If you’re reading any post on a personal finance blog, the odds are that you are trying to achieve a goal through the means of money. But you may be wasting a whole heck of a lot of time diving through post after post in the personal finance niche without first asking yourself a few questions.
There are three questions I would strongly urge you to consider before ever reading another post on personal finances. If you can come up with a set of answers that satisfies you, it might just add an increased level of purpose and determination to your efforts. If not, well, at least they will have inspired a little introspection.
1. What is the End Goal?
When I say ‘end goal’, I’m not talking about superficial achievements such as buying that Ferrari you’ve always wanted or a house, or even things like getting out of debt or retiring. On the surface these may be short-term goals that you want to achieve, but what emotional need is lurking underneath?
What are you really trying to accomplish with money. Are you trying to eliminate fear? Eliminate stress? Buy more time for yourself? Free your mind? Experience more that life has to offer so that you don’t feel regret later in life?
2. What do I have to Sacrifice?
Achieving big financial goals to fulfill emotional needs requires sacrifice. It’s one thing to aim for being completely free of financial stress and fear – but achieving that goal often requires a whole lot of work, stress, and sacrifice to get there.
What exactly will you need to sacrifice? This may require some serious number crunching. It also may require you to re-evaluate the true value of financial and career goals, material possessions, and time. Are your end goals worth these sacrifices?
3. What am I going to do when I Get There?
We’ve all heard the stories of people who have worked so hard all their lives to finally get to retirement and are surprised that when they get there they are no happier than while they were working to get there.
Here’s the rub. As humans we set big goals. And when we get there? Well, we tend to ask yourselves ‘what’s next?’. We’re ambitious creatures. And ambition often clouds our judgment.
What I’m suggesting here is to really ask yourself if achieving your goals and fulfilling your emotional needs via money is going to make you happy. Or will more happiness come in finding the proper balance between the means and the end?
So, my friends, what are your answers?
This really does make you stop and think. My goal is to become financially independent and work for myself. The underlying emotion I want to fill is satisfaction in how I live my life. I realize that it’s going to take a lot of sacrifice, but I really wouldn’t want it any other way.
I think you miss something more importantly, and that is whether you are reading for knowledge, or entertainment.
There are many writers who are just entertainers with very little experience about finance. That’s great if you want entertainment. That’s what most of the people want actually, since how hard is it to save more than you spend?
@ Samurai – how hard is it to save more than you spend? Well, the U.S. national savings rate was recently below zero meaning that, on average, we spend more than we save. So to answer your question – pretty dang hard!!
Ah Miranda, but the US savings rate is now 4% and rising.
I don’t look at statistics, I look at myself. I’m sure you are saving more than you are spending too!
Samurai, I completely agree with you. Just like I don’t read diet blogs to for knowledge (burn more calories than you consume=weight loss), I already know everything I’ve read on finance blogs recently, but I read it for the entertainment value.
I think very few people who read them don’t understand the concept of savings. The problem is the people that are being preached to in finance blogs are rarely those enlightened enough to take interest (i.e. the ignorant masses).
Personally, I like to read them to reaffirm my financial beliefs. This occurs regardless of whether I agree with author’s message.
@ Daniel, Julie, Samurai – Don’t get me wrong – I agree that there has to be some entertainment value or something interesting to read on blogs. Otherwise, we’d all go read the dictionary. I do think that there has to be at least a little take-home value in the content that provides hope, inspiration, or knowledge to achieve financial goals. If I read a blog that just spits out the same old crap, I’m neither entertained or informed. The BEST blogs, in my opinion, have a good balance between the two. We all have a goal or two in mind that we are striving towards. Hopefully I’m able to share an idea or two that has some redeeming value in addition to keeping you entertained.
I agree with Financial Samurai. Just because people aren’t doing it doesn’t mean it’s hard. You don’t need to read every blog out there to learn every tip and finally break the threshhold. You need to use some self control to save more, and the rest is just gravy. Some blogs teach you about everything from credit to negotiating, and those are useful for people who want to learn and understand more about personal finance. Many of the more established blogs are focused on commentary, and my guess is that most people who read are doing so for entertainment purposes. Rarely is there anything groundbreaking going on there.
From you title I totally thought this post was going to be about asking who the author was of a blog before taking their advice, similar to what Samurai mentioned above.
Either way, I think you bring up a really good point with #3, which was also a Stephen covey concept of “begin with the end in mind.” A lot of people work really hard for financial freedom then don’t know what to do with it when they get there. It’s boring not having something to work towards and the fun is in the journey. I think also a lot of people regret not doing the things they wanted to when they were younger because they wouldn’t be on the “right track.”
Personally, I’m trying to be financially responsible while following my passions, such as shark diving and travel. Time value of money is too big of a concept to ignore.
Personally I have gained some knowledge from reading Finance blogs. Although some have been poorly written there are the jewels in the crown. My view is that you can read as much as you like but you don’t have to believe everything you read.
Pick out the information that is appropriate to you and your life and disregard the rest. Soon you will find that there are common themes that run throughtout any blogs.
Quite simply, if you find many people saying the same or similar things, you would say that there is a good chance the information is true.
I don’t know about the others, but what I meant by “save more than you spend” was not “save at least half your income”. I usually mean “have money left over at the end of the month”. I actually do save more than half my income, but that’s easy to do when you live at home, and have a boyfriend who pays for at least half our outings.
I totally agree that the end goal is quite important to keep in mind. I also totally agree that I do not save more than I spend. Right now, on a teacher’s salary, I bring in about 2,600 a month. I am very judicious about smart grocery shopping, almost never eating out, and very few extraneous expenditures. I have managed to save each month, but it is a far under what I spend. Saving more than you spend is an option when you move up the salary scale, but not for recent college grads like me. And of course, if I ate rice each nice and lived under a bridge it would be possible.
I think you hit it right on the head with 1. What is the End Goal?
Everyone has goals and dreams that they’d like to accomplish. Things they would do if they knew they had no financial worries. It’s not the money or the amount of money that people are tied to, it’s the dreams. Many times, however, these dreams require a certain amount of financial security in order to reach them. The bottom line is, I think what most people want is freedom, freedom to choose what they want to do, whenever they want to do it, it whoever they want to do it with. Great post!
I’d ask myself “Have I read this type of article before?”