Happy day to you. This is Ken Kaufman and I’m thrilled you’re here for episode number 37, “List your Goals, Priorities, and Dreams.” Now, as you’ll recall in step one of the process of building a financial plan that we covered in the last episode, you need to establish this current net worth and cashflow baseline and they’re best assessed by creating a net worth statement and a cash flow statement. And this creates that nice baseline to get started with the planning process. Today we’re talking about step two. And this is a process where you get to sit back and you get to do some dreaming, some thinking out there in the future about what types of things you want to accomplish, about what your goals are, about who you want to become, and who you want to help others around you become and what you want to help them accomplish.
And so, in this step two, we’re jumping into life goals, priorities, and dreams, and what you want to accomplish. And I do need to be clear that this step of almost all of them, it is the least of all of them of being something where you do it one time and you walk away from it. This is a lifelong process. You’re constantly going to be defining and redetermining what it is you want to do with your life. As you get older, as life happens, as priorities change or preferences change, there’s so much that goes into the process. But the key thing to know here is getting started with this process and getting a routine set up so that you can be updating this on a regular basis is tremendously important for your financial plan.
And before I jump into actually the process of how you go through this and why it’s so important to your financial plan, I want to share a quick personal example. Shortly after my wife and I were married, we started thinking about what are some of our long-term goals? Obviously, we’ve got to figure out how to retire at some point, and so you build a plan around that or at least we did and we continue to update that. But we thought about what are the things we want to do as we get older, and what do we want to accomplish, and what do we want to help our kids accomplish, and maybe even our grandkids?
And we realized, my wife and I, that it was a big priority that we serve a mission together for our church. It’s something that I did when I was 19 years old and enjoyed it. And my wife and I look forward to an opportunity to do that together. And so, we created a plan and we figured initially, hey, somewhere around age 60, 65, 70, somewhere in there, when we’re retired and we don’t have as many commitments and maybe kids are out of the home or they’re much older, it would give us a chance to be able to go and do something like this where our commitments and other things wouldn’t be as much of a burden or would keep us from being able to fulfill accomplishing this dream that have for ourselves. And so, we created a plan around that and we started to save for it. And then we realized, “Hey, we want to help our kids be able to have the same opportunity when they’re around 18 to 20 years old. And so, we put that in a plan and we started to save for it.
And over time what’s happened is all of this has merged into what we now call our life event plan. And it has an accompanying fund that’s associated with it, and that fund is helping us know how much we should be saving so that we can help ourselves and our children to accomplish this goal or this dream that each of us have. So, in the plan, we have key birthdates in there. For example, when each child turns 16 so that we can know that our car insurance is going to go up dramatically, and other birthdates and key milestones in their lives. And we’ve added this going on a mission right into that plan. And today, this plan is now all set up so that it actually calls for my wife and I to leave on our mission in February of 2038 or a little less than 20 years from now.
And we’re excited. That’s our dream and it’s something that we’re going to be working toward. Now, most likely it won’t be that month, might not even be that same year, but it’s so empowering to get it out there and then to figure out what do I need to be doing today in order to be able to accomplish that? We’ve also done the same thing with our kids and helping them plan for their missions. The thing that’s interesting about the timeline that I picked is our youngest is going to be about 20 years old in February of 2038. And we may do it later or earlier, like I said, but think about it, we’ve got almost 20 years to prepare ourselves for this, and always and especially financially to be able to make it happen, it just feels like with that much time we will be able to figure out how to make this dream come true and that’s the power of doing this dreaming and figuring out all these things and then starting to plan for them.
Now, I need to highlight why this type of dreaming and thinking is so critical because it just helps you to know what to start planning for. And if you know what to plan for, then when you’re building your financial plan, you make sure that you’re doing everything you can today, tomorrow, next month, next year to be able to accomplish everything that you want. And here are some of my favorite quotes on this that I love. Benjamin Franklin. This is my favorite of all said and repeated regularly. “If you fail to plan, you plan to fail.” Or in other words, you will not achieve what you want to achieve and you will not be able to do what you care about if you don’t take the time to plan because failing to plan means that you are planning to actually fail or to miss the mark on some of these things that are really important to you and to your spouse.
Another quote from Alan Laken said this, “Planning is bringing the future into the present so that you can do something about it now.” There’s nothing like getting alignment on where you want to go with the actions that you’re taking today. Planning is bringing the future into the present so you can do something about it now. And then I’ve always loved this quote from Dwight D. Eisenhower who said, “In preparing for battle, I have always found that plans are useless, but planning is indispensable.” I’ve mentioned this before, plans are useless because the moment you hit save on that plan, it’s wrong. Nobody has a crystal ball, nobody knows exactly what’s going to happen in the future, but the planning process is what’s indispensable because it gets hearts and minds aligned. It gets activities driving toward those outcomes, but then it empowers you to see the whole picture so that when something goes wrong or something changes, you can make a tweak, make a change in your plan, and now all of a sudden, you’re accounting for whatever those new factors or whatever those new variables are and you’re still on track to move forward with. In this case, he was talking about winning a war, but in the case that we’re talking about, it’s winning at life and it’s getting our finances organized to empower us to win at this game of life.
Now, another great benefit of going through this visualization exercise about out there in the future is getting alignment with your spouse. You may see the world much differently in the future than your spouse does. And it’s really important that the two of you commit to working on getting alignment on your combined future so that you can then align everything that you’re doing now with accomplishing everything that’s important to you down the road. Now, how do we go about this? Let’s get into some of the blocking and tackling here that’s required to get into this dreaming and how do we jump into this? I have a framework for you to use to go through this process.
