Too many of us are in survival mode as it relates to our finances. I hear so many people describing their desire to simply hold on to what they have or to “make ends meet.” That is exactly how I used to live. In fact I was even worse. I was paying last months bills with next week’s check and dodging bill collectors. One day I decided that I was not going to live that way for the rest of my life. I learned that I had to set some financial goals in order to develop a financial strategy.
Most of us will need help in establishing our financial goals. We all have dreams and there are financial implications attached to our dreams. But a goal is much more concrete than a dream. A goal is something that a reasonable plan can be executed to achieve. I can dream of buying a castle but when I have that as a goal, I better be able to explain to myself how I am going to do that. It helps to have a certified financial planner help us in developing our financial goals. But even before we solicit the help of professionals there are some things we can do for ourselves.
In my book dfree: Breaking Free from Financial Slavery I outline four steps to financial freedom. The first step is to Get Started. That means that it is important to stop dreaming and start planning; to stop talking and start taking action on our financial status. To begin there are two important tasks to undertake. First, keep a record of all of the money you spend in a 30 day period. At the end of those 30 days take a look at the list of expenditures and circle the ones that are not absolutely necessary for your survival. All of the items that will be circled represent money that can be used to help you reach your financial goals. Next obtain a copy of your credit report. Free copies of our credit reports can be obtained once a year from www.annualcreditreport.com. There are three main credit reporting agencies that contribute to your credit score. A free copy can be obtained at this website and your inquiry does not impact your credit score. I actually get my report from each of the three once a year but I get a report every four months from each of them. By staggering my requests I am able to keep up with what’s happening with my credit more frequently at no cost. Our credit reports not only reveal our credit scores and who we owe but they also reveal information about incidents of our credit having been checked by someone or even someone having used our names without our permission. Identity theft is a huge problem and our credit reports often give inform us about unauthorized attempts to use our personal information
Financial goals describe where we would like to be financially by a certain time. Obviously, the shorter the time, the smaller the goals. But financial goals are more than numbers. They also reflect our values. The purpose of money is that it be used for a purpose. Some purposes have more value than others. After we make sure our basic needs are covered, the way we use our money and the purposes for which we accumulate money reflect the kind of people we are and the kind of legacy we will leave. My grandmother was born in 1901 and when she died in 1981, she owned multiple homes that were all debt free. She left an inheritance for her children and her grandchildren My goal is to do at least as well as she did.
Tomorrow – Spiritual Goals