't want to you do it anyway. And that's how you accomplish that goal. So executing daily is one of the most important things. But as you can see, this systematic planning process is going to allow you to accomplish your goal because you're breaking it down into small chunks. If you break it down into small chunks, then you can do that task every single day, then you're checking in with yourself quarterly, and making sure that you're on track. And doing this day in day out every single day, executing your plan is going to change your life forever. And then the sixth step is to adjust as needed. Just as we were stating, when you're when your quarterly check ins, if you're just not hitting your goal. If you're not hitting a goal, make make adjustments, roll with the punches, don't just try to keep going and know that you're going to fail, you have to make adjustments. So maybe you want to buy one rental property every single year, and you're making one offer a day. And you realize one offer a day is getting me nowhere, I'm six months in and I haven't got somebody who entertained by offer, then you need to ramp up your offers, you need to make three, four or five offers a day until you can get that property because consistently doing the same thing and expecting a different outcome is going to get you nowhere, you have to ensure that you're making adjustments. And there's nothing wrong with making adjustments. If you're doing your best. There's absolutely nothing wrong with making adjustments and only you know, if you're doing your best, but making those adjustments will change everything for you. And that's the system. That's how you put it together. So using those six steps, making sure that you accomplish those six steps, defining your three year vision, setting your one year goal, establishing your 90 day benchmark, creating a weekly battle plan and then executing every single day. And then finally making adjustments as needed. doing those six things is going to ensure that you can accomplish anything you ever wanted to do. But you have to make sure you execute those six steps. Now let's get into some awesome money goals that you can implement this year. So maybe you've heard this and you said, Hey, this is a great system, I want to implement some goals with my money with my personal finances. Well, I'm going to give you some some ideas on goals that you could set for yourself. That'll allow you to accomplish them to improve your finances throughout this year. And here's some of the best ones. If you're in debt, let's say you're in student loan debt, or in credit card debt, make an aggressive battle plan to be able to pay down that debt. Maybe you have $20,000 in student loan debt this year. What if you aggressively pay down that debt this year? How would you feel one year from now if your debt was just gone? poof, the debt is gone. Imagine the difference that you would feel next year. And this is the power of setting these goals. Because what happens is if you're executing every single day, by the end of next year, you're gonna change your life because getting rid of student loan debt or getting rid of credit card debt will absolutely change your life. Because now you have more money to put towards investments. Now you have more money to give away to people in need. Now you have more money to do with what you want in life, not giving it away to the bank. But you're keeping it for yourself to better your financial future that's gonna change your life forever. And making sure you put together this battle plan and executing every single day is what's going to allow that to happen. Another great goal to have is maybe you want to increase your savings rate. And here's what I love to tell people to do. If you're not saving as much money as you need to, then let's use the 1% rule. Now what's the 1% rule every single month, you're going to increase your savings rate by 1%. So by the end of the year, you're going to save 12% more than where you are right now. Because what you have to understand is what a lot of financial gurus will tell you is you just save 10% to be able to retire. Well 10% is going to absolutely get you nowhere. And if you haven't listened to the episode on how much money you need to save to retire, you need to listen to that episode, because that's one of the most important episodes on the personal finance podcast. Because what it's going to show you is a measly 10% is going to take you 40 something years to be able to retire. So increasing your savings rate. If you're only saving 510 15% most Americans are saving nothing by the way. So if you're not saving any money, or you're saving a measly 510 15%, like a lot of financial gurus will tell you to do that increasing your savings rate is a major priority getting rid of that debt is huge. But then increasing that savings rate is even bigger. Because increasing that savings rate is going to change everything for you. Especially if you're in your younger years, you don't know how important it is to save in your younger years compound interest is your best friend. And so doing this, increasing your savings rate by 1% allows you to make the adjustment as the month goes on. It's only 1% it's not a huge deal. If you make $5,000 a month, that's 50 bucks a month that you're increasing it. But what it's going to do is allow you to make that adjustment. And once you increase it 12% you can keep going on and on and on until you get to the savings rate that you