Dreams vs goals
Before I start talking about serious financial topics, I'd like to take a moment and discuss about why it's a subject so dear to my heart. When I started working, I'd save part of my paychecks and put it aside. No reason really, I just kept my expenses low. I left that money in my bank account since I didn't need it for anything. The amount of money wasn't life changing, but it was enough to not have to worry if I lost my job so that was good. I knew having money set aside would be a good thing. But I had nothing in mind to do with it so I left it there, rotting away with a measly yearly interest of <1% (thanks a lot, bank). During that time, I lost out on free money: had I invested that money, I could have enjoyed >10% yearly gains thanks to the stock market.
Today, I invest my savings in a balanced and diversified portfolio. I also target a specific percentage of my paycheck to set aside each month instead of just "whatever's left". I promise to bore you with the details later, but for now let's keep it simple. I'm on target to be able to retire at some point in my life and not have to worry about money. So what changed?
In one word: me. I've always had dreams, like starting my own business or traveling the world. But I had no focus, no plan on how to achieve them. It was fun dreaming about what my life could be once I got there, and that if I worked hard one day it would all work out for the best. But while I was busy living my life and daydreaming, nothing advanced. I was not closer to starting my own business, I was not closer to realizing my dreams. My life was still good, I had friends and family, a job and a place to live, but for me to become the better me I needed to focus and to plan.
The first goal I set up for myself was to learn, since I had no idea what to do with the money I had saved and would continue to put aside. What's so great about these times is that so much information is available at your fingerprint, you just need to fire up a browser and get on it! So I started reading financial blogs written by a variety of authors, doing my own research and learning a lot. When I felt like I knew enough to start, I set a new goal and started planning the next step.
The takeaway from my story is that I only started doing real progress toward realizing my dream when I stopped thinking of it as a dream and set myself some clear goals. With focus and planning, I got closer to achieving them. The easier you make it for yourself to do the right thing, the more success you'll have in realizing your own dream.