Wednesday, August 15, 2007

How to achieve your goals, priorities and dreams by defining them

Before we get started, let's get some definitions out of the way:


2 : the end toward which effort is directed : AIM


2 : a preferential rating; especially : one that allocates rights to goods and services usually in limited supply (that project has top priority)
3 : something given or meriting attention before competing alternatives


2 : an experience of waking life having the characteristics of a dream: as a : a visionary creation of the imagination : DAYDREAM b : a state of mind marked by abstraction or release from reality : REVERIE c : an object seen in a dreamlike state : VISION
3 : something notable for its beauty, excellence, or enjoyable quality
4 a : a strongly desired goal or purpose (a dream of becoming president) b : something that fully satisfies a wish : (IDEAL a meal that was a gourmet's dream)

Courtesy Merriam Webster

I've been thinking a lot about goals, priorities and dreams lately. Financial Dominance wrote last week about how it's important to define investment goals, and I completely agree with that. I've been wondering what the goals are for our own investments, I've been wondering about my own career goals, and I've been wondering how all of these things fit into my dreams. How can I define my goals, dreams, and priorities if I don't know what those things are? Where do I begin? Where does it all fit together?

It's really a little overwhelming. As I pondered on this, journaled about, agonized about it, and had a few panic attacks, I came up with a way to think about this that would make all the pieces fit together.

Dreams, the most overarching of the concerns, are also the hardest to define. They have to do with the perfect state, with how things would look if you had everything you wanted. The best way to figure out what your dreams are is to sit in a quiet room and see what you think of. Write, draw, or talk about what your life would be like if you were perfectly happy. This is your dream life, so you can have whatever you want, whether it's a Manhatten apartment or a country cottage, wealth and fame or peace and quiet. What would your perfect state look like?

Goals have to do with the end result, what you want to have in the end. These need to be defined and measurable. "Be rich" is not a goal. "Save $3 million by retirement" is a goal. What measurable end results do I want to see? I wrote down about three of these: "Pay off all debt." "Save $3 million in retirement funds." "Save 20,000 for a house down payment." These goals are pretty far out still, but they give me something to work toward. Your goals will be based on moving toward your dream, but will be realistic and concrete steps along the way.

As far as money is concerned, priorities have to do with how you would allocate something in limited supply (whether it be time or money). If I could do only one thing with money, what would it be? If I could do a second thing with money, what would it be? I took out a notepad and just started listing. My priorities had to do with what is important to me on a day to day basis (food, visiting family, etc) and with what I need to do to achieve my goals. I made this list longer than the amount of money I have each month; if I'm short on money, where can I stop? If I have extra money, where can I go forward to?

Once I've done this, I feel much calmer. I know that I'm making positive decisions with my money that will get me toward the perfect life for me, and I notice what I've been spending my time and money on that don't add value to my life.