Mike Reilly, B. Sc.

Financial Security Advisor
Investment Representative
Freedom 55 Financial

2016: How Did You Get Here?

As we near the end of the year it’s common for people to be disappointed with their accomplishments over the past twelve months. January is the traditional month for setting goals for the new year while the frenzy of December activities often leaves little time for reflection. I’m sure that one of the reasons so many resolutions for health, finances, career and family fall short, or are abandoned entirely, is because they’re made without a clear understanding of core values.

There’s a Confucian quote that says: “Study the past if you would define the future.” More simply: You can only get where you want to go if you know where you’ve been. Without an honest assessment of what’s important to you, based on your past actions, achieving new goals is like trying to get to a destination without any roads.

One of the critical activities I go through with my clients is goal setting. I find using the S.M.A.R.T. method (which requires goals to be specific, measurable, achievable, realistic and time-bound) is extremely helpful but only after the initial step of value assessment.

Setting a goal to “pay off all my debt this year” or “save $20,000” is self-defeating if the person holds unspoken principles or desires that are contradictory to the goal. This is because achieving new objectives requires the adaptation of new behaviours, which in turn requires leaving behind of old patterns of thought and action.

A person who has never been a long distance runner cannot set a goal of running a marathon in 11 months unless they’re prepared to add hours of training to their schedule in place of other activities. Similarly, a person who wants to achieve different financial outcomes must take on different spending, saving and investing patterns than before. These past financial behaviours are all linked to some personal value system that is far more complex than dollars and cents.

My job is to help uncover what is important to the client and help them realize how or why a change may be required. Over time, we will have discussions about a variety of topics that all fall into seven life “value categories.” While this is completely unscientific, the effort helps us both understand where you place more importance.

The seven categories I consider include:

Relationships and family – your frequency and intensity of connections

Physical – your level of activity and awareness of health

Business – your commitment to and fulfillment from work

Financial – your overall attitude towards money as a tool

Spiritual – your awareness of self in relation to the Universe or a higher power

Mental – your dedication to personal and professional development

Lifestyle – your balance of work, play and family

I have found that if there is an imbalance in one or more areas, it may be a predictor of the likelihood of achieving a financial goal. For example, if the goal is to save for a family vacation, but the current commitment to family activities is low, this may be a goal quickly surrendered to a competing spending priority. However, through discussion, you may become aware (often for the first time) of this imbalance and see the new goal as an opportunity to re-dedicate yourself to that area of their life.

This methodology is effective in goal setting for considerations other than financial, and there are many good resources at the library and on the Internet. I would encourage you to take some time this month to look back on 2016 and understand where you’ve been. If you do, you can trust that your New Year’s resolutions will be tied to those values that are more important to you and stand a better chance of being achieved by December 2017.