We all have goals and things we want to achieve in our lifetime. But wishful thinking alone won’t get you there. Taking control of your finances and making a plan for your money is the best way to ensure you achieve your dreams. Goals give you a reason to take charge of your money. With the end in mind, you can create a roadmap to achieve your life goals.
But, are you one of the 92% of people that struggle to stay on track with achieving your life goals?
It’s time to get in control of your money. In this blog you will learn:
- How you can become one of the successful 8% who always manage to accomplish everything they want.
- How your past is preventing you from reaching your life goals, and how to turn this to your advantage
- How to avoid making this mistake, that many do when trying to save money.
- 3 key hacks for changing your life financially, forever.
The top 8% and how you can join them
Do you want to be part of the 8% of people that actually achieve their goals?
There may be many reasons why people end up giving up on their goals. Some of the common ones are:
- Picking the wrong goal
- Goals are too vague or not motivating
- Lack of a clear plan
- Setting the bar too high and feel overwhelmed
- Lacking guidance and support
- Can’t handle failure.
But there are some simple tips that can help you achieve your goals, making your dreams come true, and they don’t cost a lot of time or effort.
To ensure you are in the possible position to put yourself in the top 8%, start by setting SMART(ER) goals.
The SMART technique ensures your goals are Specific, Measurable, Achievable Relevant and Time-bound, and that you have a process in place to regularly Evaluate and Review them. For more information on SMART(ER) goals, and how to set them, check out this recent blog.
Now you’ve established your SMART(ER) goals, you’re ahead of 92% of the rest of the world. It’s time to deal with the skeletons in your closet that might also be holding you back.
Why your past is preventing you from your goals, and how to turn this to your advantage
Your mindset, or pre-determined beliefs about money, can greatly impact whether you succeed or fail financially.
If you’ve suffered from previous financial mistakes, they are more than likely front and centre of your mind, affecting your mindset and yes, these thoughts are preventing you from moving forward, holding you back.
It’s time to forget about the past, you can’t go back and change things, the best you can do is use that hurt to your advantage, learn from your mistakes and hack the most powerful tool available to mankind. An unshakeable Y.
Your Y is everything. Our brains are wired to be driven approximately 80% by pain and 20% by pleasure. Establishing the right Y, by tapping into this instinctual pain/pleasure relationship we all have, is the secret tool for changing our mindsets towards money and achieving our goals.
Find out more about how to create an unshakeable Y here.
If you’re able to learn from your previous mistakes and create an unshakeable Y, you have an advantage over everyone else, putting you in front of the pack. You can now you can focus 100% on achieving your goals. Well done you.
Now we have changed the mindset, and have our past working for us, and not against us, let’s make one last tweak, before we get into the 3 key hacks that will change your life.
Don’t make this mistake that many do when trying to save money
Saving money isn’t sexy. If it was, wouldn’t everyone be doing it?
Some people are natural savers, but most are impulsive spenders. Instead of denying that you’re an impulsive spender, embrace it.
Don’t try to save 60 to 70% of your income if this means you’ll live a miserable life. Saving money isn’t a race but a marathon. You’re saving for retirement and for large purchases.
If you’re currently having a hard time saving, start spending more money on nice things. This may sound counter-intuitive but hear me out, let’s use Kelly as our example to demonstrate my point.
Kelly was keen to buy a house, but knew she had to be better at saving money if she was ever to have enough money for a deposit. She eagerly started 2021 with a financial plan in place to save $250 each and every week of the year. By the end of 2021 she planned to have saved $13,000 and be well on the way to purchasing her first home.
The first Friday came along, her pay cleared, and she put the $250 aside. She was very proud of herself, her friends had invited her to a concert, but she had a plan, and she showed great discipline.
Week 2, again Kelly managed another $250. Her friends were going out for drink on the Saturday, but she was focused.
Week 3, Kelly was battling with temptation here. She hadn’t been out with her friends since New Year’s Eve, but she was determined to save for that deposit on a house. This was her year.
Week 4 came a long, and it was Australia Day weekend. Kelly hadn’t seen her friends all month, and she said stuff it I’m going out. She woke up the next day with a hangover and regrets, having blown her $250 for the week. Unfortunately, feeling like a failure for not making it past 3 weeks, Kelly gave up completely. She only managed to save $750 of the $13,000 she had planned to save for 2021.
