It’s actually a fallacy that ostrich’s bury their head in the ground but have you ever had a problem in your life that you try to avoid at all costs so you just choose to ignore it? We all do it and we all know that it usually makes the problem worse and we still make that choice rather than face our problems head on. The problem that I am specifically talking about today is goal-planning. Everyone’s goals are different but the requirement of having specific, measurable, and attainable goals should be the same for everyone.

Here are some examples that I hear regularly, “I want to be able to help my children with their education,” or “I want to be comfortable in retirement.” These are not goals, they are statements.

Let’s start with the statement, “I want to be able to help my children with their education.” This statement just opens the door to many other questions. Do you want to utilize an Registered Education Savings Plan or a form of low-interest debt? Both? Do you know how to take full advantage of the government bonds and grants? Do you expect your child to pay a portion of their expenses? Do you expect them to get their education in the same city as you live or what if they decide to move somewhere else in Canada (or do a year abroad)? What programs do you think they will be interested in? These are just some questions to get you thinking. There is a vast discrepancy in the cost of different forms of education that are available and you don’t need a degree in math to budget for their education but it definitely helps if you ask someone knowledgeable in that area for help. Remember in the beginning of the article when I talked about goals being specific, measurable, and attainable? Here is an example of a goal regarding education, “I want to ensure that I can provide my child (who is 5 years old today) with at least $10,000 per year for 4 years to help with their education after they graduate primary school.” This goal is specific because it says how much, when it is to be paid and for a specific duration of time. This goal is measurable as the progress can be tracked over time. This goal is attainable due to the fact that it doesn’t require an unrealistic outflow to achieve this goal. In this example, the child is 5 years old and the goal is achievable by their 17^th birthday by investing around $200 per month into a moderate investment from the age of 5 in a RESP until the end of the year in which the child turns 13.

Now on to setting a goal for retirement, but we will start with one of the statements that I usually hear, “I want to be comfortable in retirement.” This does not give any insight into what you are trying to accomplish. Are you talking about creating a multi-decade inflation-adjusted income that will last for the rest of your life or are you talking about the La-Z-Boy chair that you plan on purchasing for your living room? How about something along the lines of this, “I would like to be able to achieve an after-tax, inflation-adjusted income of $5,000 per month (in today’s dollars) starting from age 65 and last me until age 100. I am open to downsizing to a condo upon retirement so that I can travel stress-free and help fund my retirement expenses. I want to ensure that I have enough money saved so that I have the choice of hiring in-home care after the age of 80 and I want to leave a $500,000 legacy for my children.” This statement is very specific, can be measured as time goes on, and is attainable. You may currently be in retirement, be close to it, or it may be a distant hope but everyone should, at the very least, be thinking about it. There is no “too-late” when it comes to retirement but the more time that you have before that day then the more options that you have to achieve your goals.

The chance of your life happening exactly as planned is next to zero and these are just some pointers as to how to create a real goal. The true value in setting goals and the creation of a plan to achieve those goals is through revisiting and revising both as time goes on. Our lives are dynamic and ever-changing and so-should your goals and plan to achieve those goals.

Our lives equate to the sum of every decision that we make along the way and you have all the power to guide your own personal results. Don’t be an ostrich and let time and the rest of the world pass you by while you have your head in the sand.  

If you need help creating a vision for your own personal multi-decade journey then feel free to reach out to info@financerx.ca.