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If you were able to see my previous post about budgets then you would have seen this first step of setting up a budget or as I like calling it by the true name “Spending Plan”. I wanted to go into this step a little bit deeper so hope you enjoy.

Step 1:

What are your goals? If you don’t know what you want to accomplish, it will be hard to make any accomplishments and know when you are successful of them. Also I like to use this analogy, “If you get into a car, you usually know where you are going to end up. If you don’t, well……either you are stuck in park or going to run out of gas.”

This step is truly the most important because when you are building a house, you definitely need a good solid foundation. With out a solid foundation, your house will crumble or will not be sturdy enough to build on. Need to make your financial house sturdy to build on so we start with goals. Going back to the car analogy, if you didn’t have a goal of where you were headed…..then you would be driving around and might run out of gas. With a goal or set destination, even if you get off your path, at least you know that destination you want to arrive at and might have to find a different path. You might ask, “Why do I need this, I am doing a spending plan?” Good question and glad you asked. Start by setting those goals that you are truly passionate about; saving money to {input what ever you are wanting to do with money}; traveling; stop working at age 55; putting my kid through college. These are just some examples, but YOU are the only person to know what is a truly passionate goal for YOU.

Here are some examples of goals and what to do:

Examples of goals categories: Life, Job, Spiritual, Health, Family, Financial, Education….etc.

Now, under each goal catagory make sure to set what the long term goal will be and several short term goals it will take in order to get there. Reason for this is if you wanted to retire by age 55……well that might be a long time away and you might lose sight of that goal. What you want to do is set up a few short term goals like having a certain amount of money put aside by a certain age. These will act like gas stations along the way of your journey to meet your end goal and a chance you can check your map and make sure you are going in the right direction.

WRITE YOUR GOALS DOWN ON PAPER, and if you are brave enough…….TELL SOMEONE about them. *WARNING* beware if you do this, you might actually accomplish your goals.

Why this works is because if you write it down the goals will be staring back at you from that piece of paper. If you tell someone, well, every time you see that person they will ask you how you are coming along on your goal. Most people want to show progress so either they will have done something towards their goal……….or they will run away from that person they told.

Hope this helps