When I meet with unemployed clients at the Job Store or participants at a bankruptcy class, there is a general feeling of disappointment, maybe even depression, about where they are in their lives at that point in time. Money issues seem overwhelming and most people feel like they are never going to have, or accomplish, the things in their life they wanted and expected as young adults. I like to reference the movie The Bucket List, because the plot of that movie is about making a wish list of things you want to do before you “kick the bucket.” Unfortunately, most of us do not have access to a millionaire like Jack Nicholson who will pay for all the expenses associated with the items on our bucket list. That is why we need to learn to set goals, both financial and personal.
The first (and I feel) most important step in any kind of basic budgeting process is goal setting. Unfortunately for many people, it is a foreign concept. They have never connected putting together their “bucket list” with their financial statement. Money is the means by which one pays bills and puts food on the table. But in reality, money is also a tool to help you reach your goals. Dr. Laura King, a University of Missouri psychologist, has focused much of her research on the power of goal setting to create and sustain well-being. She stresses the importance of letting go of our lost “Possible Selves” (the people we once thought we’d be) in order to start over with newer, more relevant goals that will help us become the people we want to be now.
What are your goals? Start by making a list of your dreams. Write them down. You might think this is a silly exercise, but how else are you going to identify what you want? Be specific about the things you desire. If you say “I want to travel,” that is very vague. However, if you say “I want to tour Great Britain,” then you have a specific goal that you can start to plan and save for. The next step is to find and direct money towards that goal.
Think about all the things you purchased over the last few years that really didn’t mean much to you. For example, snacks and drinks. Could you have waited a half hour more until you got home to eat something? Drank water out of the water fountain? What about that impulse clothing purchase? Did you really need another sweatshirt or T-shirt? Those dollar expenditures may not have felt like much at the time. $5, $10, $20. But every time you spent those dollars, you redirected them from something you wanted more (like Great Britain), to something you didn’t care much about. There’s an old saying that goes “you can only spend a penny once.” It might be more relevant to switch it to a dollar, but the meaning is the same. In other words, think about what you are buying before you buy it, to make sure you really want it. Because there is no such thing as making that same dollar later. You can make new dollars in the future, but you can never get back the dollars you made and spent in the past. That is why goal setting is so important. It helps you stay focused and keeps your “eye on the prize,” so to speak.
Do you think you don’t have any extra income to put towards your goals? A serious look at your budget may help you identify expenses you can adjust to pull out a little extra cash. With fixed expenses, you are committed to paying the amount agreed upon at purchase. Your house payment and car payment are two prime examples. But utilities, although considered fixed expenses, have a little more wiggle room. Could you lower your thermostat to save on your gas bill? Hang clothes on the clothesline? Get a different cable package? Use a phone without all the bells and whistles?
What about flexible expenses? This category has even more wiggle room. Take a look at your food budget. Do you buy pizza every Friday night? Many families spend $20-25 per week just on pizza. How about if you only buy pizza every other week, then take those two $20 bills from the weeks you didn’t buy pizza and put them away for your dream vacation? On those in between Friday nights, you could just make something cheap and easy like tacos.
The point is, if you want something badly enough, and you identify it as a priority in your life, you will be more willing to take the steps necessary to achieve it. Writing down your goals gives you hope and a feeling that you control your destiny. Telling people about your goals will commit you even more, because you won’t be tempted to give up when the going gets a little rough.
But the bottom line is that defining your goals will help you successfully achieve your dreams. Don’t let another year go by where you accept the status quo. Not to be too maudlin, but hey, none of us knows when our number is going to be up. It’s important that we engage in life to the utmost of our ability and talents. Goal setting, or making a bucket list, will help you accomplish that.
Family & Consumer Sciences Educator
Ohio State University Extension