Meanwhile Kelly’s workmate Lynda, whom Kelly had made a pact with to save money in 2021, had, although on a similar income to Kelly, made a far more realistic plan to save $100 a week. This meant, that whilst Lynda did have to make some changes to her lifestyle, she still had enough spare cash to do most of what she enjoyed, rewarding herself for those small sacrifices she did make.
As a result, each and every week Lynda managed to consistently save $100.
At the end of 2021 Lynda had saved $5,200, while Kelly only managed $750.
Slow and steady won the race.
Most people run into trouble because they create unrealistic and unachievable spending plans that simply set them up for failure. This system won’t work for those who are naturally frugal, but chances are they don’t need help saving their money. This system is for those who can’t save money and need to be rewarded for their hard work.
Everyone is different, but whether you’re just starting out, or you have a financial plan that’s already in play, and you’re making contributions towards achieving, there are certain tips and tricks that are certainly worth knowing.
Below we will cover a few hacks on how to make the game winnable and speed up your progress that will take years off of the time it takes to achieve your goals.
The most important lesson we all know, but few people really act upon, is that you must become an investor – making your money work for you. If you go through life relying only on your pay cheque, you are simply surviving, not thriving.
Here are 3 core strategies that you can begin to implement immediately that can accelerate your progress. Any one of them can significantly speed up the tempo with which you achieve your dreams. Put a couple of them together, and you’ll be unstoppable.
1. SAVE MORE, AND INVEST THE DIFFERENCE
Easier said than done, right?
For those of you who may be saying, “I can’t even make ends meet, there’s no way I can save more.”
Learn all about our client, who managed to save $228,000 in interest repayments over the lifetime of her mortgage here.
There are many ways to save money, from eliminating one of the single largest expenses of your life by paying off your mortgage faster, to cutting back on your latte addiction. Brainstorm the recurring expenditures that you could eliminate or reduce to cut your expenses. It’s not about depriving yourself, it’s about timing. By taking advantage of the unparalleled power of compounding interest now, you can ensure you have more than enough when you need it most (learn all about this life changing tool in coming weeks).
2. EARN MORE, AND INVEST THE DIFFERENCE
The second – and even faster – way to speed up your plan is to earn more and invest the difference.
Your earning potential literally has no limits – if you unleash your creativity and focus and become obsessed with finding a way to do more for others than anyone else. There is a biblical tenet that if you wish to become great, learn to become the servant of many. If you can find a way to serve many people, you can earn more. It’s the law of added value. That’s the key. Work out how you can add value and get on with it.
The side-hustle. Think of your side-hustle as a part-time job doing something you enjoy. You can sell items on eBay for a profit, or design websites for small businesses. Building a side-hustle will be one the hardest things you’ll do but be too stubborn to quit.
During the early stages, you won’t be making money and that’s okay. Since your day job already provides a source of income, you shouldn’t be dependent on your side-hustle to pay for your expenses. But, depending on how much time you invest in your side-hustle, it may one day replace your current income.
Even better, find a way to earn passive income. Passive income is when you earn extra money without extra work. Examples include income from rental properties, dividends from shares and other investments.
Whatever route you take, focus more on earning and save as much as possible. You have more control than you give yourself credit for.
3. ITS NOT WHAT YOU EARN, BUT WHAT YOU KEEP (AND INVEST THE DIFFERENCE)
“Australia has the second-highest tax slug on personal income and business profits combined out of 34 of the world’s leading economies”- Australian Financial Review
Tax efficiency is one of the most direct pathways to shorten the time it takes to get from where you are now to where you want to be financially. Look for legal, ethical ways to lower your tax bill, and do your best to make use of government initiatives that allow you to build your nest egg in a tax-free environment. Be sure to sit down with a tax expert to learn how to be most tax efficient with your investments. If you don’t have a tax expert, we recommend you do. If you need one, get in touch here and we can help you out.
Are you paying the lazy tax? Mortgage rates have dropped to historically low levels, but few Aussies have taken advantage of this, and instead continue to pay a higher interest rate than necessary. Dependent on how much you have left to pay and your current interest rate, you could be missing out on savings of about $200,000 over the life of your mortgage!
Don’t put up with overpaying, it’s time to call a mortgage broker to find out if your current mortgage is still the best product for your circumstances and if they can negotiate a better deal for you.
Hopefully, these tips help you reach your goals faster. If you want any help with your financial situation, get in touch here.
Other blogs you might be interested in:
Have you created SMART(ER) plans for 2021?
Note: The information in this article is general in nature as it has been prepared without taking account of your objectives, financial situation or needs.