Broker Check
Two Things it Takes to Work Toward Your Financial Goals

Two Things it Takes to Work Toward Your Financial Goals

March 15, 2019

Many of us go through life without financial goals…other than to make sure we can pay our bills every month. Some set goals but do not take consistent steps to pursue them. Still others set goals, develop and take action steps to pursue them and revisit those goals on a regular basis. Wonder who has a better chance of achieving their goals?

No question – the last group.

So why is it so difficult for most people to have financial success? Two things: “the math” and “mental discipline.” These are the two things you need in order to work toward your financial goals. Notice I didn’t say you needed fancy financial products; I didn’t say you needed to make tons of money; I didn’t say you needed a cool retirement plan at work; and I didn’t say you needed a predictable and strong stock market. Because those things aren’t as important as the two things.

Before I apply the two things to your financial world, let’s apply them to something that many of us deal with every day – our weight. In order to have success with our weight goals, we need to understand “the math.” First, based on our activity level, we need to know the number of calories that our bodies need to maintain our desired weight. Then we simply need to eat that number of calories each day. Alternatively, we can create a combination of eating and exercise that equals the target number of calories. Calories in minus calories out equals weight loss or gain. Simple enough, right?  

So, if “the math” is so easy, why is achieving weight goals so hard? It’s the “mental discipline” that’s the hard part. There are so many things that want to pull us away from our weight goals. Great tasting food, eating out with friends, drinks after work, fast food because we are so busy, need for comfort, etc. In order to harness your “mental discipline,” you need to tap into and own what is driving your goal. Do you have a health issue that can be improved by losing weight? Are you trying to maintain a healthy lifestyle so that your future health is better? Would you like to fit into clothes that are hanging in your closet? Do you need to gain or lose weight to improve performance in a sport? Once you know your why for a goal, you need to remain hyper focused on it – to motivate you to stay concentrated on the math.

So, how about your financial goals? Like weight goals, financial goals can also be quantified and turned into math equations. You need to understand “the math” in order to know the action steps to take in order to pursue your financial goals. For example, how much do you need to save for retirement? What mix of investments will help you work toward your goals? How much life insurance do you need? How much can you spend during retirement? How can you maximize taxes with charitable giving? How much you can afford to give to your grandchildren, and so on. Your financial goals should be SMART: Specific, Measurable, Attainable, Relevant and Time-bound. Math applies to each component.

I imagine many of you are developing stress over this right now. A lot of you didn’t like math in school and probably still don’t like it. The reality is, to seek financial success, you need to understand “the math” around your goals. Otherwise, you can’t develop the proper action steps. At Second Half Strategies, we help you understand “the math” during our Planning process.

Once you understand “the math,” you need to apply the “mental discipline.” What is driving your goals? A desire to lower your financial stress? Wanting to take care of those whom you love? Hoping that you don’t have to work forever so that you can tick off items on your bucket list? Needing time to spend with family and friends? Whatever the why, tap into it because that’s what is going to motivate you to stay on track, to stay concentrated on “the math.” At Second Half Strategies, we know this is the hardest part; that’s why our process is designed to help you understand your why, to help you stay on track – because we know that you will need to maintain your “mental discipline” for many years in order to work toward your financial goals.

Some of you will be able to implement the two things all by yourself. Some won’t. There is nothing wrong with asking for help. Isn’t it better to seek help and potentially increase the probability of success as opposed to not seeking help and potentially failing to achieve your goals?

Just like weight success, financial success is not easy. And, unfortunately many people will not achieve it. Instead of focusing on the “two things,” they will focus on the wrong things or simply not focus on anything at all because, well, it’s just too hard. And, well it might be. But, it’s not impossible. You can do it. Simply by reorienting your brain to focus on “the math” and “mental discipline.” Both are required. Both are necessary. Both are equally as important. The financial services industry wants to make it seem harder than that, but it’s not. Don’t let them sway you. You too can seek financial success!

How are you leveraging “the math” and “mental discipline” to have success in your Second Half?

No strategy assures success or protects against loss, Investing involves risk including loss of principal.