Welcome back to 12 months to get good with money, a series of bite-sized steps to take over each of the 12 months of the year to get good with money slowly. Let’s recap the past few months:
In January, you made a budget.
In February, you made savings goals.
In March, you separated your savings accounts and learned about automation.
In April, you made a plan for your taxes.
In May, you learned the general concepts of investing and did research on the investing vehicles that are available to you.
In June, you created your investing plan.
In July, you made a plan to spend less and save more.
In August, you made a plan to earn more.
In September, you did an exercise to help align your spending with your values.
In October, you tried your hand at a no spend challenge.
In November, you made a game plan for the holidays.
I can’t believe that it’s the final month of 2021. If you’ve made it through all or most of our previous goals, you have a lot to be extremely proud of. In all likelihood, even if you just stuck to the first goal, you’re more on top of your money than the average person. And while I’m so happy to have been able to offer a bit of guidance, all of your accomplishments are entirely your own.
If you missed any of the previous videos, I suggest going back and at least watching them and making a plan to accomplish each goal in the coming year.
This month, we’re going to celebrate and look to the future. I wanted to dedicate this video to talking about setting audacious goals for yourself, and dreaming even bigger than you’ve allowed yourself to thus far.
Lots of people think I’m a pessimist, and like most pessimists, I think I’m a realist. What this usually translates to is that I struggle to allow myself to set big, scary, audacious goals. And I’m by no means unique in this way.
An example of this in my life was that, a few years ago, even when I was completely on top of my finances and deeply interested in the FIRE movement, I put off calculating my FI number and getting a loose FI date for myself. I think I used the typical way of thinking that says “well, I’m doing everything I can to get out of debt and have a high savings and investment rate, so I won’t change anything by looking at the numbers now.” Translation: “I’m afraid I won’t be happy with my FI date.” Or even worse, “I’m afraid I won’t be able to retire early at all.”
Of course, neither of these things turned out to be true. It took facing the numbers and making a plan for me to feel encouraged toward my goal, and now I have all the tools to make it happen AND I feel more motivated to make the right moves.
So, I want to ask in earnest: what big dreams have you been scared to face?
Is it getting your debt completely paid off?
Being able to pay out of pocket for your kids’ college education?
Reaching for financial independence or early retirement?
Switching school districts or changing careers entirely?
Going back to school for another degree?
Starting your own business?
Get really specific about what those goals are, and then clearly visualize what your life will look like when you reach them. Using the method of asking yourself “why” again and again is a great way to do this. Let’s go through an example together.
“I want to pay off all my debt”
“Because then I will feel free”
“Because I won’t owe anyone, and I can free up $500/month that I’m currently making in payments”
“Because with $500/month, I can greatly improve my life”
“Because I can start investing and spend some more money on myself”
“Because I can contribute $250/month to my retirement, and use $250 to travel budget”
“Because then I can feel more secure about my future and start taking the vacations I always dreamed of.”
Now, you’ve gotten to the real, specific outcome that comes from the more nebulous idea of “debt freedom.” If you’re in debt, do this exercise with your real numbers, and see how much more motivating it is than just wanting to “pay off all your debt.”
Once you’ve gotten to the real why behind your goals, you can start to get even bigger picture than that.
What would your life look like if you were debt free? Retired early? Your own boss? Your family taken care of? Get really specific about how you would actually spend your days, view the world, and allocate your money.
You’ve spent this past year working on your finances, so it’s time to give yourself permission to imagine your dream life. For me, it’s running Teachers Talk Money full time and continuing to coach volleyball on the side. It’s being able to travel for months at a time and really get to know the cities and cultures of the places I travel. That’s the overview, but I can get much more specific in my mind. I could tell you the schedule of how a typical day in my dream life would look, and exactly which places I want to visit. Get that level of focus on exactly what you want, and that will motivate you all the more to take the steps to get there.
If you haven’t already, get my free budget templates here.
If you need more guidance in your money journey, I created my Money Map Workbook just for you.