Setting goals helps trigger new behaviors, helps guide your focus and helps you sustain that momentum in life.Leslie Riopel
We define a goal as:
“A future dream or desired result that a person or family envision, plan and commit to achieve.”
You may have noticed that we didn’t use the word financial in our definition of a goal.
That is intentional.
What we have found, after years of helping people with their financial plans, is that people often frame their goals from a financial perspective, when in reality the why behind their goals is about much more than just the money.
For example, if an individual tells us one of their goals is to buy a family vacation home in Kauai, we will explore the heart behind this goal.
As we explore we discover that the individual had some very fond memories of childhood vacations to Kauai and wants to cultivate those same types of memories for their children and grandchildren.
The financial portion of the goal is to buy a $1.5MM home in Princeville, Kauai. But the heart behind this goal is to build shared family memories in Kauai.
Finances allow the freedom to buy a home on Kauai that is big enough to house the entire extended family. But the heart behind it, shared family memories, will empower the individual to create that financial freedom.
Benefits of Establishing Family Goals
There are 5 major benefits of establishing your family’s life goals.
- Help us determine our WHY
- Tell us where we are going
- Establish benchmarks
- Determine success
- Help establish time requirements
Brainstorming Your Family’s Life Goals
Brainstorming family goals is one of the most exciting parts of creating a family financial plan.
We encourage families to make it FUN!
Here are some ideas:
- Set aside an afternoon or evening to get the whole family together to cast vision and dream.
- Make a special dinner or go to a special restaurant.
- If you have a special family outdoor location like a beach or lake, make plans to go there.
- Give each family member a pad of paper with some crazy colored pens.
- Create some predetermined questions that engage your family. A few examples are:
- What are the family’s passions?
- What are the family’s values?
- What inspires your family?
- What does success look like for your family?
- What energizes your family?
- How do you relax as a family?
- What things would the family like to accomplish this year? Next year? In 5 years?
Once you have some ideas on your brainstorming sheets, compare notes and write out your family’s collective life goals.
Check out our free Clear Creek Goal Worksheet (PDF) we created to help get your creativity flowing and see a few examples.
Tips for Framing Your Family’s Life Goals
As you think through and write out your goals, it can be helpful to use the SMARTER framework for setting life goals.
SMARTER stands for:
“S” – Specific
“M” – Measurable
“A” – Achievable
“R” – Relevant
“T” – Time-bound
“E” – Exciting
“R” – Relevant
Having goals that are (S)pecific and (M)easurable keeps us focused. (A)chievable and (R)elevant goals keep our feet firmly set on reality but also connect to a deeper purpose. Having goals that are (T)ime-bound brings accountability through a target date. (E)xciting goals keep us internally motivated. (R)e-adjusting speaks to the reality that life is unpredictable. Things we wanted 15 years ago might not be the things we want today.
There should be three buckets of goals, short-term (0-24 months), medium-term (2-5 years), and long-term goals (5+ years).
Short-term (12-24 months) financial goals could be:
- Paying off debt
- Holiday gift savings
- Start Investing Fund
- Start-up / Side Hustle Ignition Fund
Medium-term (2-5 years) financial goals could be:
- Saving for a home down payment
- Paying for a vehicle in cash (Car, Boat, RV, etc.)
- Major home remodel
Long-term (5+ years) financial goals could be:
- Paying off a home mortgage
- Saving for a child’s college education
- Retirement Savings
- Fund a generational trust
By putting your goals into separate buckets, you can begin to create different savings and investment strategies for each bucket.
This also allows you to achieve some quick wins while focusing on some short-term goals. This helps to build excitement and momentum to carry you and your family through the medium and long-term goals.
A goal is a future dream or desired result that a person or family envision, plan and commit to achieve.
Creating goals helps to keep you and your family focused, cultivates excitement, and outlines what success looks like.
Goals should be exciting and inspiring.
Using the SMARTER framework and categorizing them into short-term (0-24 months), medium-term (2-5 years), and long-term goals (5+ years) helps bring clarity and focus.
Remember that money is meant to help you achieve your goals, it is not the primary goal.
Interested in creating an individual or family financial plan? Give us a call or reach out to us via our contact page. We would love to meet you and your family!
About the Author: Located North of San Francisco, Jason specializes in financial planning, investment management, and tax strategies for families across the west coast.