Why Financial Goals Alone Are Meaningless

Throughout life we grow up hearing about the importance of setting goals. Right from being children we are encouraged to select study options for future career ambitions, which we may grow to not desire. Goals are evidenced in all the choices we make, whether it be supporting our children to establish themselves, choosing the right house type and location to call home, picking a vehicle to drive, positioning a business for sale and even to planning for retirement. The list goes on!

Whilst the above are not financial goals, most do have a significant financial impact. The cost of schooling and further education, the hefty price of a nice house in a desirable area, the high cost of premium brand cars, the finance required to remodel a business ready for sale and the significant wealth needed to support even a modest retirement that can last 40 or more years. Most of the things that are important life decisions are not financial, but they do often require significant sums of money to fund them.

To target your financial planning based upon material spend alone, however, would be a mistake. Financial goals are meaningless without a strong emotional core motivation. Almost all of the decisions you make and how you make them are influenced by the teachings, disciplines and experiences that you were subject to as you grew up.

Have you ever set a goal and then not followed it through? I know I have. Why didn’t it work? Because it did not mean enough. Imagine someone who has been unhappy with being a smoker for many years, who has tried repeatedly to give up and one day they manage to stop permanently. What changed? Maybe it was a health scare that made them realise smoking may impact their long-term wellbeing and opportunity to enjoy good times with their children or grandchildren. The change was finding a really strong emotional key driver to overcome the inertia, fear or whatever was holding them back before.

Financial planning requires the same emotional drive to ensure long-term discipline and goal achievement. As Financial Planners it is important for us to take the time to really understand who you are, what is important to you and more importantly, why these things are so important to you. It is only in understanding your core motivations that your financial planning becomes meaningful, so we can support through the inevitable ups and downs and to achieve not only your financial goals but your life ambitions also.

Karl Lavery

Financial Planner & Director