Nowadays, a common phrase you will often hear in both life and business is “find your why”. So, how can you find your why and what does this exactly mean? Let’s look at why finding your ‘why’ is the key to setting successful financial planning goals.
“Your WHY is your purpose, cause, or belief. WHY does your company exist? WHY do you get out of bed every morning? And WHY should anyone care about the work you do?”
The Golden Circle – Simon Sinek
Emotions drive decision making
Goal setting is an essential part of our everyday lives, it’s how we get to where we want to be. But it’s usually our emotions that drive our decision making; from meeting our life partner to buying a new home. Emotions also drive decisions relating to applying for a particular job, pursuing a specific career, or setting up a certain type of business.
In recent years, research has increased on the way our brains make decisions based on our emotions. In one leading study by Harvard University, it was proposed that our emotions impact our judgment in several different ways. We have integral emotions that respond to a present scenario and incidental emotions that are triggered from other situations. The study also looked at the way our brains are hardwired in terms of specific emotional responses.
So, how do emotions affect goal setting? When you set a goal, you need to understand your true motivation behind that goal. Why have you set the goal? The ‘why’ is important because people can often find themselves making decisions based on different emotional responses. We can get pulled into a way of life that might be the status quo or an accepted stage of life. But deep down, people might secretly want to pursue another course of action.
When people are fully invested into a certain path or pursuit, they tend to be more successful because they take a proactive approach to planning. When you apply this to financial planning, you can begin to see the importance of finding your ‘why’ for goal setting purposes.
Ways to find your why
Our team believes that everyone needs to understand their ‘why’ before we begin the financial planning process. We spend time talking to our clients about their aims and aspirations. Our financial planning team have trained with the Kinder Institute of Life Planning, which focuses on what’s important to you apart from your money.
Below are a few typical questions from Kinder and other resources we have collated to help you find your why:
- If you had more time or money, what would you do?
- What moves, touches, or inspires you?
- What do you want to accomplish or attain so you will feel that you’ve had a life well-lived?
- Do you have a specific strength or talent you wish to develop?
- Is there an activity or skill you have always wanted to learn?
- Have you ever wanted to live in or visit a certain location?
- …and the list goes on!
One technique is the 5 Whys Test. Ask yourself the same question five times, answer honestly, and don’t repeat the same answer. When you understand the true motivation behind your objectives, you can start setting practical goals. Try to visualise what your life would look like once you have achieved these goals. Will this picture of your future life be as fulfilling as you hope it will?
Once you have clear aims and aspirations, you can focus on a realistic plan to achieve your goals.
Holistic financial planning, Nottingham and Derby
Setting goals is important; it’s how we get to where we want to be both now and in the future. As it’s often our emotions that drive our decision making, we need to be sure that we have chosen the right ones. Everyone has different goals specific to them. You might have short-term goals for your present lifestyle, and long-term goals for your retirement.
When our financial planners talk to our clients, we ask them about their personal goals, values and priorities. Our team will then look at whether you have enough money to live your current lifestyle and achieve these goals. We will advise you on a suitable strategy using cash-flow planning, financial planning and retirement planning methods.
Balance: Wealth Planning has recently won Money Marketing’s Best Retirement Advice Firm, which recognises firms that can demonstrate excellence in retirement advice. We are also thrilled to have won Next Generation Advice Firm. This accolade recognises financial firms that demonstrate an innovative approach to financial planning through technology, modern business practices, and a client-centric approach.
If you need help with your financial planning goals, get in touch to speak to our financial planners.
Sources:
https://simonsinek.com/golden-circle/
https://scholar.harvard.edu/files/jenniferlerner/files/emotion_and_decision_making.pdf
