Imagine if a morbidly overweight person resolves to be size zero in no time, how impractical his aspiration is. Nothing can be achieved overnight. Be it ideal weight loss or financial stability, perseverance is the key. So, this New Year, if we have resolutions that concern our finances, there’s no better time than to start now. In fact we may defer our other goals but if we are lazy with our finances, we won’t have the chance to be lazy when our body will actually demand leisure. To avoid such conflict with the self, to avoid situations that would press us to make financial compromises, here are some of the tried and tested tricks of the trade.
Draw a timeline
As years pass on, priorities of our lives change. ArthaYantra requirements take new shape; our expectations get better from before as reality continues to refine them. So if our resolution is to prosper financially, drawing a timeline for our goals is necessary. We know that to build a mansion, the foundation has to be constructed. Detailing our goals will help simplify the execution. We’ll not be stuck at the end moment, confused, not knowing what to do. For example, one may start with an immediate goal like buying a car, to buying a home, and then other long term goals. If you have a confidant, you can always seek help.
Don’t set high expectations
“Aim for the stars and you can reach the sky.” Really, this is motivating indeed. But when it comes to our hard earned money, we can’t take any chance and we must be as practical, specific and realistic with our goals. Imagine the feeling when one has aimed for a holiday in Paris and but ends up in Patna. Well, on a serious note, our expectations should always match our current cash flows instead of our future income. Setting the right expectations will reduce financial stress, and avoid wear and tear of our emotional selves.
Put a rank to the need
Prioritizing our goals is an easy way to achieve our goals. It will be too much to expect too many goals fulfill at the same time. For example, one may want to retire early but cannot save for it as the immediate requirement is a car. Here if car is for reasons of status quo, or health reasons will determine whether to prioritize buying of a car over retirement goal or not. We have a tendency to fall for instant gratification and compromise our future goals for it. But if right priorities are set before hand, it would be easier for a person to understand where they stand and how possible it is to achieve their financial goals.
“Rome wasn’t built in a day.” Once the seeds are sown, the wait is for years for the tree to grow and withstand bad weather. It is the same thing with our savings. When we invest, we must have the strength to resist quick returns. It is true that markets are volatile but eventually one can earn wealth only when he/she has passed these uncertainties. For example, if you have invested in large cap funds, it won’t be ideal to suddenly withdraw it than to stay with the fund till it gives the expected returns.
Self-realization is the key
Things that often stop us from reaching our goals are fear of losing and other biases. Our ego can also prove detrimental to our goal realization if we are do not trust enough. Placing trust on the wrong plate may fail us for once, but ego will forever hold us back from gaining riches. We need a lot more self-realization by way of research to ensure we trust the right service, the right product and people who can competently advise on fulfilling our personal financial goals.