Try This for Your Goals

Carl Richards Behavior Gap Try this for your goals

What if instead of making big goals around the new year or during a life change, we focused instead on making small, incremental changes? At the New York Times, I outlined three steps to get you closer to your goals.

This column, titled A Plan for 2012 That You’ll Actually Follow, originally appeared in The New York Times on December 26, 2011.

For 2012, I have a challenge for you: make financial decisions on purpose. Too much of what we do is based on habits and assumptions instead of a thoughtful plan. During the next year, see what happens when you do these three things:

1) Define your current reality. I used to think this was the easy part. Turns out I was wrong. Most people don’t know where they actually stand financially.

After the last few years, it’s tough to face the reality of our situations. Even if you have a sense that things have gone well for you financially, building a personal balance sheet doesn’t rank very high on the fun meter, but it has to be done. It makes it hard to reach any goal if you have no idea where you are starting from.

2) Set some goals. This step hangs people up because often we have no idea what we will be doing in five days, let alone five years. Still, it’s really hard to get somewhere if you don’t know where you’re going.

Let go of the need for precision. These are guesses, so make the best guess you can and move on. How important is paying for college for your child or children (or grandchildren)? Define it a bit. How much will it cost, what can you save, when will it happen?

Be honest. Be realistic. Of course part of this process will involve making some assumptions about rates of return you will earn. Be conservative and focus instead on having realistic goals and saving more. If you can’t save more, maybe spend some time trying to earn a bit on the side.

3) Commit to course corrections. Plan on then, in fact. Break down what you have to do into quarterly action steps, and then revisit the plan every three months.

If you are off course, make changes while you’re only a little bit off. If you leave Los Angeles on a flight to New York City and you’re a half inch off course, it’s much easier to adjust when you are over Nevada than it will be a few miles outside of Miami.

Planning for a better financial future is a continuing process, not a single event. It is also short-term boring but long-term exciting.

In 2012, commit to doing small, simple things consistently and over time. It will be the opposite of what we’ll hear in the news every day about making enormous changes, so part of the challenge will be to ignore the constant call for rash actions and sweeping reform.

Let’s make 2012 about subtle, small actions so we can make progress towards our goals over a long period of time.

Did you like this article? Join the thousands of readers of my Weekly Letter. There’s no spam, I never share your information, and it’s free.


Will you try something for me real quick?

Make a mental list of the things you REALLY want to be spending your money on. You know, things you value deeply. My list includes security, time with my family, and service in my community.

Now, gently compare that list to the way you ACTUALLY spend your money.

If you’re human, that exercise probably hurt a little bit because there is almost always a gap between what we value and how we spend our money.

I’ve been exploring that gap for 20 years, and closing it is the focus of my work.

“Carl gets the relationship between money and feelings better
than anyone on the planet.”
– Ron Lieber, New York Times

If that sounds interesting to you… you’ve come to the right place.

I've spent years looking for the best way to share my work. I’ve tried Twitter, Facebook Groups, blogging with comments, courier pigeons… everything. I've come to realize that nothing beats a well-crafted letter delivered to your inbox once a week and your ability to hit reply and start a conversation.

So each week I send a short email discussing topics like money, creativity, and happiness along with a simple sketch. And if I get it right, it will take you less than two minutes to read, but you'll be thinking about it all day.

"I love Carl's hand-drawn sketches. They feel so personal and immediate… like he couldn't wait to scrawl down whatever insight had just popped into that lightning-fast brain of his…"

– Kara Cutruzzula, Brass Ring Daily

So join the thousands of readers of my Weekly Letter. There’s no spam, I never share your information, and it’s free.