3 Excuses for Abandoning Your Goals

   What is your progress towards your New Year’s Resolutions? Are you still on track?

   After several conversations recently about people’s New Year’s Resolutions, it seems that already people are falling off track. 6 weeks into the New Year, and already for many people this year will be much like last year. And with that alarming realization, I thought it worth investigating what is derailing people from their goals.

   What I found is that the list of excuses is surprisingly short, yet alarmingly consistent. Here are the top 3 that I found during this informal survey:

  1. Not enough time
  2. Too exhausted after work
  3. Not that important to me anymore

Not Enough Time

   Perhaps the most pernicious of all excuses is the Not Enough Time excuse. This excuse is so damaging, and so widespread, because it is easy to rationalize. If only we had more time, we would easily be able to work on our goals. When we spout this excuse in a conversation, other people immediately relate, and hence we are let off the hook for our own shortcomings. Unfortunately, there is simply no more time in each day. 

   If time isn’t the answer, where does the answer lie?

   While there are many solutions, let’s look at one in particular: the way you track time, your calendar. If your goal is important, you need to allocate time in your calendar to its achievement. While you can’t find more time, you can certainly control how you spend what limited time you do have.

What time in your calendar will you block off for achieving your goals?

Too Exhausted After Work

   The next excuse has to deal with energy. After a long day at work, the amount of willpower and physical energy required to work on our goals simply isn’t there. Understanding how your body works, when you experience the most energy, is important to optimizing your routines. 

   For me, I have the energy to work on my fitness goals early in the morning. As such, I have aligned my schedule to allow time for the gym before the workday begins. This all begins with a good night’s sleep, allowing me to be rested when I wake up early, and then awake by the time I reach the gym after a light breakfast. Advancing my knowledge through reading comes over lunch and at right after dinner, allowing me ample time to process the information and wind down before bed in the evening. 

   There’s quite a lot of science and research done in the realm of energy management. Here’s a few key take-aways that you should apply to your life to find greater success:

  • It all starts with a good night’s sleep. 8 hours is recommended for almost everyone.
  • Understand your energy and stress levels, and work the gym into your schedule. You should aim to workout when you have energy, and to relieve stress.
  • Energy is a function of sleep and diet, make sure you are eating healthy foods! Eat foods that make you happy and healthy, just understand how your diet affects your energy levels.

   Being too exhausted is often a symptom of not understanding how your energy works. Designing your lifestyle and achievement around your energy will help you reach greater levels of success.

Not That Important To Me Anymore

   Another big reason I heard about why people weren’t sticking with their resolutions was that their goal simply wasn’t that important anymore. There were two main reasons for this. First, their resolution was made under the pressure, and having just heard, someone else’s resolutions. This led them to the trap of “that sounds good, I’ll do that too”. I see this all the time, people buying certain items, or trying to do or become certain things because they see someone else doing it successfully. 

   The second reason people’s resolutions end up neglected is that they have cast a wide net. Their goals are to become as ripped as Arnold Schwarznegger, as zen-like as the Dalai Lama, as rich as Warren Buffet, and as successful as Richard Branson. Becoming known for any one of those areas requires years of intense focus. Having a goal to achieve world renowned excellence in all areas means none of the areas will receive the focus it needs. 

   We all need goals in 6 key areas of our lives, physical, financial, mental, career, relationships, and romantic. But trying to achieve everything, in all of these areas, will lead us to achieving mediocre results across the board. Understanding what is important to you, and focusing on that will lead to greater success. Of all the excuses, the not that important anymore excuse is the most valid. But only if conscious thought is put in to determine where your priorities are.

   To avoid this excuse in the future, you need to become clear on what you want, and why, before you set your goals and resolutions. 

What is most important to you? What areas of your life are you okay with good, but not world-class results in?

   Knowing how to structure your routines will help you manage your time and energy. This will ensure that when you are most alive, most focused, most energetic, that you are focused on the most important thing. Deciding what is most important to you, and setting the right goals is half the battle. Organizing your day according to your energy and focus will bring execution to your best laid plans. And that, is a recipe for success.

What Is An RRSP?

   Registered Retirement Savings Plan (RRSP) accounts were designed to provide an incentive for individuals to set aside money for retirement. These accounts provide a central foundation for long-term saving goals. 

What is an RRSP?

   A Registered Retirement Savings Plan (RRSP) is a tax-deferred account. This works by deferring taxes until the money is withdrawn in the future. The purpose is to incentivize people to save for their retirement, which the government does by simply saying, save now, and don’t pay taxes on that money until you need it. 

   The way this tax-deferral works is by reducing your taxable income for the year by the amount of your contributions. For example, if you make $80,000 per year and you invest $10,000 into your RRSP, the government will only take tax as if you earned 80,000 - 10,000 = $70,000. You are therefore receiving $10,000 tax-deferred. That $10,000 will be taxed in the future when you withdraw your money.

   Your RRSP may be opened at any time, although some institutions will require you to be the age of majority. Any RRSP account that you own must be withdrawn or converted into an RRIF or annuity when you turn 71.

   RRSP’s are offered by a wide range of financial institutions, from banks to credit unions, mutual fund and investment companies, and even life insurance companies. Through these institutions, you may open an RRSP investment account. Once you have an account, you then have further options of where to invest. The below is a list of eligible investments in an RRSP.

Eligible investments for RRSP
  • Cash
  • GIC’s
  • Savings Bonds
  • Treasury Bills
  • Bonds
  • Mutual Funds
  • Exchange Traded Funds (ETFs)
  • Equities
  • Mortgage-backed Securities
  • Income Trusts
  • Gold & Silver Bars

What are the Benefits of an RRSP?

   The obvious answer here is that your contributions to an RRSP are tax-deferred, meaning you save money on taxes now, with the promise to pay that tax in the future. This works by allowing you to contribute more money to an investment account. For example, assuming your combined tax rate is 30%, and you plan on investing $10,000 pre-tax this year. If you were to invest after-tax, that $10,000 * (1-30%) = $7,000. Instead, by investing in your RRSP, the taxes are paid in the future. This means that you can invest the full $10,000 now, an extra investment of $10,000 - 7,000 = $3,000. That is $3,000 more invested now that can grow over time. 

   Using the tax-deferral of an RRSP account is especially important when you use your RRSP as an essential part of your financial strategy, allowing you to save taxes overall. For a more in depth look at how you can use different investment options to save taxes, check out our comparison between RRSP vs TFSA.

How Much Can You Contribute to Your RRSP?

   Unlike the fixed amount you can contribute to your TFSA annually, the RRSP has an individual contribution limit set as a factor of your income, up to an annual maximum. Your RRSP contribution limit is set by the lower of 18% of your annual income, or an annual maximum set by the government. In 2020, the annual maximum is $27,230.

   Any unused lifetime contribution room is carried forward each year. To see how much you can contribute, check out your account with the CRA. Most individuals who have filed in the past couple years will have been prompted to create an online account already, and since you’re reading this online, you probably are tech-savvy enough to have an online account

   Alternatively, your lifetime contribution limit will have been mailed to you (if you still have mailing selected as an option), and you can find this on your RRSP Deduction Limit Statement.

What If You Over-contribute To Your RRSP?

   There is a $2,000 safety buffer, allowing you to over-contribute by $2,000 before you will be required to start paying tax. The tax levied on excess contributions is 1% of the excess balance per month.

What if you need to Withdraw?

   Contrary to popular belief, there are no explicit penalties to withdrawing from your RRSP. If you withdraw from your RRSP, that money is taxed as income in the year that you withdraw. However, unlike the TFSA, when you withdraw from your RRSP, that contribution room is lost forever. For example, if your lifetime contribution room was $100,000 and you withdrew $15,000 for your wedding. You will pay tax on that $15,000 in the year you withdraw, plus, your lifetime contribution room will drop to 100,000 - 15,000 = $85,000. This lifetime contribution room is lost forever.

   There are 2 special cases where that is not the case, the First-time Home Buyers Plan, and Continuing Education. In those special cases, any withdrawals you make must be repaid over a set term. Essentially, you are borrowing from yourself. In these cases, the contribution room is not lost, but future contributions will be applied to the loan and hence not tax-deductible.

