Q: This is the time of year I start thinking about what I want in 2023. I started trying to come up with some goals for my financial life and I got stuck. I’m so frustrated because this happens every year. I feel so unorganized when it comes to my families’ finances. Where do we even get started?
A: Planning for 2023 is a great way to finish 2022. We have lots of clients who do financial goal planning. If you feel like you don’t know where to start, just start with one thing you want to do next year. Maybe that is to save more or look at your 401K more regularly. You can even go more extreme and say you want to plan for a trip to Bali or buy that new car you have been eyeing.
How can going on a vacation or buying a new toy be a financial goal? Well, it is! When you have a bucket list goal set for the yea, just the act of putting the goal out there and putting decisive actio in place can put you more in control of your money.
Let’s say Bali is your goal. First start with your why?
Why do you want to go?
Because I’ve always wanted to go.
Because I really need a vacation.
Because I deserve to take some time off and want to be as far away as possible and just disconnect.
There you go. Really go deep on your why. It will motivate you through the difficult times.
Then list out what you want to do in Bali with lots of detail. Picture what that looks like in your mind. How do you feel there? How will you look? Research hotels online (not the price yet). View pictures. Really imagine yourself there and the feeling you will have. The images need to be strong so that you can come back to them, and the feelings associated with them.
Now let’s look at the price and dates. How much is it? Hotel? Airfare? Will you want to do adventures while you are there? Do you need extra cash for extras? Look up the price of those too. Now, let’s say that adds up to $20,000. Wow! That is a big number. Stay positive. It’s just a number.
Lastly, let’s back into the date you need to book and pay by. Let’s say you want to book it 5 months before the actual trip. To avoid stress, you need to have the money ready to go. Let’s say that gives you 7 months to save. That means saving $2900/mo. Is that doable? If not, maybe we push the date out a bit. We are flexible. It’s about hitting the goal itself. The timeline eventually needs to be set but shouldn’t be a dealbreaker.
Obstacles and challenges will come your way. There will be months you don’t hit your savings goal. There will be times you will become unfocused and don’t understand why you are doing this to yourself. Saving 20K is hard! However, putting together a plan should be fun but thought out. Tell yourself this is supposed to be fun. Stop being so serious. It won’t be perfect, but the goal will be achieved and that is what is most important.
Once you reach your goal of paying for your trip to Bali with no financial stress and dread, you will want to do it again. It’s an amazing feeling. It’s addictive, I’m warning you!
This step-by-step process can use this for any of your goals, saving more, saving for a home, buying life insurance, looking at your budget, figure out how you look for retirement. They all start with the:
1.) Why and going deep on your why
2.) Imagine and feel what that looks like. Images you can return to easier during the roadblocks.
3.) Write out an action plan and begin. **
**Don’t be afraid to start small. Baby steps are a perfect place to start. A baby first steps are amazing! They start from nothing to walking. What an incredible accomplishment! Then the baby begins to take larger and larger strides. That can be you but you have to start.
Lastly, be kind to yourself and don’t let yourself down. We have a client who said she always failed on saving more. She said every year she would do it but always fell off the wagon. She wanted to break the habit. We started with a why, imagery, emotions, and baby steps. She has quadrupled her monthly savings in just two years. She said every time she felt like she was failing, she went back to that feeling of winning and she called us to rework the plan or talk it through.
2023 can be a spectacular year. Taking some time to think about what you really want can make all the difference.