Step 1. Cut extra spending. Considering a family of three or four, here are some examples of things you might cut:
1 Cable—$640 yearly (opt for watching movies on DVDs that you check out for free at the library and read your news online—and watch the savings accumulate)
2 Starbucks—$440 yearly (skipping a latte twice a week adds up)
3 Eating out—$1,920 yearly (eat at home four more days a month and your family could save a bundle each year)
4 Membership/Association—fees $200 yearly (taking a break from memberships that aren’t essential means more money in the bank)
You are just on step one and have already saved $3,200—that’s only $300 away from the amount you wanted to pay off on your debt. To pay off your desired $3,500 and also increase your savings by $800, you still have $1,100 to go.
Step 2. Increase your monthly income (see Chapter 11 for ways to do this). To make up the remaining $1,100, you only need to make about $150 gross per month, but if you make more than that, say $450 a month (roughly an extra $100 a week), you would have almost all of your $7,000 in debt paid off as well, even with taxes and a tithe or donation to charity figured into the equation.
Step 3. As you begin to save and make money each month from these expense cuts and additional income, start paying it toward your credit card and putting some aside in savings as well so that you reach your goals in both categories by the end of the year.
Step 4. Once your debt is all paid off, continue to put aside money each month in savings so that next time an unexpected expense comes your way, you can pay in cash rather than going in debt again.
As you can see, this process is extensive, but it’s imperative if you plan to make changes in your life and raise your satisfaction score. Repeat this process for each category, making goals and then action steps. By the time you finish, you will have built a systematic process for reaching all of your goals.
Setting Your Mind on Goals
I am certain that you have heard time and time again how important it is to have goals and write them down, and perhaps you are even familiar with the research around goal setting. For instance, in 1979 the Harvard School of Business interviewed new graduates from the Harvard’s MBA program and found that:
84 percent had no specific goals at all.
13 percent had goals, but they weren’t committed to paper.
3 percent had clear, written goals as well as plans to accomplish them.
In 1989, the interviewers again interviewed the graduates of that class. You can guess the results:
The 13 percent of the class who had goals were earning, on average, twice as much as the 84 percent who had no goals at all.
Even more staggering—the 3 percent who had clear, written goals were earning, on average, ten times as much as the other 97 percent put together.
Sociologists that have studied success and failure find that 95 percent of people never have any written goals, but of the 5 percent that do have written goals, 95 percent have reached their goals.
Despite the fact that most people would agree with the statement that setting goals is important, they don’t often feel the need to take it a step further and write them down, which I believe to be vital. There are several reasons that people give for not setting or writing down goals:
1 Believe that because they know them, they don’t need to write them down
2 Don’t have time
3 Don’t see the importance of doing it
4 Can’t keep track of where they write them
5 Have no desire to do it
6 Fear of failure
7 Don’t know how to write goals
To help you further understand the power of the written word and thus why it’s so important to write your goals, let’s take another look at how your brain works. According to studies, educational researchers suggest that approximately 83 percent of human learning occurs visually, and the remaining 17 percent comes from the other senses—11 percent through hearing; 3.5 percent through smell; 1 percent through taste; and 1.5 percent through touch. Because your brain processes information visually, it’s extremely important that anything you deem important and want to remember be written down in order to stimulate your brain and to store in your memory. Simply put, you can forget what you don’t see. So goal writing equals success, which means, you’ll want to get started on writing your goals down right away!
Let’s look at how to write specific goals. These goals are what I refer to as TARGET goals. TARGET is an acronym for tangible, achievable, reward, growth related, exciting, and timeline. Here’s an example of a TARGET goal:
Tangible—Cleaning out the garage.
Achievable—Yes, but I may need some help from a friend.
Reward—Will treat myself to dinner for accomplishing this task.
Growth related—Doing this will help me get organized.
Exciting—I’ll be able to park my car inside.
Timeline—I will do it over the weekend.
So the actual goal would be written out as follows:
Goal—I will call Tracy to help me clean out the garage this weekend to help me get organized and be able to park my car. Dinner is on me for our hard work.
You’ve admitted that you’re lost and you’ve decided to get unlost. You’ve made a decision to change and you signed a contract with yourself. You’ve looked at who you are and how you’re doing in six critical life categories. Now it’s time to look at those fundamental questions, which were listed at the beginning of this chapter, and write down the answers to those questions in your notebook: Where you would like to go? What route will you take? How long will it take you to get there? Whom are you taking with you? What are you expecting out of the journey?
Now that you know more about the process of setting goals, you can fill in specifics for some of those questions using the TARGET approach detailed above.
Use these steps to help you prepare for your journey:
1 Chart your route. Planning and writing your goals is the only way you are going to get to your destination.
2 Pack necessary supplies. Gather the important things that you will need to accomplish your goals. For example, you may need to purchase large trash bags and steel shelves in order to clean and organize your garage. Or, if you want