Comments on: Taking Baby Steps Towards Financial Goals

By: Ben - BankAim

Ben - BankAim — Fri, 16 Sep 2011 19:20:34 +0000

Dan said it well.. goals can be modified. I think that is a huge point to make. Who has ever set a goal and didn’t make changes to it along the way? There are obstacles that you have no control over, such as losing your job. In today’s economy people are losing their jobs and are unable to find new ones, this would be a huge set back, especially if you had to rack up the credit card debt to stay afloat.

By having goals now, when times get better, you will be further ahead then, than you are now. Plus as the market gets better, those goals might change a bit, such as investing in a CD or money market accounts.

By: Dan - BankVibe

Dan - BankVibe — Sat, 06 Aug 2011 21:50:29 +0000

Baby steps is the only route to take. The other piece of advice I would give would be to disregard the things you have no control over (ie the market, savings rates, etc). If you’re goal was to retire in five years in 2007, then this goal would likely of had to be pushed back a bit. Esp if your money was tied up in 401k’s or any other products with market exposure. Try not to get discouraged over these things…goals can be modified.

By: Eldon

Eldon — Wed, 24 Nov 2010 22:08:22 +0000

Baby steps…sounds like Dave Ramsey’s total money makeover. If you are serious about getting out of debt: Dave RAMSEY’s Total Money Makeover is the best system I have ever heard to getting out of debt.

By: Michael

Michael — Fri, 09 Oct 2009 19:42:59 +0000

I remember back when I was in my early 30’s and went to my first financial planning seminar with my wife. I decided right after it, and told her that I planned to be able to retire when I was 60 – she just laughed. Well I am now less than 5 years away and thanks to planning and hard work – we are going to be able to retire very comfortably – which back then seemed very unlikely. I agree you need both – long range large goals, and short term achieveable goals that let you know you are making progress.

By: Aluminum Case

Aluminum Case — Wed, 16 Sep 2009 19:24:25 +0000

I agree that this is an effective strategy for any big goals. If there is something big you want, it probably isn’t realistic to expect to reach that goal quickly. Setting smaller goals keeps the bigger prize still in sight and makes it seem possible to reach. Without these smaller goals, it would be easy to become frustrated and give up on what you’re working towards.

By: Peter Luke

Peter Luke — Wed, 16 Sep 2009 01:33:52 +0000

Another well-organized and insightful article. And great comments too! I have nothing more to add. Cheers!

By: FrugalTrader

FrugalTrader — Mon, 14 Sep 2009 12:28:04 +0000

Peanut, I would just say to keep doing what you’re doing! For me, it works best to work towards goals.

By: Peanut

Peanut — Mon, 14 Sep 2009 02:14:03 +0000

This blog has provided me much insights. I am motivated to set my own financial goals as I started late in life to start saving (spent money moving country to country, traveling to see my family). I just moved to Canada 2+ years ago and have accumulated CAD 38000 in savings. Much of my expenses are on rent (1100) & food/cable/utilies (700~800). At 32, I am debt free and I take home 3200 a month,saving 1300 monthly.
A few things I want to do, include, contributing 5K to my TFSA, maximising my RRSP (next year as it will drop me by 1 entire tax bracket). I find it frustrating that every penny I earn, I am taxed higher and higher. I am not eligible for GST returns, I’ll pay more for HST next year so I want to be money smart. I work very hard but I will also like to be money smart.
Will you offer some directions to a beginner like me?

By: Kirk S.

Kirk S. — Sat, 12 Sep 2009 11:51:39 +0000

Goal setting is extremely important (not just for finances). I personally make a list of annual and quarterly goals for myself and check in on them to make sure that I am headed in the right direction. Even just making sure that I write them down (or post them on a blog) makes it easier because then it is in the open.

By: Lior

Lior — Sat, 12 Sep 2009 01:00:53 +0000

You pretty much have it bang on! When faced with a big task, like paying off a lot of debt, start small. People often find it hard to believe how making prepayments, for example, whether it is toward your mortgage, car payment, or even equipment financing, can make a big difference. Even an extra $20 a week, a small sacrifice for lattes and icecaps and Timbits, can make a big difference in paying off your debt sooner and ultimately saving you money on interest.