You can get out a piece of paper and a pen or laptop or phone with whatever notetaking device or apps you like to use or software. Whatever’s easiest for you, you want to start to just put some things down on paper, put some things down on digital paper that will give you the opportunity to start to articulate what’s important to you in the future. And I want you to start by thinking about this. Think about yourself as if you are 80 years old, what would you want to be true about yourself and about your life? What condition is your physical and emotional health in? What passions, hobbies, and other pursuits will make you feel the most accomplished and the most proud of your life at that age? What type of service do you hope to have rendered? What is the status of your family relationships? Have you traveled as much as you want to or wanted to?
And you can go on with this list. I’m not saying that I’ve got all the right questions to ask, but as you start to jot down some of these answers, this starts to open up your mind in terms of if I’m 80 and I’m looking backward at my life, what would be important to me at that stage? I can tell you this in my physical health right now, the way that I exercise and the way I’m trying to eat and the way I’m doing things is all lined up for me to feel fantastic from a health perspective at the age of 80. I’m no longer cranking out heavy crazy weights or doing, you know, crazy long runs and different things that are just hard on the body that are pounding the knees and doing those sorts of things.
I’m very focused on how can I drive my health so that at 80 years old, I am thrilled with how I feel and how my body feels when I wake up every morning. Maybe that’s not possible. I don’t know. I’m not 80 and maybe you can’t feel good every morning when you wake up because of the aches and pains and everything else, but this is what I’m talking about. Thinking about where you’re going to be or think about yourself at 80 years old and then think about what will you be the most pleased with yourself if you’ve done wherever you’re at today, if you’re 20, if you’re 25, 30, 40, whatever it is.
Now, as you’re thinking about all this and starting to write some of these ideas down, now I want these to lead you into answering these three main questions. And I need to stress here, this isn’t just about money. This isn’t just about our financial state. This is about a holistic view of life. This first question is, what is it that you want to accomplish in your life? The second one is, what do you want to help your kids accomplish in life? The third one is, what do you want to do to help your grandkids accomplish in their lives? And then a fourth one is, what organizations and causes do you want to help during your lifetime? Because it’s something, you know, you believe in and want to put effort into. Something that could be professionally believing in, you know, the organization that you’re working for, for income, or those can be charitable causes and so on.
Now, it’s important, again, like I said, you don’t just focus on money when answering these questions. Money is a means to an end. We have to remember that. So, saying, “When I’m 80, I want to have $1 million in the account.” Well, who in the world cares? Because if you’ve lived a miserable life and you don’t like who you are and you’re not pleased with what you’ve been able to do and accomplish in life, what in the world does that money mean to you? Probably not very much.
And so, remembering that money is a means to an end and that it is just there to help you accomplish the things that are most important to you, it is only a part of the story. You and who you are becoming is the most important part of the story. You’re the most important ingredient, the intellectual ability, spiritual ability, all of the capabilities that you’ve worked to develop over your life and your perspectives and your thought processes, all of that, you are the most valuable component of all of this. Money is going to help you accomplish and further your impact on your family, on the world, whatever it is it’s important to you. And so when you’re 80, you want to be thrilled with the life that you’ve had and all the things you’ve accomplished and, most importantly, who all of that has empowered you to and allowed you to become.
Now that you’ve written some of these ideas down, it’s a good idea to set it aside for a little bit, couple days, a week, a month, and then come back and revisit it. You’ll find that some things will feel a little bit silly that you wrote down or not quite as important as others. You’ll find that there’ll be new ideas come up that you want to actually add to the list. What isn’t as important as you thought might become less important over time and also look at that list and start to think about how aligned are my spouse and I, what do we need to do to get more aligned on these things, and where do we need to get more alignment and work toward, you know, discussing and working on?
There is a repetitive process…that might not be the best way to say it. Probably a cadence that’s probably…this is a better way to say this. There’s a cadence that you need to get when it comes to thinking about your goals and your dreams and the things that you want to accomplish in your life, whether it’s every quarter or every year you’re pulling this out eventually. This initial time I’d recommend, do a start, come back to it a couple of days or a week later, work on it some more, put it away, work on it some more, maybe a month, a week or a month later and get to a place where you at least felt like, “Hey, I feel like this is pretty accurate and I’m starting to get aligned with my spouse on some of these things.”
Then as you get older, as the years go by, every quarter, every year you’re pulling this out and you’re revisiting it and what now looks not as important, what are new things that maybe have come up or life changes that have happened that make you think about the world differently? And the key point here is keep iterating. Just keep revisiting the discussion, develop out that cadence. And then, most importantly, once you get that figured out, whatever your most recent iteration is and you feel like it’s accurate and as right as possible, now you need to take it and you need to make sure that your financial plan prioritizes all of those things and accounts for them as best as it can, and it can inform you as to what’s a reality for you based on your current path and your current income and everything else that’s going on in your life and what might look at risk of you not being able to accomplish and then that allows you all this time thinking about these things down the road in the future.
It gives you lots of time to start to figure out what can you do now to try to reposition yourself and reposition your financial plan to be able to accomplish everything it is that’s on your list or most of what’s on your list. Again, this is up to you and it’s 100% your prioritization. So, you get your dreams, your goals, your priorities all on paper. This empowers you to go into step three of the financial planning process, which is income and cash flow planning. So, make sure to subscribe to the podcast so you don’t miss that episode or all of the ones after that that are laying out in great detail for you all of the critical steps of creating a comprehensive financial plan for your life, and then a cadence to keep updating it regularly based on things that change just because life happens. Many, many thanks to you for joining today. This is a wrap for episode 37. Happy day.