Advanced: Deferring Your Tax-Deferral

   You don’t need to claim your tax credit in the year that you make a contribution. In this case, you will essentially be putting after-tax dollars into your RRSP, similar to how you would a TFSA. Those “Unused RRSP Contributions previously reported and available to deduct” will show up on your RRSP Deduction Limit Statement.

   You may choose to do this if you expect to be in a higher income bracket in the future. This will mean you can still invest in your RRSP accounts now, and take advantage of investment growth, while saving the tax break for when you are earning more in a higher tax bracket.

What this all means for you

   The RRSP is an essential investment account for every Canadian. The tax-deferral properties give this type of account a big leg-up over traditional investment accounts. By saving on taxes now, you are able to contribute more, and let those investments grow over time. The taxes are then paid when you start withdrawing money. 

   If financial freedom is in your life’s plans (it should be), the RRSP is an essential tool to help you on your journey.

What is Your Next Milestone?

   What is your vision of the future? Where do you dream of being 10 years from now?

“Most people overestimate what they can do in one year and underestimate what they can do in ten years.” - Bill Gates

   Setting life changing and awe-inspiring goals often sounds very much like dreaming. The enormity of the goal is so daunting we don’t always know where to start. In these situations we also need to set milestones, smaller markers of progress that are more manageable. 

The Reason for Milestones

   Milestones serve a few essential purposes in goal setting. First, milestones provide a closer range target to aim for. This helps shrink the gap between where you are, and where you are trying to reach. Making the goal less daunting enables you to plan the action steps easier, and helps you keep motivation. As you progress towards a shorter range milestone, your progress is more easily seen, reinforcing that your efforts are making an impact.

   Milestones also provide something to celebrate. While achievement is certainly an important element for finding fulfillment, celebrating the smaller wins along the way keeps the journey light and fun. Your BHAG’s and long range vision shouldn’t feel like a chore, it should feel like you are doing exactly what you were put here to do. 

Milestones in Action

   For this example, let’s look at my BHAG. Within the next 10 years, by 2030, I am going to help 1 million people find greater success. I will help these million achievers through my speaking, writing, and online courses. Even as I write these words, I can feel the hairs on the back of my neck stand up with excitement, and the nagging thoughts in the back of my head asking, how? 1 million people is a lot of people. And that is where milestones come in.

   To reach 1 million people in the next 10 years, I need milestones to let me know that I am on track. Therefore my first milestone is to reach 100 weekly readers, then 500, then 1,000, and so forth. Each of these milestones is small enough to be attainable, yet each milestone drives the needle towards my BHAG. Of course, for a BHAG of helping 1 million people find greater achievement in their lives there will be many more milestones along the way. But starting small with a list of 100 is something that I can achieve in the short term. It’s something that I can celebrate. It’s something that will motivate me to hit my next milestone of 500 subscribers.

Where to begin with your Milestones?

   When getting started with any new goal, it is important to provide yourself a quick win. It would be entirely logical to say 1,000,000 divided by 10, is 100,000 people impacted per year. But when starting from 0, even that seems like a big goal. Since success breeds more success, the first 100 will be harder than the first 1,000, and so on. As I build momentum, recognizing what works, and what doesn’t, I’ll be able to refine my strategies.

More Milestones in Action

   Assume you set a career BHAG to become a Director of Sales in 10 years. Starting in an entry level inside sales role, your next milestone isn’t to become a Director. Your next milestone is to develop the skills that will help you succeed as a sales executive. Once you have the skills to succeed at the next level, you will be able to effectively grow into that new role. Hitting that milestone, celebrating, and setting your sights on the next set of skills that you’ll need. In that case, it might be better communication and leadership skills. Step by step, milestone by milestone, you will progress towards your BHAG, refining your process and abilities as you grow.

What is Your Next Milestone? 

   Now it’s your turn. What is your BHAG? Now what one small win can you achieve in the next 1-3 months that will help fuel that fire inside of you? That quick win is your first milestone, followed by the next win, and the next. As you grow and develop, that mountain of a goal you originally set seems to get smaller and more surmountable each step of the way.

   As you knock milestones down, you become more of who you were meant to be. And that’s certainly something worth celebrating!

What is a Good Credit Score?

   Credit scores are extremely important in your financial life. Understanding what they are, and how they are calculated is important. But even then, what qualifies for a good credit score? And what about the other end of the spectrum, what is a bad credit score?

The FICO 8 as a Credit Score Benchmark

   While there are a few different credit scoring formulas, one of the most common is the FICO 8 score. Your FICO 8 score will provide a very close estimate to where you stand among all credit scoring methods. This is important to note, since when you retrieve your credit score from one of the different credit reporting companies, the number they provide should be close, but will not be exactly the same. This is partly because they are likely using a slightly different formula than the FICO 8. For that reason, using the FICO 8 as a benchmark will provide a very close approximation of your credit worthiness.

What is a Good Credit Score?

   The FICO 8 score, and all credit scores, are broken roughly into the following bands: Poor, Fair, Good, Very Good, and Excellent. A good FICO 8 score is in the 670 - 739 range. Individuals with scores in this area are generally not turned down for loans, and shouldn’t experience too many financial roadblocks. Unfortunately, the reverse is true. Individuals scoring below 670 may experience difficulty finding a credit card, and will pay higher interest rates on their loans. This is in addition to the other non-financial aspects, such as experiencing more barriers to job markets. The chart below shows the ranges of the FICO 8 score.

Chart showing credit score ratings

Better than Good

   A Very Good and Excellent credit score is even better than good (obviously). Individuals who achieve this range of credit score generally receive more favourable interest rates on loans, and have greater access to debt. Entering this level, over 740, will result in better financial options, and hence make your journey to financial freedom even easier. If you have an interest in achieving financial freedom in your life, there’s a good tangible target to shoot for: a credit score over 800.

What is holding you back from achievement?

   When we set goals, we identify a future state that we want to bring into existence. Whether that is a slimmer waistline, a healthier bank account, or a more fulfilling job. This vision for the future provides us hope, and the strength to overcome difficulties. But even knowing where we want to reach, often times we fall short of our stated goals. Why? What is holding us back from achieving our dreams?

The Achievement Problem

   When setting goals, it is important to have a clear vision of the future. But equally as important, we have to recognize where we are right now. A goal is the way to bridge the gap between your current state and your future state. The achievement problem often arises when the bridge simply isn’t long enough to span the gap, often because our current reality is distorted. In these cases, we assume we are further ahead than we actually are, and after the first few weeks or months of effort we become discouraged. Our reality catches us to where we thought we were starting from, but you don’t feel any closer to your goal.

   For example, our health is a common goal that many of us set. We plan to shed those extra 5 (or 15) pounds. And so we begin, our current state is 5 pounds heavier than our goal state. After a few weeks at the gym, sure you feel a little stronger, but the scale hasn’t moved an inch. Maybe the gym just isn’t for you? It sure is a lot of work, and for what? Where are the results?

   In reality, that gym has made you stronger. And your muscles are developing, but that doesn’t immediately move the needle on the weight scale. The true current state is more complicated than a simple number. It takes into consideration movement in your daily routine, your diet, your sleep schedule. All of these factors contribute to those extra 5. And all those factors need to be considered when looking at your current state.

The Gap Analysis

   To effectively plan for achievement, you need to consider all of the factors impacting your current state, and all of the limiting factors that need to be overcome to reach your desired state. The difference here is often a wider chasm to bridge than you first recognize. 

   Identifying where you are, where you truly are, and where you want to be is called the Gap Analysis. The objective is to list out where you are right now, and everything that is holding you back from achieving more. This won’t be easy, or comfortable, but it is necessary if you want to overcome your obstacles.

   With some deeper thought, you can conduct your own gap analysis, understanding where all the obstacles are that hold you back from achievement. Once you’ve identified the obstacles, only then are you ready to develop an action plan to bring your goals to fruition.

Overcoming Obstacles and Achieving More

   What is holding you back from achieving more? The obstacles that you don’t consider are often what trip you up. Spend some time performing a thorough Gap analysis, and you will have the list of challenges to overcome. Quite often simply recognizing these challenges exist is enough to build counter measures, to make small adjustments to succeed.

   In our gym example, this could be a more comprehensive plan that involves an extra 30 minutes of sleep a night, a couple more glasses of water during the day, and a 30-minute walk at lunch. These minor changes build up over time, and magnify the efforts that you put in at the gym. Soon enough, those pesky 5 pounds were last years’ problem.

