Today, I've got another little visualization exercise to help you figure out what is important to you. Try to do this with a little quiet, but if you can't, OK.
Imagine that you in total control of your finances. You wake up in the morning. What does your life look like? What does your room look like? What do you do when you get up? How does your day unfold? Note the details and what is different from your current life. Do you live in the same home? Have you decorated or changed it? Do you have the same job? Same hobbies? Do you spend your time doing the same things you do now?
You might want to take notes because it is easy to forget. Focus on the things that you imagine differently in your financially free future, but also remember that some things money can't change. For example, I could have all the money in the world and it wouldn't make my children any tidier, or make them get up more cheerfully.
Use this brainstorming to help identify things that are important to you, and we'll use it as we move through this process.
When I’m on a long driving trip, I always look for lottery billboards and spice up my drive imagining what I would do if I won 276 million dollars in the Powerball. I imagine a house on the water, someone to clean my house, and taking my extended family on relaxing vacations. What I don’t imagine is quitting work, a huge house, or fancy cars.
What does this have to do with real personal finance, you ask? A lot.
If you imagine what you would do with a huge lottery windfall, and you are thoughtful about it, it will tell you a lot about your personal priorities and desires. You can use that information no matter how much money you have, to make sure that you are making good decision with your money and using your money on things that have value for you.
What do I mean? Well, let’s look at my dreams. I dream of a house on the water, a cleaning person, and vacations with my family. I might not be able to accomplish all those things on my current income, but I can look at my spending to see if I’m making the best financial choices to support those priorities. Can I keep on driving my car for several more years to spend that money on a week at the beach with my family? Long term, do I want to move somewhere less expensive so that I can live on the water? And do I really want to pay someone to clean my house, or do I need to get rid of some stuff so that I don’t have so much to keep clean?
Dreaming of a big win helps me prioritize my wants. Knowing my true wants is the first step to making those dreams come true. I may not have won the lottery, but I’ve learned a lot about myself in the process. It’s an interesting exercise and you might want to try it.
This is a reprint of an old post on goal setting, republished as part of our Back to Basics Week Two focus on Dreaming about your financial goals. Some other ways to brainstorm your financial goals. Some other ways to help figure out your priorities include thinking about whether your spending reflects your values and thinking ahead towards how you would like your future to look.