Whether it's a new year, new month or new week, the most successful people in the world are always setting goals to improve themselves, their career and their lives. But why is it that some people continue to achieve their goals, while others continue to set the same resolutions year after year and never achieve them? Chances are, the ones that fail at setting goals are not being realistic and sticking to the goals they set themselves. When done properly, goal setting can help you achieve things that you never would have thought possible. When it comes to money and wealth building, having financial targets is a key factor in shaping your wealth trajectory.
But just how do you set goals to ensure you achieve them?
There are so many ways to set and measure goals, and a lot of it is up to personal choice and what works for you. However, the 3 main goal setting strategies are called the SMART system, BHAG goals and the OKR method. These three systems cover goal setting in the short, medium and long term. The system you choose is about deciding what will work best for your goals, lifestyle and thinking system. Everyone has a different thinking process and therefore will respond to different systems in different ways.
Let's have a look at what each of the goal systems entail!
SMART Goal Setting
This method is one of the most popular systems to help you achieve anything in life. This method is effective because it allows you to see results quickly, thereby encouraging you to continue setting goals and finding success in whatever avenue of life you choose.
SMART is an acronym that stands for:
Specific, Measurable, Achievable, Realistic and Timely.
Let’s go through each of the components of SMART goals and how you can implement them into your life:
Specific: One of the first parts of setting a proper goal is to be clear on what it is you want to achieve. In reference to building wealth, pick a certain number that you want to earn or achieve eg. ‘I want to earn $80,000 this year’. Knowing exactly what you want to achieve allows you to create a clear path to success. The more specific you are, the more likely you will achieve that goal.
Measurable: Tracking your progress is a huge component of ensuring that you are on the right track. If your goal isn’t measurable, then you are unable to see if you have actually achieved the intended goal. Making a measurable goal also allows you to be more specific with the goal you are setting in the first place.
Achievable: It is always fun to set a huge goal that feels so exciting and out of reach. But you will never reach these big goals if you don’t set small and achievable goals for you in the short term. Setting small goals is more effective as all of these goals compound over time to reach the bigger goal that you see for yourself in the future. Making achievable targets also encourages you once you achieve them. That being said, we always encourage you to make your goal achievable but stretch it a little bit to make it exciting and think of new ways of achieving them. This helps open new doors and ways of thinking. Being
Realistic: Realistic goals are those that are within reach of your current capability and where you currently are in life. What is it that you need to do to make your money goals a reality? What do you need to do to reach your fitness goals? How are you going to get that next career goal? By making targets that are within your current capability, you are taking steps towards your big goals at your current level. Taking the steps today does so much more than trying to make big leaps in 6 months time. The secret of your success is hidden in what you do every day. So, by making small and realistic goals that can be achieved today, you are already achieving the big goals you dream of.
Timely: The final SMART goal rule is setting a clear time frame in which you can achieve your goal. Setting a timeframe gives you more accountability, meaning that you have to complete that goal sooner. Without setting a specific timeframe, it can be very easy to push the goal back to a later date, eventually leading you to never reach the intended outcome. Having a clear time frame also allows you to check your progress along the way, giving you more motivation and satisfaction that you are getting closer to where you want to be in life. Whatever your goal is, it needs to have an end point. Goals without an end point will never happen.
When reassessing and measuring the goals you have set previously, how did you do with them? Did you have a strategy, and did you hit them or fall short?
We like to reassess our goals on a regular basis: Generally, we reassess our short term goals on a quarterly basis and the long term ones on a yearly basis. If you don’t reach your goal within a certain time frame, go back and reassess the goal: did your goal meet all of the SMART criteria? Was it realistic and achievable to start with, or was your time frame too short?
If you have hit your goal, it’s time to celebrate!
Celebrating hitting your goals and milestones is so important in recognising all the hard work that you have done to reach that goal. Celebrating also excites you and encourages you to set new bolder goals. And when you have a certain reward for completing an objective, you will be more excited to push yourself and hustle to achieve the next goal!
BHAG Goal Setting
Another method to use when setting goals is creating a BHAG goal. According to the book ‘Built to Last: Successful Habits of Visionary Companies’, the BHAG goal stands for a Big, Hairy and Audacious Goal. These targets are long term (10-25 years) that gets you out of thinking too small, and gets you to look at the big picture. Setting such crazy goals allows you to reflect your life trajectory to your core goals, giving you direction and guidance. These goals, although big and exciting, need to fit within the SMART goal system.
OKR Goal Setting
Used by companies like Google and IBM, this method of goal setting is based on the Objectives you want to accomplish and the key Results/metrics that must be achieved to reach the Objective. Objectives are the things you want to achieve, and Key Results are the numbers you must hit to achieve the Objectives. These goals are written for short term objectives (ie. quarterly goals).
The difference between SMART Goals and OKR Goals is that you actually aim to FAIL most of the OKR Goals- around 60%-70% of them! Sounds crazy, but this is done on purpose to stretch you to accomplish the most you can, even if you don’t fully attain the goal. Personally, we use SMART goals as we like the reward and encouragement from constantly hitting our goals, but use OKR goals for goals in a 3 year timeframe
We go into how to properly set OKR Goals to make them work for you in our Money Mindset course!
So, now that you know the systems of setting goals, it is time to reassess your goals and start to plan effective short, medium and long term goals to build your dream life! The goal setting process is a vital part of your wealth journey and long term success. The only way to achieve your goals is to make a plan around what you want, why you want it and how you are going to get there.
The first step is simply starting!
If you enjoyed this blog and want to learn about money skills and the wealth mindset then check out our series of great courses on this link!
TRY OUR 3 ONLINE COURSES👇🏻⠀
These 3 courses are broken up into:
"The Fundamentals of Wealth" ( 8 week course )
" The Wealth Mindset " ( 4 week course )
"Your money plan in 30 days" (4 week course)
Also you can try out our free mini course here!
THE 6 MONEY SKILLS YOUNG PEOPLE NEED TO LEARN TO TAKE CONTROL OF THEIR LIFE
We look forward to seeing you there! 🙌
Remember:
Keep Learning
Keep Growing
Be wealthy! 👊