   Where are you right now? What is the gap between your current state and your goal state? Once you know the gaps, you can more easily build the right bridge, carrying you up, over, and to the brighter world on the other side.

What is a Credit Score?

   Credit scores can make our lives easier, or vastly more complicated, depending on our rating. But what are these credit scores? How are they calculated? How are they used? And, where can you see yours? 

What is a Credit Score?

   Credit scores are a measure of your financial trustworthiness. Based on a sliding scale between 300 and 900, the higher your credit score number, the better. Put simply, a high credit score indicates to lenders that you are less-risky, and that you have a good track record of paying your debts. Different reporting agencies have different calculations, and even different scoring ranges, but in general a high score at one agency will match a similar score from another agency. As a result, finding your credit score from a single agency will give you a good indication as to where you stand.

How are Credit Scores calculated?

   Different agencies calculate credit scores differently, and even the calculations are proprietary and not known for certain. That said, the most common scoring calculation used is the FICO score. In general the FICO score can be broken down into 5 core areas, generally weighted as follows.

  • 35% Payment History
  • 30% Amount of Debt
  • 15% Length of Credit History
  • 10% New Credit
  • 10% Credit Mix

   While this isn’t an exact formula, it’s a good estimate as to the most important criteria. Each category influences your credit score. Let’s look at how it all stacks together.

Payment History

   How well you have paid your bills in the past is the biggest influence on your credit score. Are you paying everything on time, every month? By routinely making your payments for all your bills, you indicate to lenders that you are reliable, which drives your credit score higher.

Amount of Debt

   The amount of debt you have, and the amount you use also plays a role. In general, you want to be below 20% of your total allowable consumer debt. For consumer debt, credit card limits and lines of credit are the most important types. It is important to make the distinction between types of debt here, since mortgages and auto loans can be rather large, you won’t be adversely penalized for using them, despite throwing off your total debt usage ratio.

Length of Credit History

   How long you have had an established credit history impacts your credit score. The longer you have had credit available to you, the better your score will be. This of course impacts young people and immigrants the most, as they haven’t had the time to establish their credit history yet. 

   Another consideration in this area comes with cancelling sources of credit. For example, it might be beneficial to hold onto your oldest credit card or line of credit even if you don’t use it anymore because it proves you have a longer credit history.

New Credit

   Applying for new credit can drive your credit score down. This is seen as risky behavior, as you obtain new sources of credit in a short period of time. As you prove that you can manage the level of credit that you are eligible for, your credit score improves. Again, this doesn’t mean that you shouldn’t find new sources of credit, indeed there are good reasons to change credit cards, etc. But, making a lot of changes at once might make you appear more of a credit risk, and your credit score will adjust to reflect that.

Credit Mix

   The final element is credit mix, or the types of credit available to you. Having a diverse array of credit options improves your score. This can be a combination of auto loans, credit cards, lines of credit, mortgage, etc. Being able to effectively manage multiple sources of credit indicates to lenders that you are financially responsible, and your score is higher as a result.

How are Credit Scores used?

   Arguably credit scores are the most important number in your financial life. They impact everything from housing rent and job applications, to the interest rates you pay on loans. Your credit score can even impact your relationships, with studies showing that your credit score can even impact your dating. 

   Credit scores are used as a measure of your financial risk. A lower number indicates that you are more risky, and therefore lenders demand a higher interest rate to account for the increased risk. This means that being financially responsible isn’t just good practice, it’s also saves you money! The difference of a fraction of a percent on large items like auto loans or mortgages can mean thousands, or tens of thousands of dollars in savings over your life.

Where do you find your Credit Score?

   You are entitled to a free copy of your credit report each year from each of the credit scoring bureaus. For our US readers, you may request your credit report here:

https://www.annualcreditreport.com/index.action

For my fellow Canadians, you may request your credit report from Borrowell here:

https://borrowell.com/

   Knowing how credit scores are calculated, what your score is, and how to find it is important. This three-digit number can have quite an impact on your financial future. As with any scoreboard, why not try and set the highest score you can? Your whole financial life will be better for it!

The little things

The little things matter as much as your greatest accomplishments.

   The beer was flowing at a recent company evening social, just like any other. But this evening was not like any other. We were there to say farewell to an esteemed colleague, Greg, as he parted ways with the company. Over the past half decade, Greg reshaped the sales division of the company, and led the team to double digit growth year over year. His list of accomplishments was long, between bringing in some of the largest deals the company had ever sold, to entering new markets internationally. But this evening, as those who worked closest with him gathered to say thanks, none of those accomplishments were mentioned.

   Instead it was the little things that people reflected upon. 

   His cheerful demeanor, always quick with a smile. The way every situation was a learning experience, even when a prospective customer slipped away. Or the best practices and recent wins shared each weekly meeting. The way each team member felt valued and respected, regardless of their experience.

   Greg’s influence could be felt throughout the team, and that team, his team, had grown and prospered because of it. All because of the little things.

What are your little things?

   Much as Greg was remembered for the way he showed up for his team each day, you too will leave your mark not just through your grand accomplishments, but also through how you show up. These daily behaviours, the little things are what people cherish about you.

How are you showing up?

   Just as we cherish the little things that makes others who they are, they cherish the little things you do that make you who you are. Take some time to reflect on who you want to be, how you want to be remembered. Now, how are you embodying those values and virtues that you have identified? What little things are you performing each day?

2020 TFSA Update

   For Canadians, the Tax Free Savings Account is an incredibly valuable investment tool. As the allowable contribution room that increases each year, anyone using this investment tool needs to be aware of the latest contribution limits. 

For 2020, the annual contribution increased by $ 6,000.00.

   If you have been over the age of 18 since the year 2009, your total lifetime contribution limit is $ 69,500. The chart below shows the annual contribution limits, and a cumulative total. To find your lifetime contribution limit if you were younger than 18 in 2009 (born after 1991), simply add the annual limits of all subsequent years after the calendar year you turned 18.

2020 TFSA

Contributions vs. Account Balance

   There has been some confusion about allowable contributions, especially when investments have grown. Contributions are considered independently of the account balance. This is especially important after the economic boom over the past decade. If you had investments that performed well over the past few years, it is quite possible that your account value has grown to beyond $ 69,500 already. This does NOT mean that you can’t contribute this year. As long as the amount you have contributed, your invested principal, does not exceed your lifetime contribution limit.

Example: TFSA Lifetime Contribution

   To highlight this, let’s look at Dominic’s situation. Dominic is a 30 year old Canadian resident, living in Canada on a continuous basis. Born in 1990, Dominic was 19 when the TFSA was introduced, and therefore has the entire lifetime contribution limit allowed.

   In 2019, Dominic received an inheritance, and invested all of his allowed amount into his TFSA, the full $63,500. His investments were predominantly stocks, and he saw significant gains over the year. On January 1, 2020, the balance in Dominic’s TFSA account was $ 73,000 - a gain of $9,500 over the year! Dominic hasn’t withdrawn any funds, but is concerned that his account balance is over the $ 69,500 lifetime contribution limit. Fortunately, as a BusinessMinded.ca reader, he knows where to go for information before making any rash decisions.

   Looking at Dominic’s situation, we see the following:

Lifetime Contributions: $ 63,500

Investment Growth: 9,500  

   Understanding that investment growth has no impact on lifetime contributions, Dominic can still contribute $ 6,000 in 2020. This will bring his used lifetime contribution up to the 69,500 limit, while increasing his account balance to 79,000 ($ 69,500 contributions + $ 9,500 investment growth).

TFSA: A Powerful Tool

   Understanding how a TFSA works is important for achieving financial freedom. Armed with the right knowledge, a TFSA will play an important part in your financial future. With $ 69,500 in cumulative lifetime contribution room in 2020, there are plenty of ways this powerful tool can be used to drive your personal financial success.

Where can I find more information about TFSA’s?

Read What is a Tax Free Savings Account?

How does this compare to an RRSP?

Read Which is better? RRSP vs TFSA.

How much will achieving your goals cost?

How much will achieving your goals cost?

   Knowing how to avoid the common pitfalls of achieving goals increases your chance of success. But there is one other often overlooked cost of achievement, and that is the financial cost of progress. For all of our goals or resolutions, there will be an impact on our bank account. Recognizing these costs will help you build them into your financial plans, and clear one last hurdle to your achievement.

What type of costs will you see?

