Three tips to get started on a better financial journey

Published on: July 15, 2019

Written by:

Adam Faulkner

Three tips to get started on a better financial journey

Thinking about money, or, more specifically, how we can be better at managing it, is something that is pretty familiar to most of us. What is hard, however, is knowing how to start the journey. Like all journeys, that first step is often met with some resistance, as it often means we need to modify behaviour or reset a way of thinking. 

Here are my top three tips to get started onthe journey to a better financial future:

1. Have a clear objective

My first tip might sound like an obvious one, but it’s where many people fail. In my experience, it pays to be incredibly clear on your goals and objectives.

Being clear on your goal means you not only have it in mind, but you also understand what it will take to achieve it. You need to have a clear path in your planning to make sure you truly understand what it is you’re going to do and the steps that will get you there. It’s often worth identifying the pitfalls that may hamper you on the way; being prepared to meet them makes you more likely to overcome them.

You should alsostrongly consider how passionate you are about this objective:it needs to resonate with you, to really mean something to you. That passion and drive will be incredibly helpful along the journey because, at some point, you will face tough choices around what to do with your money. Having a goal that has meaning will make you more likely to stick with it, even when faced with a challenge.

2. Understand your beliefs and behaviours

I’ve written before about how beliefs and behaviours drive our financial decision-making. It’s very true that our behaviours can dictate whether we are successful in reaching our financial goals: For me, it is the most important factor.

Understanding these behaviours upfront and what impact they will have on your journey is a crucial step. A good financial strategy will not only identify these behaviours but will help you understand which ones you need to change to make your goal a reality. It can help you avoid those bigger ‘leakages’ in your finances that make your goal seem too difficult or unrealistic.

When it comes to your behaviours, it’s also critical that you are prepared to change because you’re going to have to make some modifications along the way.

3. Be realistic to avoid setting yourself up for failure

This one is a really important factor to consider: Be realistic in your goals.

While we’d all like to be billionaires tomorrow or live our lives on an exotic island without ever having to work again, for the majority of us that is not going to be a realistic outcome. Make sure your objectives and goals are achievable; by all means, stretch yourself and be ambitious but curb your enthusiasm from making it something unattainable, at least for now.

It’s also worth taking the approach of breaking yourgoals down into smaller, manageable parts. For example, think about improving your fitness. It’s a goal that many of us have at some point, and a large number of us fail to achieve, as keeping a regular routine and making time for exercise means you have to change your behaviour. It’s not uncommon for people to jump headfirst into a demanding gym schedule, quickly find it impossible to maintain, and give up. It often works better to make the first objective smaller; for example, getting used to waking up earlier first, changing that habit to give yourself time to exercise before work, and then increasing the intensity over time. The same is true with your financial goals too. 

Remember: Small steps can make a big difference to your overall financial journey.

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