One interesting debate in the personal productivity space centers around setting goals, and the effectiveness of the concept.
For years, we’ve assumed that exceptional success in our lives depended on well-constructed and properly executed goals. An entire industry grew around goal-setting, with everything from books and speaking to personal coaching services.
But a quiet revolt is taking place. “Thought leaders” like Leo Babauta are saying no to goals as a requirement for success. Others, like Seth Godin, tell us to focus on “shipping” things out the door.
The focus is shifting to past achievements and relying more on intuition to guide the way. A lot of driven people who want to do more, or do better are rightfully confused about what approach to take.
Goals and Money
When applied to personal finance, goal setting has some unique characteristics.
The fact that we’re working with numbers lends itself very well to setting SMART goals (remember—Specific, Measurable…). In fact, it’s hard not to set a money goal that has a hard number and a date attached to it, with a clear way to measure progress.
But money can also be a wild card. For example, if you’re trying to lose weight, you can control exactly what you eat and when (how easy that is to do is another question). But you can’t always control what expenses come up. Emergencies have a way of sneaking up on you and throwing the best-laid plans out the window.
With these ideas in mind, do we or don’t we set goals?
Benefits of Setting Financial Goals
- You can look at your future as a series of consecutive goals and plan a roadmap to get there. This can help clarify what you’re working toward and how quickly you think you’ll get there.
- You have a set of baseline numbers to compare your progress to. You can tell if you’re falling behind your goals or getting ahead.
- Goals can inform your current behavior by guiding the next actions and decisions you need to make to get progress.
Benefits of Not Setting Financial Goals
- Goals can be restrictive when circumstances change. Without goals, you’re completely flexible to change your mind or direction as you see fit and go with the flow.
- Current behavior can be focused on “just doing” instead of constantly planning and measuring.
- Focus is on accomplishments and achieved goals, what we’ve been able “to ship,” and not always thinking about the “future.”
- You can capitalize on your day’s passion or drive. If you feel like delivering pizzas this month, you can.
What will You Choose?
This gets personal. Trying to tell someone how to set goals is a foolish errand. So I’m looking for a bit of feedback. What have you done that’s worked for you? What advice can you share?
Photo by ollesvensson