   For my fitness goals, the gym membership will cost several hundred for the year. And while I have some gear already, continued use will ensure that needs to be replaced. By the end of the year, I expect to have spent $ 2,500 on gym memberships, workout clothing, running shoes, equipment maintenance, etc.

   As I progress my career goals, I will need to have the wardrobe for the positions I plan to be in. For new suits and dress clothing, $ 2,000. The courses and professional development that will get me to my career goals? Another $ 8,000.

   By now this is starting to sound like a MasterCard commercial, and that’s only considering the costs for two of my pillars. Once we add in social outings, date nights, romantic get-aways, journals, guided meditation apps, etc. The financial cost of all that I plan on achieving climbs even higher.

   Of course, achieving what I have set my sights on this year? Making this year my best year ever? That, is priceless

How much will achieving your goals cost?

   Setting the right goals will put you on the path to living your best year ever. But an important part of achieving your goals is to understand the costs associated with each of those goals. Here’s how you can be better prepared:

  • Pull out your list of goals
  • Under each goal, list what you’ll need to get there
    • A coach? Courses and seminars? A weekly entertainment fund? New gear / clothing?
  • How much do each of these prerequisites cost?
  • How much more do you need to set aside now, and ongoing, to ensure you can achieve your goals without undermining your financial foundations?

   Understanding the costs of achievement helps you plan accordingly. No matter the numbers you come up with, it is essential that you create the plan, and keep your eyes fixed firmly on the achievement of your goals. Because the cost is nothing compared to the value you’ll experience when you make this year your best ever. The value of that? Priceless.

Resolute Resolutions

   Have you decided on your New Year's resolutions yet? How devoted are you to achieving your goals?

   For many of us, the start of the year brings a renewed focus on our career, health, and financial goals. “This year will be the year I get in shape. This year I will get that career promotion. This year I will take control over my finances.”

   As anyone who has been to the gym that first week of January will tell you, it is crowded. People are committed to their yearly goals. But one by one, as the days go by people lose that firm grasp on their resolutions. Perhaps you  notice something similar when you look at your previous goal performance. Soon enough, as we approach the end of that first month, that crowded gym is back to looking just as it did before the new year began. 

Why do people abandon their goals?

   There are a few reasons why people abandon their goals. The most prevalent one that affects most “New Year New Me” people is overwhelm. Overwhelm assaults our good intentions in many different ways. That top 10 list of things they want to do differently in the new year, but if they were to stick with them all they would lose sight of who they are. Or that BHAG that isn’t set 10 years into the future, but rather 10 months into the future. Progress seems almost non-existent despite working exhausting hours, and suddenly that goal looks like we just bit off more than we can chew. Or life simply gets in the way. How many good intentions have faded away after life throws us a curve-ball, an untimely illness, or a sudden vacation or work trip. Overwhelm has many weapons with which to cause us to falter in our quest for greatness. 

   Another reason is the goal is too vague. “Get healthier” doesn’t come with an action plan. Neither does “get a promotion”, or “be better with my money”. If you aren’t specific about the result you are wanting to achieve, it is impossible to put an action plan in place. And without an action plan, it becomes easy to talk ourselves out of doing anything.

   Finally, the inability to measure our progress hinders our ability to grow and develop. Without seeing if our actions are paying off, it is easy to rationalize that our efforts simply aren’t working. Certainly some things are easier to measure than others, but all of our goals should be measurable. Seeing progress will help us stay the course throughout the ups and downs of life.

How do you stick with your goals?

   Knowing about overwhelm, vagueness, and measurability is an important first step to overcoming those obstacles. But what can you do to ensure you actually achieve your goals? 

   To face overwhelm, you need to ensure you only have a few goals at a time. And these goals need to be ambitious, but achievable, in the time frame you allow. If there is no way you can achieve in that time frame, perhaps you need to allocate more resources to working on it, or shrink the goal, or extend the time frame. Keeping the goals in sight, yet achievable, will prevent some of the overwhelm. And finally, you need a contingency plan. It is easy to work at a goal when the sun is shining and you have nothing but free time. But what are you going to do when life gets busy, when things aren’t going your way? Knowing how you will adapt to life’s uncertainties greatly increases your chance at success.

   How else do you increase your chance at success? Specificity. You need to know exactly what you want to accomplish, and how you plan to get there. By getting specific in your goal, often you will also uncover the action plan that helps you get there. This action plan can be measured, and you can track and evaluate your progress even before you reach the prize. Specificity, being specific about your goal, clears up your vague intentions and provides you an action plan with which to measure progress. This clarity will set you up with the optimal chance of achieving your goals and resolutions.

   As you set your New Year’s Resolutions, or any other goal, make sure you are ready to combat overwhelm, vagueness, and measurability. By being specific in what you want to achieve, and building a contingency plan for when things go wrong, you will be well prepared to crush your next goals.

Setting your sights on 2020: Planning the New Decade

   Who are you going to become over the next decade?

   As we focus on our own growth and development, we can achieve incredible things. This achievement fundamentally changes us, as we recognize our capabilities and pursue new heights.

   There is no better time than now, the start of a new decade, to plan your next great accomplishment. This goal, the one that inspires you for the next decade, is your BHAG.

What is a BHAG?

   Pronounced bee-hag, the term was popularized by Jim Collins and Jerry Porras in their book, “Built to Last: Successful Habits of Visionary Companies”. This is where Jim and Jerry introduced the concept of Big Hairy Audacious Goals, or BHAG for short. These long term goals proved, in the corporate world, to be an indicator of exceptional company success. A BHAG has a way of motivating people, and reminding them of their overarching objective, in a way that a long-winded mission statement cannot.

   With proven success among corporate goliaths; think Apple, Google, Facebook, Uber, or Tesla, it’s about time we applied some of these world-changing principles to our own pursuits.

How do you set a BHAG?

   Big Hairy Audacious Goals have a few key characteristics that they must be:

  • Forward Looking - does your BHAG tell you where you’ll be in the future?
  • Exciting - does your goal fill you up with energy? Will it continue to inspire you for the years to come?
  • Adventurous - is your goal hairy and audacious enough? Is it big enough to keep you up at night? Or to wake you full of excitement in the middle of the night?

Examples of BHAG’s

   It is one thing to think of a company like Google (Alphabet), and their BHAG to organize the world’s information. Certainly, they have near unlimited resources to devote to their goals and ambitions. But can you set a BHAG for yourself, that would lead you to new heights?

   The answer is a resounding yes, we’ve all heard the stories of individuals who set BHAG’s for themselves; Thomas Edison in harnessing electricity to generate light (the light bulb), Alexander Graham Bell by sending near-instant communication across the Atlantic (the telephone), or Roger Bannister in his athletic achievement, breaking the 4-minute mile. These individuals all set Big Hairy Audacious Goals, and achieved things that changed the world.

   Often we think these successes were made by extraordinary individuals, but that simply isn’t true. These successes were achieved by normal folks, people like you and I, who had extraordinary goals.

   Let me ask you again, what BHAG are you going to set for this decade? Who will you become, as you grow into further success?

   I can’t wait to experience the future you are going to shape.

Closing out the 20-teens

   The holiday period is officially drawing to a close. With the end of the decade almost upon us, it’s time to reflect on the past, and look to the future.

   Before we can take on the new year, we need to look at our successes and failures of the past year, of the past decade. Let’s take an inventory of what happened for you in your life. Answer the following questions, preferably by writing down the answers, but at least reflect on them and learn from your past failures and successes.

  • What were your goals on January 1st, 2019?
  • What wins did you have over the last year?
  • Were your wins on your list of goals at the start of 2019?
  • What helped you accomplish those goals and wins?
  • Who was most influential in your successes? Send a quick thank-you to that person(s).
  • What were the goals you didn’t accomplish?
  • Are there any lessons you can learn? Why were you unsuccessful at achieving some of those goals?
  • How can you be better prepared to accomplish your next set of goals?
  • Who can help you along the way?
  • Who can you help accomplish their goals?
  • What are you most grateful for over the past year?

   Success is a journey with it’s own ups and downs. Taking time to reflect on what has gone right, and what hasn’t, ensures that you are continually learning and growing. That growth makes you better tomorrow than you are today. As you learn, grow and develop more, there is no telling how far you can go. The world is yours for the taking, seize it!