When I started in my line of work, I worked part-time to pay for the cost of starting my business. Remember, I’m paid 100% purely on a commission basis. And when you’re new in the business, you can’t just go to other people you want to work with and say send me all the business you have. It takes trust and trust takes time to develop. So I took things step by step. I referred on a one-to-one basis to initiate relationships. I worked out a referral bonus structure that I can honour. And when it came time to buy things for the business, one pay cheque I got this, another pay cheque I got that. I started small, I didn’t borrow anything, and now all of the equipment I use on a regular basis is free and clear and I can allocate my income toward something more important. Of course, I could’ve just taken a loan and paid for all the things I needed in one shot, but I knew that at least initially I wouldn’t be able to afford the payments.

Start small, dream big, and make every effort to fulfilling that dream without going too over your head into debt.

By: ctreit

ctreit — Fri, 11 Sep 2009 12:23:52 +0000

Great post. You only get rich overnight, if you hit the lottery. All other get rich schemes take a lot more time. Some schemes never work out. Probably the ones that tout making money in your sleep with automatic tweets on twitter.com, for example.)

By: Jessica Griffin

Jessica Griffin — Fri, 11 Sep 2009 11:28:46 +0000

I think this is the perfect approach to take. I tackle my debt by prioritizing my loans. The ones with high interest and fines are paid off first, followed by those which give me more breathing space.

By: Ms Save Money

Ms Save Money — Thu, 10 Sep 2009 23:30:25 +0000

Totally Agree – and applies to all aspects of life.

By: Mark in Nepean

Mark in Nepean — Thu, 10 Sep 2009 23:11:22 +0000

Like everything else in life, having an “end in mind” first and then breaking down the journey into as many, manageable steps as you need to, is the key.

Define, act and evaluate. Cycle it through as many times as you like….

Easy to say, sometimes difficult for many (including myself) to practice :)

By: Maiku

Maiku — Thu, 10 Sep 2009 20:28:34 +0000

To be honest, I am really bad at this. Even when I did homework for school I would think about how to make the end product perfect and then procrastinate for several days before getting anything started.

I am now working on actually setting and achieving smaller goals to move me along in my finances.

One of the aspects that have been touched on is making the goal public or sharing it with others. Interestingly, I am reading a book right now called “Influence” that states that this is based on psychological need to appear consistent with our choices. Therefore making it public makes us accountable publicly (and need to appear consistent to others) and therefore more likely to try and achieve the goal.

By: Craig

Craig — Thu, 10 Sep 2009 19:04:57 +0000

You have to walk before you can run and same can be said with finances. Taking those small steps will make leaps and bounds over time. Just getting started and set up is a huge step and then motivating yourself to commit and continue will lead to future success.

By: The Power of Small

The Power of Small — Thu, 10 Sep 2009 18:44:57 +0000

Yes! We agree with you 100%. As we always like to say, the key to achieving even your biggest goals is to “think small.” For years, we’ve all operated with the philosophy that bigger is better, but the truth is, that SMALL is the key to success. When it comes to personal finances, setting small, manageable goals will be much more achievable in the long run than striving to meet one huge goal all at once. One dollar at a time, you’ll feel a sense of accomplishment instead of stress, which will fuel you on your journey toward true financial wellbeing.

By: kenyantykoon

kenyantykoon — Thu, 10 Sep 2009 17:36:24 +0000

i have never liked that piece of plastic that seems to give you total ownsership of the world. i have avoided getting one but i may have to because i may be going online in shopping and whatnot. and not to mention that i have to develop discipline in spending from that plastic

By: cannon_fodder

cannon_fodder — Thu, 10 Sep 2009 16:21:17 +0000

I’d say I actually make large course corrections when necessary. That typically allows me to achieve the same goal in a much shorter time frame (think of ripping the bandaid off versus waiting for it to fall off). I can have a myopic focus when necessary.

I don’t know if it was discussed in the related article about which form of debt to pay off first, but I wanted to point out the disadvantage of paying down the smallest amount of debt first. While it may have a psychological benefit by seeing one debt component eliminated, you could actually see your overall debt increase.

How? Simple – if you have a low debt amount at a low loan rate, and a much higher debt amount at a much higher rate then it could increase faster than you are able to pay down the smaller amount. All of a sudden, the argument for the psychological benefit is now diminished.

By: Russell

Russell — Thu, 10 Sep 2009 15:56:38 +0000

Setting goals anf following through is cetainly the most important step.