Does the thought of setting goals fill you with anxiety or leave you feeling a sense of dread? Our goals should inspire and motivate us, but the unfortunate fact is that past failures can haunt us. Often, the root of the problem is that we’ve been setting the wrong kinds of goals, which is why I want to share the concept of “compass goals” today. It’s an approach you can use to make progress toward your financial goals, but it’s useful in every other area of life, too.
What Are Compass Goals?
Most traditional goal-setting focuses on an end result. In terms of financial goals, examples include paying off debt by a certain date or saving a certain amount of money for a down payment on your dream home. When framed in this way, many people feel like they’re constantly grasping for something that feels far out of reach. When you’re in that mindset, it’s also easy to feel unhappy with your present circumstances.
By contrast, compass goals are meant to add more meaning and joy to the present. They might have end goals attached to them, too, but there is less focus on that aspect. With compass goals, it’s less about the destination and more about creating a fulfilling journey.
While I believe that traditional goals have their place in helping us achieve important benchmarks in meaningful areas of our lives, including finance, I also believe that compass goals can lead us toward growth and fulfillment.
SEE ALSO: How to Grow Your Financial Confidence in the New Year
Four Steps to Setting Compass Goals
It can be difficult to switch your mindset away from setting goals that have you constantly reaching for a particular end result. Use these four steps to alter your goal-setting strategy so you can set compass goals and find more joy in the process:
Step One
Consider an aspiration you’re excited about working toward, even if it’s difficult. Ask yourself whether you can envision rewards along the way that will be successes in and of themselves.
Example: Greater financial freedom and less financial stress
Step Two
Think of a series of daily or weekly actions that will impact you positively in the present, while also moving you toward the larger goal.
Example: Using a budget, divert some non-essential spending into an investment account
Step Three
Develop a way to measure your progress without creating anxiety for yourself.
Example: Are you curbing your overspending impulses? Is your nest egg growing, even if incrementally?
Step Four
Think about how you anticipate the journey toward the goal adding value, growth, or meaning to your life – even if you don’t end up exactly where you initially envisioned.
Example: Fewer money worries, better spending habits, fewer nonessentials cluttering your home
Step Five
Develop a written “map” to reach your compass goal destination:
· Assign it a category that reminds you of the high-level direction your compass is pointing
· Write out your “why”
· List one to three actions that will impact your present and help you move toward the larger goal
· Decide how you’ll track your progress
Example:
· Category: Financial Freedom
· My Why: To feel less stressed about money
· Actions: Create and stick to a budget, cancel gray charges on my credit card, brew coffee at home and invest the money I usually spend at the drive-thru
· Tracking: Progress means not overspending my budget each month and watching my investment account contributions grow
It can take a little practice to set goals in this way, but once you get the hang of compass goals, they’ll come to you more naturally. If you find yourself starting the process for a goal and not feeling like the journey will be enjoyable or valuable, reevaluate – this is probably not a true compass goal for you!
SEE ALSO: Are You Practicing Values-Based Financial Planning?
Relieve the Pressure Around Goal Setting – And Accomplish More
Can you see how setting compass goals can relieve the pressure that we sometimes feel about traditional goal setting? It’s a bit of a paradox, but when we’re able to let go of our attachment to a particular end result, we free ourselves to move forward with less stress and anxiety – which often means we’ll accomplish more!
Setting compass goals is also beneficial because it’s a good reminder that life really is all about the journey. Even if you do achieve all the end results you had in mind, you aren’t “done.” You haven’t “made it.” There will always be more growth possible in each area of our lives, so if you do achieve a goal, it’s simply time to reevaluate where you’re headed next and set another.
Would You Like Professional Guidance Setting Your Financial Compass Goals?
Personal finance is an area where many people want to make progress, but sometimes obstacles intervene and we need a helping hand to get back on track and move forward. If you aren’t yet working with a financial advisor, we’re here to help! At Flourish, we help our clients get clarity on their values, set goals for their financial futures, and map out savvy strategies. We view financial planning as life planning because we know that money affects every other area of life, too.
If you’d like to learn more, please schedule a conversation with us today. We look forward to hearing from you!