How to use your Emergency Fund: Best Practices

   An emergency fund can save our hides in an unexpected event. That safety cushion can be used in an emergency, or as an opportunity fund. But using the fund is only part of the equation. We also need to replenish it, or risk going into the future financially exposed.

When is it okay to use your emergency fund?

   Sometimes unforeseen events happen that put a strain on our finances. For these situations, we can dip into our emergency savings to prevent us from having to borrow money from other sources, like bank loans and credit cards. Our savings are designed to protect against the struggles of life, designed to make our financial position stronger and safer.

   In general, your emergency fund is there to help with the one-time expenses that creep up on you. A car accident not covered by insurance, a medical emergency, or unexpected travel. Anything sudden that causes you to deviate from your current financial plan can be covered by your emergency fund. But be careful that the expenses that come up are really one-time items, and that you aren’t dipping into your emergency fund for everyday purchases. If that’s the case, your expenses are creeping too high and you’re in danger of living beyond your means. And that is a very dangerous road to travel. 

   You also could dip into your emergency savings for once-in-a-lifetime investment opportunities, after appropriate due-diligence of course. You don’t want to chase too good to be true promises with your financial safety net.

What do you do after you’ve used your Emergency fund?

   What’s next after you use your emergency fund? Whether it is to cover financial shortfalls from a real emergency, or simply taking advantage of an exceptional opportunity, that money has come from a loan. You have loaned yourself funding to cover an extraordinary item, but make no mistake, you are still in debt. The only difference is that instead of borrowing from a bank or other source, you have borrowed from your future. 

   If you do use your emergency fund, you need to treat it as you would any other debt, pay down aggressively until you are debt-free, or in this case, until your emergency fund has been restored.

   In the few times I have needed to resort to using my emergency fund, I treat that loan as equivalent to one my bank would offer me. That means that I charge myself interest on the loan I made to myself. As I pay down that loan, I also pay “interest” into my emergency fund, meaning my fund is larger than it started, and I have an even larger safety net to cover future financial shortfalls. 

   Using your emergency fund is okay, especially in emergency situations. That is afterall why we put those extra dollars aside. But when we do use our emergency fund, we need to remember that we are loaning that money to ourselves. When we consider the use of our emergency fund as going into debt, we think twice about using the money. If our cause is truly just, and we need to use our safety net, thinking about it as a loan also ensures that we pay it back quickly. That way we return to a state of equilibrium, where we protect our financial stability from the unexpected future.

Doors of Opportunity

Are you ready for opportunity when it comes your way?

   If you want to achieve more than what you currently have, you need to be ready for the next level. This is true in all areas of our life, but especially in our careers, our life's work. But to be ready, to be truly ready, it takes more than passive development. We need to be actively involved in our growth.

How can you be actively involved in growth?

   To be actively involved in your own development, you need to focus on developing the skills that you need to take yourself to the next level. Identify what skill you want to focus on, and then begin learning it. Reading books, taking online or in-person courses, attending seminars, and more. And the final aspect of your growth journey is sharing what you are doing, what you are learning, and where you envision that taking you.

Why share your development journey? 

   As you grow, you want to let the world know that you are becoming more than what you were before. To paraphrase a personal development legend, Jim Rohn. Sharing your growth journey is akin to knocking on doors, looking for the chance to showcase your new skills. Most doors will remain shut, people will scarcely pay attention to your journey, as they are so engrossed in their own struggles. But every once in a while, one of those unlikely doors will open.

"If you keep knocking, you'll find open doors." - Jim Rohn

   When a door opens, and you have the chance to shine, you must be ready. That is why it is important to set yourself up now to have the best chance of capitalizing on that opportunity.

What does this look like in practice?

   I have a work colleague who is currently taking accounting courses to expand her knowledge, pursuing her goals of becoming a designated accountant. She shares her journey, the courses she has taken, the courses she is taking, and where she thinks that will take her in her career. I have seen her journey, but can do little to aid her in any way right now. But, if someone were to ask me, a practicing CPA, if I know anyone who would be good for a junior accounting role, I know someone who is going, and growing in that direction. 

   By continuing to share her journey with other people, she is gently knocking on doors, looking for the next opportunity. And when that opportunity comes? She has spent many months developing skills that will help her take full advantage.

   This happens more frequently than you know. It is estimated that between 70 and 85 percent of jobs are filled through networking. This comes about by sharing your skills, what you are looking for, and how you are growing your professional expertise.

   As you look into the future of your life, your career, your goals, ask yourself; what skills you are going to need to take you to the next level? Who can you leverage to get you there? What doors of opportunity are you going to knock on?

   And remember as Jim Rohn said, “If you keep knocking, you will find open doors.”

Your Opportunity Fund

How much do you have set aside for emergencies?

   Common financial advice says you should be holding at least 3-6 months worth of living expenses in cash, just in case an emergency comes up. This should be a target of everyone’s financial plan, to save 3-6 months worth of necessary expenses, and have those funds stored in cash, readily available if you need them.

   Accepting that target savings amount can be hard, made harder still during periods such as the last decade. That seems like an awful lot of cash to be stored, especially when the markets are performing well. After all, isn’t it better to be invested in the market in the long term? Doesn’t that mean holding a large cash position is actually losing the opportunity for greater returns?

   The answer to these questions is yes, and maybe.

Let’s look into that further.

   Over the long term, every investment market has increased. That doesn’t mean that they increase every day, every month, or every year. But over the long term, they have gone up. Unfortunately, emergencies by their nature cannot be predicted. But neither can opportunities.

   And therein lies the beauty of your emergency fund. It is liquid cash, available for use at a moment's notice. If a once-in-a-lifetime investment opportunity arises, you have funds already available that allow you to capitalize.

   It has been said that fortune favours the bold. But courage alone is worthless without the resources and ability to act. It is time to reconsider how you think about your emergency fund.

   Think of your cash reserves as both preparedness for emergencies and for opportunities. This ensures you are not just ready for the worst case, but also that you are actively scanning for opportunities. 

What kind of opportunities exist?

   Just this month, a former colleague of mine was offered an opportunity to join a startup company. This opportunity brought tremendous upside to his career, but also introduced an increased level of risk. As part owner, some months he may even have to forego his paycheck to allow the company to chase bigger and more lucrative deals. Having a fund that allows him to take advantage of the opportunity without putting his financial position at risk is the purpose of his opportunity fund.

   Other opportunities exist all around us, if only we’re looking. A real estate investment opportunity to purchase into rental properties as part of an investment group. A company that the market over-reacts to bad news and their stock is temporarily under-valued. An opportunity to buy a rare and valuable art collection from an estate auction.

   These opportunities exist all around us, but not every day. When they do arise though, temporarily re-purposing your emergency fund and using it as an opportunity fund is a viable option.

   Keep saving, putting money into both investments and bolstering your cash reserves. And keep a weather eye on opportunities, because it isn’t about what could have been, but what could be. This is your future, and capitalizing on opportunities is a perfect way to make that future brighter.

Driving in a Blizzard

   Where are you heading? Can you see where you are trying to go?

   Earlier this week, I was driving on the highway, headed for a day of meetings out of town. Shortly after the sun went down, and darkness descended upon the roads, a snow storm moved in. At first the snow was fairly light, not really accumulating much. With a slow flick of the wipers, I was able to see where I was heading without much difficulty. 

   As time went on, the snow storm became more intense, until eventually I was driving in a blizzard. Even with the wipers fully cranked, my headlights reflected off the blowing snow making visibility nearly impossible. Suddenly I couldn’t see where the road was and where the ditch was. My progress slowed down as I let off the gas pedal, trying desperately to see where I was headed. And even at slow speeds, several other travelers still wound up off the highway and into a ditch on the side. Fortunately, with rumble strips on each side, at a slow speed I was able to continue driving along the highway, creeping ever slowly towards my destination.

   This night drive in a blizzard holds a few lessons about your journey to success.

Distractions will come.

   When visibility is clear, making that drive is quite simple. The roads are flat and straight, so setting your direction and staying the course eventually gets you where you are trying to go. But as with those first few snowflakes, distractions will come no matter your journey. Small pulls on your focus, an email here, a tweet there. Most of these distractions can be ignored when they are infrequent, and they don’t threaten to derail our progress.

   But if we let them, those distractions can pull away our focus, and we end up spinning towards a ditch.

There are cliffs everywhere.

