Do you remember the “May Path to Financial Freedom Journal by Avida Land” I received two months ago? The contents are worth reading. I found out that I am already doing some tips written in the financial journal. I’m glad I did those tips and learned other ways to better manage our family finances. Sharing to you a brief on Smarter Ways to Financial Freedom.
My passion of managing my finances started when I was in college. I am a working student before to help with my allowances during that time. After graduation, I saved part of my compensation to open a small business. It is the beginning of how I manage my personal finances with the business.
Smarter Ways to Financial Freedom
The Plan is an essential part of any goals that you wanted to achieve. This Smarter Ways to Financial Freedom or the financial freedom road map is by Kendrick Chua. Planning finances are too daunting but when you have a plan, you’ll have an overview and guide on what to do next.
To help you in accomplishing your plan, Management experts have been emphasizing on planning S.M.A.R.T. Goals. Of course before you do the SMART goals, you should have done the 3 simple steps to make an effective Statement of Cash Flows. I didn’t include it here because I believe that most already knew that. For the benefit of those who are not aware of it, here are the 3 simple steps:
3 simple steps to make an effective Statement of Cash Flows
- List all income.
- List all expenses.
- Compute for the net cash flow.
S – specific
A – Attainable
R – relevant
My husband who is part in the management level in his job role uses this guide. Let’s tackle a brief explanation with these SMART Goals.
- Be SPECIFIC. You should have a list of your specific dreams. The photo above is my current specific dream. My family is now in the phase of completely finishing our houses. Followed by dreaming or having a van or acquiring a business or start investing in stocks. We have a current investment, but not yet in stocks. For the business flow, I use the power of leverage that is why I need a staff. Although we can travel locally, before tripping out of the country, we need to save big money for the whole family. That is why it is last in the list.
- The Plan should be MEASURABLE. When you have established something, you feel it is worth pursuing. Most of our dreams need financing one way or another, so while coming up with the specifics, do put an amount beside it. Seeing the amount, helps you measure and evaluate how you are progressing towards your goal.
- Be Relevant. The specific dreams with amount should answer the questions WHY. There should be a reason relevant to improve your lifestyle and those around you. Like in my case, all my dreams are connected to my family so there’s no turning back. It’s become more challenging and motivated to turn these into realities.
- Attainable. Reality Check: Expectations collide with reality. You need to manage expectations. It’s ok to set lofty goals, but make sure it is attainable. If you set specific dreams beyond your current capacity then you’ll have to make an adjustment to reach it. It is better safe to start with what your current financial capacity can cover. Like in our case, my family’s first house investment has a lower cost. Because we wanted a better housing, we work harder to reach for that goal. Although home improvement to our better home is still on-going, now we are living that specific dream.
- Time-bound. There should be a deadline set for the specific, relevant, and attainable goal. It creates a sense of accountability. With deadline, there is a pressure to hit it.
To make your SMART goals more encouraging and enjoyable, do it S.M.A.R.T.E.R.
R – rewarding
- It’s truly EXCITING while approaching your SMART goals. These goals provide us with direction and purpose. What we can do with our excitement is to work hard for it. Be inspired, motivated, and consistent.
- Accomplished goals are REWARDING. Before our better home is just a plan. When we totally moved in, hubby and I told ourselves “We made it!” It is true that once you achieved a goal, it elevate your standards. There is always a challenge, but at the end of the day after reaching your goal, the rewarding benefits give you a sense of comfort and happiness.
There you have it. Sorry for my lengthy post. Do not waste time, do the Smarter Ways to Financial Freedom. Thank you Avida Land for this helpful Financial Journal.