Why Goals Are Not For Everyone
Hint: Behavior Plays Its Part
November 13, 2019
Goal: the object of a person’s ambition or effort; an aim or desired result.
In the world of finance there has been a strong and ongoing push towards aligning personal finances with an individual’s lifestyle goals.
This goals-based approach to financial planning starts by asking “What do you want?” and “Where are you today?” in order to help engineer a path to achieving a desired outcome.
For some, those outcomes could be saving up to buy a boat or a cottage, while for others, it might be having enough money in the bank to pay the electricity bill next month.
While this process is certainly useful, behavioral science has shown that generally, people put an unrealistically high value on the here and now and an unrealistically low value on the future.
This makes it quite difficult to choose to do something that’s good for us in the future (like saving for retirement) at the expense of doing what feels good right now (like going out with friends this weekend).
With these behavioral blind spots impeding our approach to setting and achieving goals, how might one ensure that their actions map to their ambitions?
The answer is: “It Depends.
To better understand how best to approach (financial) goal setting on a personal basis, we believe one should uncover and understand how their natural behavior impacts the degree to which they may, or may not be, driven by goals.
What does that mean?
For you, setting financial goals will come naturally but you may do so at the expense of other priorities.
But what if you’re more inclined to live a life of contentment?
Keeping balance in your life will be important and you tend not to sacrifice your desire for a contented life in support for or in pursuit of long-term or lofty goals.
You do well in supporting others who are more driven to set and achieve goals, and can yield some personal ambitions for the sake of other people’s agendas.
While you may not want to be the one setting the goals, this type of supportive attitude can be an important asset to the success of relationships.
While it may be easier for pioneers to set and pursue goals, their caveman brains may still get in the way. And for those who prefer the status quo, it is still important to break things down in a way that will allow them to achieve their desired outcomes.
Studies have shown that by simply taking the time to anticipate in advance the barriers that may stand in the way of meeting future aspirations and setting up a plan to respond to each obstacle, we can overcome those innate blind spots.
That’s why our process for building solid financial foundations is rooted in helping people identify what they want, why it’s important to them, where the barriers may be, while also amplifying the benefits that will help in reaching their desired outcome.
This straightforward method is just one way to use what we know about human behavior to help support and strengthen financial health in the workplace.