   All along the highway, for hundreds of miles, ran the drainage ditch. Once again, if you have a clear objective, a goal, you can stay in your lane and progress easily. But when these distractions become too great, you will find it harder and harder to see where your lane is and where the ditch is. 

   Maintaining focus on your goal becomes harder and harder, visibility decreases amidst the endless distractions. Even maintaining vigilance over your goals and objectives might not be enough. Certainly none of the fellow travelers on that snowy highway were planning to end up spun out on the side of the road. They all had their own destinations, but without visibility over where they were heading, what they were trying to accomplish, they ended up derailed. 

You need rumble strips.

   What can you do to remain focused on your goals? You know that distractions will come. Certainly you can use different tricks and methods to deal with them. And those wipers work to help you maintain focus on your goals. But, there are times that visibility over your goal will shrink, when the distractions are too many and too great, and they threaten to send you spinning off track. That is why you need rumble strips.

   These rumble strips on the side of the highway were indicators that I was coming too close to the edge, that I was straying too far from the path I was taking. Once I heard and felt the vibrations that my wheels were at the edge, I knew I needed to correct my course. You also need rumble strips to keep you on track.

What do these rumble strips look like?

   Creating barriers helps you stay on track. This means you need to know where you are heading, and what it looks like when you are getting off track. With holiday festivities just around the corner, some of the major areas of our life will begin to get hectic, with distractions threatening to overwhelm our goals. 

   My rumble strips are therefore designed to give me an indication that I am falling off track. For fitness, I track the number of days that I miss the gym. If that number reaches 2, I know that on the third day I need to workout, or risk losing the health gains I have worked so hard for. My financial indicator is the amount of money I contribute to my investments each month. (This is easier to hit, because my financial goals are automated.) Or my career indicator is the amount of time I spend reading in an area of focus for me. Similar to my health goals, if I spend more than 2 days without reading and developing myself, on that third day I know that I must allocate time to personal development.

   We all face distractions, the blowing snow of life that pulls us away from our goals. Maintaining focus is essential to dealing with these distractions, but sometimes even that isn’t enough. Sometimes we need indicators that let us know when we are falling off track. Setting up indicators in your life will ensure that you are making progress towards your goals, regardless of how hectic life gets.

   As we enter the final few weeks of the year, take some time to reflect on what your goals were. Are you still focused on them? What are the distractions that you need to control? Where do you need windshield wipers clearing away the snow? And what rumble strips will you implement to ensure you aren’t spinning off into the ditch? 

   With the right focus and the right systems, you can reach your destination no matter how bad the blizzard of life is.

Where should you invest your money?

We’ve all heard advice from friends and co-workers, “You need to be in the market.” More often than not, they are referring to the real estate market, with their never-researched philosophy that real estate is the best investment.

Unfortunately, this “be in the market” advice is rather misleading, as there are a wide number of investment markets you can participate in. Furthermore, the actual annual returns from various markets often switches each year. Putting this together, it simply means that there is no one “right way” to invest your money to guarantee top returns.

Here are 5 of the common markets you can be in:

Equities

Referring to stocks, the equities markets are the most common investment. An equity, or a share, refers to an ownership interest in a publicly traded company. As a shareholder, you are entitled to a portion of the company's growth and earnings. As a company does well, you can experience investment returns through dividends, earnings being paid to shareholders, or through stock appreciation, the company becoming more valuable which makes the price of the share(s) you own increase.

As a subset of this market, there are various funds and Exchange Traded Funds (ETFs) that hold a collection of shares from different companies. You can buy into these ETFs, and thus own a collection of different companies. This way of investing is extremely popular these days, as it allows you to own a diversified stock portfolio as a low cost of entry.

Fixed Income

Fixed Income investments are debt loans you make to others, usually in the form of Bonds. Most commonly these borrowers are governments and large corporations, who are reasonably certain to pay you back the loan. The structure of these investments is that you provide up-front capital, and the borrower pays you back interest over time, and your principal is returned to you at the expiration of the loan.

When considering loaning money, or buying bonds, you want to be compensated for the risk. This is often seen when purchasing a government bond, as most governments in the developed world are stable. Knowing that the US or Canadian government will still be around in 100 years, you can be fairly sure that your money will be returned to you. With this lack of risk, the amount of interest is fairly low.

With the advent of the internet, there are also peer-to-peer lending sites popping up. These sites allow you to loan money to other consumers. Since these debtors (people borrowing money) are an unproven entity, the interest rates are higher to compensate you for the risk that some of these debtors won’t ever pay back the money you loaned.

Commodities

Another common investment is in commodities, which we hear about in the financial segments on the evening news. While there are many commodities, most commonly we hear about the price of oil and gold. Since these are used in production, you can invest, or buy rights to, a certain amount of these materials. The objective is of course to buy when there is excess supply, and sell when the demand is high.

Given the cost and scale of purchasing aluminum or copper, cattle, oil, etc these markets aren’t quite as accessible to the general consumer. For many of us, to invest in the commodities markets we would need to use a financial instrument called a derivative. These complex financial instruments are best left for another time.

Foreign Currency

Another form of investment is in foreign currency. With the global nature of trade, the cost of currencies fluctuates as goods and services are performed internationally. This causes currencies to be worth more, or less, relative to each other. These fluctuations provide an opportunity to buy and sell currencies to make a profit.

Most currencies are pegged to the US Dollar, and these fluctuations are directly impacted by economic performance compared to the US. Trade between countries has a very strong impact, which means that the number and level of tariffs can dramatically impact the fluctuations of currency. For example, government policy replacing NAFTA with USMCA will impact trade in North America, and that will cause currency fluctuations.

Physical Assets

Physical assets provide another option for investing. This is where you buy an asset that will make you money. This includes real estate as an investment, where you will buy property and rent out its use to generate income. Over time, the asset may become more valuable, which will allow you to sell at a profit.

While real estate is by far the most common example of a physical asset, there are also specialty markets for a wide variety of assets. It could be as simple as buying and renting out a camera lens to make money. Or a sports cards / stamp collections. Or exotic cars. Or artwork.

The purpose of investing in a physical asset is that it allows you to generate income through rental, or investment returns through increases in value. The key distinction between investing in an asset and simply buying stuff (being a consumer), is that the asset is expected to go up in value or provide a financial return while you own it.

Where should you invest your money?

There is a long list of ways you can invest your money, with these 5 being some of the most common. Equities means buying ownership in a company, fixed income is loaning money to generate interest income. Commodities and foreign currency trade on supply and demand, impacted by global trade and government policies. And physical assets provide an extremely wide range of options to invest money in valuable items, such as real estate and artwork.

With numerous markets, and a wide variety of options, you can truly create your own financial adventure. BUT, the most important aspect of investing still remains the same;

You need to be investing now for your future. 

Where you invest is up to you. But don’t be scared by the doomsday sellers promising you that if you aren’t in their chosen market that you will lose out. 

There are a lot of investment options out there, make sure you are participating in some of the different markets on a regular basis. With regular, disciplined investing, no matter the market, financial freedom can be yours.

Finding Your Purpose

   Are you doing something you love? Do you wake up feeling energized and excited to keep going (most of the time)? 

   A staple in almost all motivational talks, at some point you will be told, Live your life with passion. While that sounds exciting, what does that really mean? And more importantly, how can you do it?

Live with Passion

   Living with passion really boils down to liking what you do, who you do it with, and who you do it for. Finding people that you care about, and that care about you, is an important step in living with passion. The good news is, you already know these people! These are the people that you already spend your time with, friends, family, community members. 

   The people in these areas that you enjoy spending time with are the people you should spend more time with. And those who you aren’t excited to see? Spend less time with them.

   When you take control over who you are spending the most time with, those energies feed the rest of our lives. We all have people in our lives that, when we’re with, we have excitement and energy, hope and enthusiasm. Spending more time with these people puts us in a better state, and our results are impacted positively. On the flip side, we also know people who have the unnatural ability to suck the air out of an already deflated balloon. We feel exhausted just entering the same room as them, and that also affects our results, but in a negative way. 

   If you want to live with passion, start by simply spending time with, living with, people that light you up inside.

   You know who you want to spend time with, and how much more energized you feel when interacting with those special groups of people. Now what are you doing to find purpose and meaning?

How do you find your purpose?

   One method that I found particularly helpful was in examining what I talked about with those people that light me up. What problems did people come to me for advice for? Where did our conversations naturally lead to?