need to get to. And during that time, you can work on your other goals as well like increasing your income because investing more money and increasing your income growing the gap between those two numbers is going to allow you to build true wealth. So increasing your income is going to allow you to save more money which is gonna allow you invest more money so that you can build your wealth and you can increase your savings right that's why it's so important to increase your income because it makes your life so much easier, especially with your personal finances. It's not to spend more money on get fancy cars or anything like that. It's the increase the amount of money that you're investing. So that you can accomplish financial freedom, you don't have to work anymore if you don't want to. And that's why we talk about increasing our income so much on this podcast. The fourth goal, that would be a great goal for you stick to a budget every single month, most people start a budget, and a lot of people will start budgets in January, February, March, like when the New Year rolls around, and they don't stick to it, they stick to it for a couple months, it gets too hard, and then they quit. But what you have to understand what the budget is, is the same thing as rolling with your goals, you have to roll with the punches, you're never going to have a perfect month ever in your entire life. Nobody ever does the best budgeters in the world, never have a perfect month ever, you have to understand that you have to roll with the punches, because what a lot of people do is they blow up their budget and they quit. And let me tell you, if I quit, every time I blew up my budget, I make mistakes all the time. If I quit every single time I did that, I would never be where I am today. And there's a massive difference between continuously pursuing your goal and giving up way too early. Just understanding that. So maybe your goal could be to stick to a budget every single month, this year, 12 months in a row and see where your money is at the end of the year. Because you're gonna be able to accomplish a lot of these other goals if you stick to that budget every single month. Now we've talked about the two ways to budget if you haven't listened to the budgeting episode, listen to that, because there's a very simple way to budget that I talked about in that episode. But understanding how to do it right is going to make it even easier and automating your finances is going to make it easy. So check out that episode if you want that to be your goal. And lastly, and this goes along the lines of increasing your income is maybe you want to start your side hustle, maybe you want to start your very first side business. Well, what's that going to be? What's that going to look like? What's that going to be surrounded with because what you want to do is diversify your income and diversifying your income is a major wealth building principle, I think everybody should have diverse sources of income, you should have multiple income streams to stack those income streams. That's what you need to be doing. And so maybe you only have one income stream, which is your job, and you want to start another income stream, well, this would be a great year to do it. And a lot of people are working from home, they have a little more time, which is going to allow them to increase their income by stacking those income streams. And we're gonna have a lot of episodes this year on side hustles. So stay tuned, because we can talk through some of these if you want to. And I've had a couple episodes like the one the cheapest ways to become a millionaire. That's a side hustle episode. And listen to those episodes, I'll give you more side hustle ideas than you ever need. But you just have to pick one and go after it, stack up that income stream, get it working first, then you can stack up another one. But pursuing that side hustle on having a three year goal, maybe you want to make an additional $5,000 a month that's very attainable in three years. So having that three year goal, saying by the end of this year, I want to be making at least $1,000 a month with my side hustle. That's where you make progress is day by day working on that side hustle week by week executing the plan, quarter by quarter checking in to make sure that you're on track every single year, getting one third of the way to your three year vision, and then accomplishing that goal in three years. This is how you systematically do it. This is how you systematically accomplish your goals. Because goals are for suckers and habits are for winners. So what you're really doing is forcing habits into your life by doing this system. And this is the way you can accomplish anything in your life. It doesn't matter what it is. Maybe it's around your hobbies, maybe it's fitness. Maybe it's your money, it doesn't matter what it is. Setting up systems so you can accomplish your goals will allow you to do anything you want in this life. Thank you guys so much for listening. And if this is your first time listening, consider subscribing so you never miss an episode and share this episode with a friend. And don't forget to leave a rating and review on iTunes as well because our goal is to bring as much value to you as possible. And we're trying to spread this message that money can buy freedom, that's what money is there to do is to buy more freedom. So thank you again so much for listening and I hope you have a great day.