Wishing we had more will power to save for retirement, to lose extra pounds, or to write that book we’ve been planning to do for years usually doesn’t help us achieve the goals that are important to us. Some motivational bloggers do tell us is that we need to have SMART goals – specific, measurable, achievable, realistic, and timely. Using a SMART plan as a basic guideline makes sense for many personal goals, but I also find that breaking down larger goals into their component parts also makes sense.
Small Steps Towards a Larger Goal
For example, most people hope that they will have enough passive income in retirement so that they can live in relative comfort. Yet few are actually prepared for their real expenses after they leave the workplace.
My husband retired years earlier than I did. When I was in my fifties and started getting really serious about making sure I was eventually prepared for retirement, I realized that part of preparing for retirement included identifying what kind of lifestyle we eventually wanted. It takes work to figure out what you want life to look like in the future—where you want to live, what types of activities you enjoy, and any travel you plan to do, etc.
Another piece of my own retirement planning included getting a good grip on what it was going to cost each month to maintain the lifestyle my husband and I wanted. How much would it cost to pay for Medicare and supplemental insurances (including vision and dental insurance) after I retired and we no longer had health insurance through my work? Even though the house no longer had a mortgage on it, how much should we expect to pay on average for home maintenance (roof replacement, painting, replacing the furnace, or anything else that might need to be maintained in the future? At what point would we need to replace one of our cars? What might it cost for in-home, long term care, if we eventually needed it? How much would we need to spend to make our home age-friendly?
For us, it also made sense to figure out exactly how much we were spending each month before I retired. Every week, for one year, I recorded just about every cent we spent on a spreadsheet. I knew what our habits were, what we would no longer be spending in the future, and what we would be adding. Keeping track of our expenses also helped me be more mindful about spending that made no sense—I really didn’t need to have a membership with two different wine clubs and a monthly obligation to buy a certain amount of expensive wine.
After analyzing what we were spending and what we were likely to need in the future, I was able to look at anticipated streams of passive income (pensions, Social Security, etc., IRA accounts, etc.) and compare those amounts to our expected levels of spending. In addition, we worked with our financial advisors to make sure our plans were on track. By breaking down our retirement planning into smaller, manageable tasks, we both felt like we were prepared when I retired a little over two years ago.
One other goal that I’ve had since I retired was to get a book written. I have done enough research to write several books. But after starting my book a few months ago, all I had completed was a single chapter. I was sharing my lack of progress with another writer a few weeks ago who gave me some good advice. He told me to simply break the process down—plan to write one page a day. I am now finishing chapter five and am pleased with what I am accomplishing. I will have my book drafted within the next two months. My goal is SMART—specific, measurable, achievable, realistic, and timely. My goal has also been broken down into small steps – perhaps that makes it more achievable as well.
Wishful thinking is not a plan, but having a good plan can help turn your wishes into reality.