   For me, these topics were focused heavily around a few core areas; personal finance, career growth, and health and fitness. These were the areas of life that I had a natural affinity for, or at least an interest that led to the pursuit of knowledge. Finding these areas of interest led to the eventual creation of Business Minded, and you reading this article right now. These areas that I talked about with my friends and family, they are important to many people. And the people who value growth in their careers, who value healthy living, and who value smart financial strategies? These are the people who light me up.

   Most of us already know who we like spending time with, and what we like doing. But taking the time to reflect on these elements can help us aim the direction we want to take our own lives. When was the last time you thought about the direction you were headed in life?

Action Items:

Take some time this week to reflect on your passion and purpose:

   Who do you enjoy spending time with? Who lights you up inside?

   What do you do when you are with these people? What do you talk about? What topics interest you? What problems do people come to you to help solve? 

   If you want to find your purpose, to live with passion, you need to do the things you enjoy, with the people that light you up. Find alignment between those two elements, and not only will you find fulfillment, but the world will be better because of it!

‘Tis the Season of Giving

   The holidays are upon us, and with it comes the inevitable bombard of requests from various charities. There is not enough money to donate to everyone, so how do you decide who makes the cut, and who doesn’t?

   The motivational Jim Rohn, an iconic figure for personal finance advice, said to allocate 10% of our incomes to help those less fortunate. Charity is a way of giving back to the world and society that shaped us, and allowed for our success. While 10% is not a requirement nor a maximum limit, we all are constrained by how much we are able to give.

   While it can be hard to say no to people in need, it is important to stick to our financial plan, even when it comes to charity. With hundreds of worthy causes, we need to identify the ones that speak to us directly.

Who makes the cut?

   This is a very personal question, which you must answer for yourself. Often the causes we support are ones we hold near and dear to our hearts; a loved one is sick with a rare disease, or we have a soft spot for furry four legged creatures. Whatever the cause, staying true to who you plan to help will enable you to give more generously to those causes that speak to you.

Avoid the Guilt trip

   We’ve all been there, walking into the grocery store, and someone approaches you. They spill out a long sad story of a family in need this holiday season. But you can be the hero, you can help them with just a few dollars!

   It’s a very sad fact that others in our society are struggling to get by on a daily basis. But you can’t save them all, and sooner or later you are going to have to say no, not today. The charity fundraisers will do all they can to make you feel guilty for “turning your back” on others. This is why you need to know what charities you support, which ones are going to receive your donations. Knowing that you are helping a worthy cause helps prevent those feelings of guilt that you have as you walk away from yet another outstretched hand. 

   The important thing is that you know who you want to support, which causes are just, what aid you can provide. There are many others just like you, each who have their own causes. While you may be trying to save the whales, let someone else save the children, and another save the trees. We can’t change the world alone, which is okay, because we aren’t alone. There are millions of other people out there doing their part to make the world a brighter place. And knowing that, you shouldn’t feel guilty, instead you should feel proud of the ray of light and hope that you can cast on your worthy causes. 

   Give generously to the causes you support this season of giving, and feel proud in the knowledge that you are doing your part to make the future just that little bit brighter.

Be a Detective

   Be a Detective. This isn’t advice on a career path, but it certainly falls under career advice. We are taught many things when we are younger, and one such lesson is to analyze what went wrong in any given situation. This is good advice, and it is a good lesson to learn. Unfortunately, that is only half the lesson. 

   The other half of that lesson - to analyze when things go right as well.

   Learning from our shortcomings, from our failures, from the times we stumble and fall just short of the finish line. These moments provide valuable lessons. But if you’re anything like me, you won’t fail all the time. You will have your moments in the sun. These moments need to be looked at just as hard, perhaps harder even. You need to analyse what does go right, and learn from those experiences. 

   What went right? Why did it go right? How did it go right? Ask questions. Find the answers. It could be as challengingly simple as surrounding yourself with the right people. (Yes, it sounds so simple, yet often is so difficult.) Maybe it was your plan, executing on it just a little bit each day. Or maybe it was taking that pause, considering the outcomes, thinking first and then acting with decisive movements. Success comes in many different forms, in as many different ways, but each success carries with it a valuable lesson, if you’re looking for it.

   And don’t just look. Apply those lessons. We all know of people who seem to be in the zone constantly, people who have the magic touch, where everything they touch turns to gold. That is what happens when you figure out what you are doing right, and then doing more of it. 

   So analyze your failures, learn from your mistakes. A lesson learned will turn any complete and utter disaster into a minor victory, lessening the pain just that little bit. But just as importantly (if not more so), analyze your successes. Learning from those experiences, and applying those successful habits and practices will set you up for more success in the future. Find your sweet spot, your zone, Be a Detective, and never, ever, stop learning.

How much are you spending this Holiday season?

   With Black Friday kicking off the holiday buying season, how much do we actually plan on spending?

   Recent reports by PWC, CPA Canada, and the Retail Council of Canada (as reported by CTV news) indicate that we are in for an expensive month. Canadians are planning to spend $ 650.00 on gifts alone this season, with travel and entertainment adding an extra expense for many Canadians. This all adds up to an estimated spend of over $ 1,500.

   While the numbers alone aren’t cause for concern, the surveys also report a few other more alarming statistics. 46% of Canadians won’t be planning out their spending over the holiday season, and in a Manulife report mentioned by CTV news, 60 percent of consumers are willing to go into debt over the holidays.

What does this mean?

   The old adage “Failing to plan is planning to fail,” might be applicable here. Without a general sense of how much you are planning to spend, it is hard to save for the holidays ahead of time. This leads to loading up the credit cards, and paying far more than you planned once those interest bills start coming in.  

   Putting a plan in place, and sticking to it, can avoid some of the nasty surprises that January usually brings. Since Christmas comes fairly reliably every year on December 25th, it would make sense to allocate some dollars to the gift fund throughout the year. Automatically contributing each month to a small gift fund will help ensure that you always have the resources to show your love and appreciation to those you care about.

But it’s too late for me now!

   Let’s say you don’t have a gifting fund already set up, and the holiday season is upon us already. What can you do? 

   There is still time to put a budget in place! Speak with those loved ones that you plan on exchanging gifts with, and work out a reasonable budget. This helps you both out, by taking the guess-work out of how much should you spend, and lets you focus on what you want to give. 

   And if you do need to take on debt this holiday season, make sure you pay off your credit cards in full each month. This will ensure that your high interest debt doesn’t end up costing you far more than you planned to spend on the gifts. 

   The holiday season is supposed to be full of love and joy, don’t lose sight of that amidst financial concerns. The right plan can help you get through this season with a full cup of holiday cheer!

How do you remain focused on your goals?

   Achieving our goals is critical in our pursuit of becoming better versions of ourselves. But with the constant drags on our attention, how do we remain focused on our goals versus tackling the latest urgent problem that needs to be dealt with? 

   These problems assault us constantly, threatening to derail us from our objectives. The urgent work problem that requires us to put in overtime, rippling outward and disrupting our evening schedules and bumping gym-time off the daily agenda. These urgent problems of now war and rage against our dreams of a brighter future. 

   This situation came up in one of my coaching calls recently, as fitness goals started collecting dust on the shelf, while my client was putting out the endless fires at work and school. As days went by, losing the momentum of consistent action, the question was raised: 

How do I remain focused on my goals when life is pulling me a thousand different directions?

   The resulting discussion revealed a couple of areas that we all fall prey to. The first was the desire to do better, expressed as a hope. 

“I hope to get back to the gym next week.”  

   When we began looking into this desire for improvement more, it seemed that hope wasn’t the right word. Hope could be trumped by being busy, hope could lose out to not feeling like it, hope wasn’t a strong enough commitment. 

Don’t rely on hope.

   To remain focused on your goals, you must first tell yourself what you must do, not what you hope to do. These are called non-negotiables. When pursuing your goals, you need to make them non-negotiable, they will be done, no matter what.

   For myself, a couple of my non-negotiables are reading and working out. I try and have these done in the morning, so that I don’t give myself the opportunity to be distracted first. My time table works for me, but it doesn’t work for everyone. But the principle is the same, what are your non-negotiables? What are the steps that you take towards your goals each day? And will you commit, that you won’t end your day without taking those steps?

   That commitment makes your goals non-negotiable.

