Have you noticed how many people wear fitness trackers? Seeing a Fitbit around someone’s wrist is now a common sight. I’ve tracked my daily step count, sleep patterns and even my heart rate for a couple of years now and I’d like to think that I’m healthier and more in tune with my physical condition because of this.
For those of you who wear these you’ll know the default target for most fitness trackers is 10,000 steps per day (roughly 5 miles). I remember the shock I felt the first time I realised I was expected to take 10,000 steps each day. However, within a week or two I was regularly hitting this goal. Fast forward a couple of years and I still feel a sense of accomplishment when my tracker buzzes to inform me that I have hit my daily target.
I believe the principles in setting health and wellbeing goals can be applied to your personal financial health. Here’s how:
1. Set personal goals. It may seem an obvious place to start but ask yourself when you last set a goal that involved your personal finances. It may be something simple like saving more each month or it could be a longer-term goal like deciding you want to retire 5 years early.
2. Assess where you are now. Do you know how much you spend each month? I often find when I’m putting together Financial Plans for people that they have no grasp over their monthly expenditure and most people substantially underestimate their outgoings. If your goal focuses on retirement it is vital that you understand what pension plans you have, how much is going into them and how they are performing.
3. Design a strategy for achieving your goals. What are you going to do and what changes need to be made? Just as I had to adapt my lifestyle to meet my daily step goal for example taking the stairs and not the lift you will have to adapt your spending and saving habits to achieve your goals.
4. Regularly track your progress. If your goal is short term you will need to track your progress more often. If it is a longer-term goal then you can afford to do this less often. For example, a retirement goal should be checked at least once a year. A short-term savings goal (a holiday, new car etc) should be tracked once every couple of months.
5. Be consistent and deliberate. Achieving goals, particularly financial goals does not happen by accident.
If you want to take control over your finances and set goals why not get in touch? Our role as Financial Planners is to help you to identify and focus on your goals, and then to work with you to create a Plan for achieving them. We would be delighted to speak with you.