Most financial failures are a consequence of either poor planning or lack of planning altogether. Financial planning helps you set goals. It helps you decide the kind of life you want to live over a period of time and what you want to achieve in life.
Perhaps you would like to take your children to boarding schools next term. Or, maybe you hope to set up a poultry unit in your backyard in the next six months. Whatever your goals might be, you have a better chance of achieving them if you write them down.
This is because you need to monitor your progress by checking on your list periodically. Therefore, it is extremely important that you write them down.
Your plans must have a timeline and must be quantifiable.
In other words, they must be SMART (Specific, Measurable, Achievable, Relevant, and Trackable). When writing your goals, it is better to divide them into long-term, short-term, and medium-term sections.
Short-term goals might include buying a new radio or television. Medium-term goals could be paying school fees for your children. Long-term goals might include constructing a house or even leading a financially comfortable life when you get old.
But the starting point is to determine your values, that is, what you believe in and stand for. These define your personality and character. They form the core of your virtues and qualities. After determining them, you should commit yourself to them, but you have to review them periodically because values, like goals, change over time.
According re-known motivational writer, Brian Tracy, successful people are successful because they are very clear about their values. Unsuccessful people are fuzzy or unsure. Complete failures have no real values at all.
Tracy argues that clarifying values is the maiden step in building self-confidence, self-esteem and personal character. When you take the time to think through your fundamental values, and then commit yourself to living your life consistent with them, you feel a surge of mental strength and well-being. You feel stronger and more capable. You feel more centered in the universe and more competent of accomplishing the goals you set for yourself.
He suggests two things you can do immediately to put these ideas into action.
First, he states, decide for yourself what makes you truly happy and then organize your life around it. Write down your goals and make plans to achieve them.
Second, he further states, begin with your values by deciding what it is you stand for and believe in. Commit yourself to live consistent with your inner most convictions - and you'll never make another mistake.
Tracy underscores the importance of self-confidence in achieving all your goals by pointing out that most successful people have incredible levels of self-confidence and have accomplished great levels of success and happiness in their lives and seem to be uns toppable in everything that they do.
“The fact is, that when you develop unshakable self-confidence your whole world will change for the better,” he states adding, ”You'll have the confidence to take whatever steps necessary to make more money and enjoy a higher standard of living. You'll be more powerful and persuasive with other people. And you'll be more popular and likable. “
Make sure you prioritise your goals by dealing with the most important ones; and, work toward achieving these goals first. If your goal were to pay off all your debts, it would be better to start paying off the one with the highest interest rate. But you must be flexible and aware of the ever-changing environment because circumstances might compel you to change goals.
One of the ways to be knowledgeable is to educate yourself. You have to read widely and listen to the radio and watch relevant television programmes. If you can, read plenty of financial literature, including the business/financial sections of newspapers.
Talking with knowledgeable people, as I used to do during my nascent years, is another thing you could do. Many times I would go to Mr Simon Rutega (the Uganda Stock Exchange boss), Mr Japheth Katto (the Capital Markets Authority boss), or Mr Walugembe Musoke (the former spokesman of Bank of Uganda) with my notebook; asking them questions for my own consumption.
With a little effort you can learn enough to make informed decisions, and develop good financial habits, such as budgeting, saving, and investing. All are important and related: Investments can emanate from savings. Savings are determined by your budget, which is a result of your planning. The starting step though is setting goals.
Set goals for all aspects of your life, that is, social, financial, spiritual, intellectual and physical.
The writer is Managing Editor, www.myfinance.co.ug.
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