How To Make Achieving Financial Goals Easier And Faster

How To Make Achieving Financial Goals Easier And Faster

When Warren Buffett was younger he asked himself, “Do I really want to spend $300,000 for this haircut?”

Why $300,000? Because he knew how powerful compound interest would be with his ability to invest.

It can be argued nothing will have a greater impact on your quality of life than achieving long-term financial goals.

Financial independence, saving for a down payment on your dream home, paying off student loans, becoming debt free…all these are examples of long-term goals which can enhance the quality of your day-to-day life.

The problem–each of those goals takes years if not decades to complete. While you’re working towards long-term goals, how do you balance your short-term and long-term interests?

In other words, should you get the haircut knowing it will cost you thousands years down the road?

I occasionally come across a story about an individual who didn’t waste a cent for 20 years and was able to retire extremely early. While these stories are inspiring, it’s no achievable for 99% of the population.

Children, student loans, some bad decisions early in life, not wanting to live without air conditioning…everyone has a reason.

For most of us, personal finances are about balancing short-term and long-term interests. This of course isn’t easy in personal finance because of compound interest.

The purpose of this article is to discuss a strategy that has helped me immensely in balancing my own short-term interests and long-term financial goals. A strategy that will help you reach any long-term financial goal easier and faster.

How To Achieve Long-Term Financial Goals

The secret to achieving long-term financial goals isn’t more willpower, more self discipline, eating rice and beans every day or going without air conditioning. Fortunately, it’s a lot easier. The secret is to “trick” yourself.

By understanding how your willpower works, you can make achieving any goal much easier.

You see, your willpower is a lot like a muscle–it fatigues with use. Essentially, you can’t count on willpower to last forever.

Just like a muscle, once your willpower goes beyond its current capacity it needs to rest. Only once it rests, does it grow.

Therefore, your goal is to use the limited willpower you have to set up a system. A system that operates behind the scenes and essentially hides your hard earned money from yourself.

For example, say your goal is to save $1,000,000 in a retirement fund. You plan on achieving this goal through your 401(K) and a IRA.

In a 401(K), the money is automatically withdrawn from your paycheck into your account. You don’t initiate the transfer every pay period, it’s completed automatically. This makes hiding the money from yourself, fairly easy.

An IRA on the other hand, needs to be withdrawn from your personal account. The money goes into your personal checking account, and then after you initiate the transfer, it’s deposited into your IRA.

Fortunately, you can automate this deduction into your IRA by linking your investment account with your direct deposit account.

Say you’re paid on the 1st and 15th of the month for a combined monthly income after taxes and 401(K) deduction of $3,000. In this scenario you can initiate a deduction of 10% or $300 on the second of the month.

The benefit here is what’s left over is yours to spend. In the example above, you’d have $2,700 of monthly living expenses you can spend guilt free as you’ve already put money towards your long-term goals.

Achieving Long-Term Goals Faster

Hiding the money from yourself makes it much easier to achieve your goals. While this method works, it does take time. So, how can you get results faster?

Here’s the trick…

Whenever you get a raise, bonus, gift…use your limited amount of willpower and put a certain percentage away immediately.

For example, say you’ve gotten a 4% raise. In this scenario, you could increase your 401(K) contribution by 2%.

If you’ve gotten a bonus or a gift, put immediately a percentage away towards your goals. Then, you can spend the rest guilt free.

My second trick for achieving these goals faster is to once a month, I’ll make a list of “20 Ways I Can Achieve My Goal Easier or Faster”. Another good question I ask is, “What are 20 things I can do today, I’ll be thankful for in 10 years?”

It’s not hard coming up with a list of some ideas. Selling an item on eBay, picking up an extra project at work…I just write what comes to mind. I then implement one or two using my limited willpower.

Achieving any goal that’s worthwhile is hard. If it wasn’t hard, everyone would be able to accomplish it.

The key is to understand how willpower works. By doing so, you can make achieving any goal, not just financial, easier and faster.

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R.J. Weiss is a CERTIFIED FINANCIAL PLANNER® who specializes in personal insurance planning for individuals at Weiss Insurance Agencies. He posts once a week on at the Insurance Protection Blog on his company’s website.

5 Things You Never Want to Hear In Your Negotiations

5 Things You Never Want to Hear In Your Negotiations

It doesn’t matter what it is that you are trying to negotiate, there are simply some things that you do not want to hear. You want things to run smoothly during this process with things preferably favoring you. To make this happen, the other side needs to agree to satisfy your most important goals. That may seem difficult, but it can be done. With proper skills and training you will know if your negotiation is heading in the right direction. These five phrases can make you cringe when you hear them during your negotiations.

“This is a one time deal. There are no further talks.”

Chances are this is nothing more than a bluff and demonstrates a lack of negotiation skills training. Even if it’s not a ploy, the last thing you want to hear is that the person you are negotiating with is not receptive to working with you.

“I’m trying to be the good guy here.”

This statement gives you the impression that they are taking the deal too personally. They may think more with their emotions rather than their brain but by investing time in training you learn how to keep your emotions out of the negotiation. A skilled response may be to divert their attention back to the product or service you are negotiating and gently remind them you’re looking for a satisfactory mutual agreement.

“I don’t think we are going anywhere.”

This is a sign that they have already mentally checked out. Their conclusion is that the deal is not going to close and that they are wasting their valuable time. In negotiation skills training you may learn that this may be the time to start asking open ended questions to regain their involvement in the negotiation.

“Why don’t you give me a number?”

It’s true that you usually want to take advantage by being the first to state a number. Just be careful, as too high of a number might insult the other party and too low of a number could cost you money that they would have otherwise paid. Utilize your negotiation skills and consider estimating the value with valid reasons behind your estimation.

“I’m offended by this offer.”

This is a clear expression of insult. They have taken the negotiation to a personal level and it is time to use your negotiation skills and training to do a little repair work.

You will find that there are times where even the best negotiation skills cannot pull you through. Even those negotiators with the best training in the world could not get through to the most obstinate of opponents. You have to know when it is time to simply walk away. This can be a difficult decision to make but it is one that must be made on occasion. Remind yourself that there are better deals to be had elsewhere. Take your skills and training and move on to the next deal and hope the negotiation goes much smoother.

Melissa White, a successful sales representative, has written several articles from her experiences during negotiation skills training to share with professionals in her industry.

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