   There is another aspect of uncertainty held in the statement, “I hope to get back to the gym next week.” This is the lack of specificity surrounding when this gym time will occur. It is one thing to say “I must do this each day.” And another thing entirely to give those plans a set time and place. 

   When we have a meeting, or a scheduled time commitment, we almost always show up. By scheduling time for your goals, you are declaring that nothing else can take up that time. This means your non-negotiable is on your calendar, planned, and ready to be acted upon at that time.

   Going back to my morning, at 7:15 am every working day, I walk into the gym. This is my non-negotiable, and 7:15 am is the time that I have allocated to my fitness goals. Do you know what your non-negotiables are? What steps you need to take to achieve your goals? Do you know when, and where, you will be to take those steps towards success?

   By determining your non-negotiables, and scheduling them in your calendar, you are doing what it takes to remain focused. Because they are a must for you, you will take the actions necessary to drive achievement. There is no room for excuses, too busy, not enough energy, don’t feel like it. Those excuses, other people’s demands, the inevitable fires you have to put out elsewhere in your life; that all happens outside of your scheduled achievement time.

   The discipline to follow through with your non-negotiables is the key to remaining focused on your goals. And that discipline makes you unstoppable. Your achievement, the heights you will go, only you can say when you will stop.

Where are you spending your money?

   Do you think you could save some more money now for a brighter future?

   Many of us look at our current circumstances and believe that we’re stretched thin as it is. The moderate savings we make each month, that’s all we can afford. When we’re asked to find a little bit extra, our initial reaction is, I can’t do that.

   How well do you know your spending habits? Do you know where you are spending your money now? We often have a general sense, but when we get into specific details of where each dollar goes, the results are often eye-opening.

Get to know your spending habits.

   Becoming aware of your spending habits is quite easy these days, with the majority of our transactions occurring through credit cards and electronic payment methods. It is a simple, and not overly time consuming process to look at last months statements and learn where you are spending your money. 

   That knowledge alone can help you make better financial decisions in the future, and may even uncover some areas for additional savings.

   But you can take that process one step further, by becoming proactive versus reactive to your spending. 

Becoming Proactive in your Spending

   To become proactive, you need to be putting thought into your purchase decision, and what that means, before you actually swipe your credit card. One highly effective strategy to do this is to carry around a small notebook, and before every purchase write down what you are spending on, and the amount. This notebook will put a small interruption between the usual tap-and-go buying that you are habitually used to. That brief pause gives you time to reflect, do you really want or need that candy bar or bottle of pop?

   Our financial goals are usually not derailed my large decisions, rather they suffer death by a thousand cuts. It’s the small, habitual purchases that we make that robs us of the extra few dollars each week to contribute towards our financial goals. By tracking, especially proactively by using a notebook, you take back some control over your wallet. That small, powerful step puts you back in charge of your financial destiny. Financial freedom is yours for the taking, if only you get out of your own way.

Flippin’ Success

When do you become successful?

   Is there a certain mark, a single accomplishment that, once reached, signifies that you are a success? 

   To most single people, finding a loving relationship would be an appropriate goal. But with divorce rates skyrocketing, simply entering into a relationship cannot be sufficient to call yourself a success. As any married couple will tell you, the hard work begins after the wedding day, and every day from then on. 

   If success in your relationships isn’t found in a single act, in one defining moment, where does that success lie?

   This question applies to all areas of our lives. To our friendships, our financial health, and certainly our physical health. Have you ever looked at pictures of someone losing weight? Or even looked in the mirror every day as you strive to fulfill this years’ resolution of going to the gym 5 times a week? Just like a flip book, the image changes almost imperceptibly each day.

   When does that overweight person on the cover of the flip book become healthy? Is it on page 6? Page 49? Page 152? If we compare the pictures one page to the next, they look almost identical. Even comparing one week to the next provides almost no visible change. But as we flip through those pages quickly, the change is definitely noticeable.

   This is very much similar to how we view success in our own lives. We step on the scale each morning, and beat ourselves up for seemingly no progress after a grueling workout the day before. We frown at our bank account, barely increasing since the last time we got paid. Or we become frustrated in our careers because we’re doing similar things as last month, as last quarter. 

   Taking a short term view of our accomplishments is frustrating and unrewarding, but it’s what so many of us do. As such, we never feel like we are becoming successful in our pursuits. These feelings lead us to thinking we’ll never become successful.

What is the solution?

   We need to expand our frame of comparison. We can’t look at our progress today, compared to where we were yesterday. We need a wider lens to view our success. With my coaching clients, we take a deeper look at progress every quarter. This 90-day lens allows us to see real progress, that we wouldn’t be exposed to when only looking daily or weekly. Seeing progress is important, for two reasons. First, it allows you to make adjustments, to see what is working, and what isn’t. And secondly, seeing progress feels good. We all like to know we’re improving, that we’re going somewhere, and taking a wider lens to view our efforts provides that reassurance. 

When do you become successful?

   Surely there is no date, no grandiose accomplishment that says “I made it.” You become successful by making sure each day you are working towards your grander goals. Each small, almost imperceptible step is a success. And remember, to see those successes add up, don’t look at yesterday’s results, but expand your lens. Achieving anything worthwhile is a slow process, but by taking a small step each day, you can achieve your dreams.

Why You Need a Will Now

Is your family protected in the case of your death?

   You work hard to take care of your friends and family, that’s why you have taken an interest in achieving more. But what if the worst happens, and you aren’t around to support your family and community further? This is where a will becomes essential, to ensure what you worked hard for in life goes to where you want it to after your passing.

What is a Will?

   A will is a legal document that tells the courts what you want to happen to your property, and the care of any children still considered minorities, in the event of your death. 

Why are Wills important?

   Without a will, your property and any young children will be assigned to the courts to deal with. This creates a lengthy, time consuming, and often expensive process. Furthermore, disagreements over your property causes more stress on loved ones, and can result in fractured relationships as well as your property being distributed in a way you wouldn’t want.

   A will helps alleviate these issues, by telling the courts exactly what you want to have happen with your property. Through this document, you can allocate bank balances, property ownership, and distribution of family heirlooms to different people. You are also able to donate to charities or institutions. By creating a will, you are also able to create tax savings through gifting allowances, etc. This ensures more of the assets you gathered through your efforts are given to the right people, and less is lost in estate taxes to the government.

   Perhaps the most important aspect for parents of young children though, is the ability to direct who will be caring for your children in your absence.

And if I don’t have a will?

   If you don’t have a will, a probate court will assign an administrator to consolidate the value of the estate, and disburse the property and assets based on court decisions. This almost always splits the estate among the surviving spouse and children, if applicable. If neither of these options is available, the government takes ownership of the estate.

   Aside from stressing the relationships of surviving loved ones, a court appointed administrator must follow certain formulas and rules for distributing the assets of the estate. This could result in the family home being given to someone you wouldn’t have intended, or even forcing the sale of assets to divide the proceeds among the beneficiaries. When this happens, the tax laws come into play, and you can lose a substantial amount of value of your estate in taxes, leaving far less to your beneficiaries than you would like.

How do you prepare a will?

   There are a variety of ways to prepare a will, including some very low cost solutions. At the expensive end, you can hire a lawyer to assist in the preparation. They will help you compile a list of all your assets and debts (liabilities). From there, you can indicate who should receive what asset, or part of an asset. That same process is followed by the cheaper options, websites or even DIY kits that you can find on Amazon!

   Once prepared, the will should be witnessed by 2 adults who aren’t included as beneficiaries. The final element of creating a will is to name an executor, someone who will work under court supervision to ensure that your will is followed. Other than being an adult, there are few restrictions on naming an executor, and you can easily name a spouse or child to deal with this. The executor’s role is important in ensuring the smooth settlement of your estate, including discharging any remaining debts you have, and informing government and financial institutions. 

   Now that you have a will, store it in a safe place! A home safe is usually best for this.

   You work hard for your success. Make sure that those efforts aren’t wasted for your loved ones, family, friends, and community that you leave behind. Taking the time to create a will is an important step in ensuring that your assets are distributed fairly, without losing excessive amounts to taxes. And if you have young children, this step is even more important as it will ensure they are cared for by the people you nominate.

   A will is an important element of your financial plans, that will ensure your achievements keep paying off to your loved ones long after you’ve moved onto your afterlife adventures.