The same thing can be said for planning for your future. There are many scenarios, both positive and negative, that your financial plan must cover. Anticipating the challenges you may encounter and determining the key steps to reach your goals are important elements in successful planning for your future. As the saying goes, “He who fails to plan is planning to fail.”These steps are key when planning for your future:
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1. Determine your end goals.
Identify what is most important to you and picture what you want your future to look like. Is it travel? An early retirement? Creating generational wealth? Write the goals down.
2. Review your assets and liabilities.Just like reviewing the skills of the players on a team, examining your current assets and liabilities and future ability to grow your assets gives you a good look at your current situation. Create a spreadsheet documenting it.
3. Understand your strengths and weaknesses.Determining the strengths and weaknesses of your team helps you evaluate the tools at your disposal. Don’t ask a natural defender to be a striker.The same can be said for planning your future. If you know you are a spender, accept it and plan for it. Celebrate your strengths and accept your weaknesses. Being honest with yourself allows you to accurately assess your resources.
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4. Develop a strategy for meeting your goals.
Successful people break down and document the steps and measurable sub-goals required to meet their end goals. Expecting players to act as a cohesive winning team from day one is not practical, but getting them to know their teammates’ names by the end of the first week is a realistic measurable sub-goal.Establishing a goal of retiring at 50 when you are 20 is hard to measure along the way. Breaking it up and establishing specific actions and measurable goals will lead to better success. Saying you will save $5,000 in 2024 by spending $600 per month less on dining out and clothing is measurable and is a step toward the end goal of retiring at 50.
5. Huddle with your team.
Coaching the players to rely on each other and to work as a team leads to wins. Creating a team of people to support you as you work toward your goals will lead to a more successful outcome. Let your friends know that you’re saving for retirement, so you are eating out less. Find a financial adviser who will make you accountable and help you create the steps and mini-goals that work toward your end goal.
6. Evaluate your actions.After every game, I would evaluate what worked and where changes needed to be made. The same must be done as you work toward your end goal. Each year, if not more often, review your action steps and mini-goals to see if changes need to be made.Perhaps saving $600 monthly by dining out less and buying less clothing isn’t realistic. Your goal may change, or an action step might change. For example, you might decide, “I still want to save $600 per month, but I need to buy a less expensive car or live in a less expensive house.”The game of life isn’t always easy. Make sure to appreciate each success along the way. Don’t be too hard on yourself when things do not go as planned. Be persistent, and continually evaluate and adjust your actions as needed. Achieving your goals is not a one-time event but a series of smaller, consistent actions.
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