I’m only 37, but lately I’ve come to the realization that I may be having a mid-life crisis. To even write it down feels stupid and cliche’, but I think it best explains what I’ve been feeling. I don’t want to bore you with the details. How this pertains to you & your site is that over the years I’ve had various goals, such as graduate college, earn my CPA license, get a great job etc. Most of them were achievable within just a few short years. My next goal is to become debt free and I’ve come to the realization that it will take some time for that to happen. Beyond that, the only real goal I have for myself is retirement and that is pretty far down the road. Ultimately those distant goals have been the source of my depression. The feelings of ‘is this all there is’ starts to sink in and then I started disliking going to a job that I love. I spend my thoughts thinking about how things are pulling me in directions I don’t want to go. I’ve recently decided that I need to focus on my goals and create some shorter term goals to help get through my depression and frustration.

I think Matthew hits upon the real problem with long-term goal setting – there’s no immediacy.

Humans are hardwired to focus on the short term. The vast majority of our thoughts are in the present or extreme short term future. We’re thinking about what we’re reading right now. We’re thinking about our to-do list for today. We’re thinking about the birthday party we’ve got planned for next week.

Rarely do our thoughts focus on events more than a few months in the future. These events, for the most part, don’t feel quite real to us. They feel trapped in the mists of time, so we don’t see them clearly – and thus rarely think about them in a concrete fashion.

This gets us back to Michael’s problem. If all of the things we’re looking forward to in life are shrouded in the far-off future, we’re left with little to look forward to in the short term. This, unsurprisingly, leads to unhappiness. We feel aimless. We wonder if this is all there is in life. And sometimes we can become depressed.

The solution, I’ve found, is to keep busy in the short term, both with short term things and with smaller projects that fit in as part of the bigger goals I have in life. Here are some suggestions to chew on.

Keep a full social calendar. Organize your time so that you’re busy with something most evenings instead of sitting at home. A wise old friend of mine used to say that “the devil makes work for idle hands.” I think she meant that the more free time you have, the more time you have to dwell on things and convince yourself of negative thoughts. This has certainly been true in my experience.

In Michael’s case, why not get involved in community organizations that interest you? Many such groups would love to have a CPA as a treasurer for the group and it would allow you to keep busy, meet interesting people, and so on. If this doesn’t fit, seek out groups that revolve around your personal interests. Or, if nothing else, pencil in a weekly dinner party and invite friends to it.

Develop – and accomplish – month-long projects. What would you like to accomplish in the next thirty days? Pick something audacious but not back breaking, yet something that will genuinely improve some aspect of your life. Recently, a friend of mine read the entire Bible in one month and is now following it with the Qu’ran in one month so that she could better comprehend some of the social conflicts between Christianity and Islam. Another friend worked towards being able to do 100 pushups in one straight stretch at the end of the month.

Michael, sit down and make a list of five or so things that, if you accomplished them in the next month, you’d really be proud of and happy with yourself. Choose one or perhaps two of them and focus on them intently. Keep that goal central in your mind throughout the month and put continual effort towards it. At the end of the month, you’ll find you’ve improved your life in some regard. Then do it again. In a larger context, such “thirty day projects” really serve to improve a person over time, albeit in a piecewise fashion. (I’ve got a great post on this coming up soon.)

Seek out smaller projects (one to three months) that fit in the context of your larger goals. For people in Michael’s shoes, they have long term goals in place but the stepping stones to reach them are sometimes unclear. They might know what kinds of things they need to do to get there (spend less! network more!), but making that into something tangible is tricky.

This is a perfect time to stop and ask yourself what sort of building blocks you could have in place that would make reaching that big goal easier. For example, if you’re trying to get a promotion at work, a new certification might be useful – or a serious upgrade in your presentation skills. If you’re trying to save for a big, long term goal, a major project that results in something that will save you significant money can be really worthwhile.

Michael has a long term goal of debt freedom and he likely has a “number” he wants to hit each month in terms of extra debt payments, but that’s not really a project per se.

Instead, he should try something else big and audacious. Michael, why not start a three month project to make your home as energy efficient as possible? Air seal your entire home. Install a programmable thermostat. Check the insulation and install more if it’s recommended. Put all of your home electronics on smart energy strips. Switch all of your light bulbs to CFLs and LEDs. Perhaps even replace your windows, doing them yourself, of course. This is a huge project that involves a lot of work – it’ll eat up a lot of your spare time – but at the end of it, your energy bill will drop by half or more and you’ll likely increase the resale value of your home.

Another project: learn exactly how your car works. Teach yourself how to do every single maintenance task that needs to be done for your car yourself. Not only is it less expensive, but once you know how to do these things, you can do them for pretty much any car you come across. It’s another skill in your belt that’s a direct money saver for you and might be a skill that you can utilize to help friends.

These are just a few examples. There are many more floating around out there.

Find a personal passion or hobby to channel yourself into. What do you enjoy doing in your spare time? Most people can name some things. The lucky among us names one or two big things with a huge smile on their face – those are the people that have found their passions.

Seek out your passion by trying lots of new things. Go to single meetings of lots of different community groups. Try out activities you’ve always wanted to try but never seemed to find the time. Learn how to play a musical instrument. Teach yourself a foreign language and travel to that country. Take up golf – or competitive Scrabble. Learn woodworking. Whatever it is that itches inside of you, give it a shot and see where it takes you. If it fizzles, try something else. But always seek your passions – and when you find them, you’ll know. They’ll flip you upside down and change your life.

Good luck.

I didn’t really have an answer.

Sure, I have lots of long term goals of all kinds. My wife and I want a house in the country, of course, as I’ve mentioned many times. I’d like to get a novel published, one that I’ve been working on for a long time. Financial independence is a big goal, of course. I know, in broad strokes, what my life will look like in five years, barring anything I can’t predict.

But when I look back to the goals I’ve been successful with in life, they’ve been very, very specific in nature. If I set a goal of not spending any frivolous money for a month, I can achieve that goal because it’s clear to me what I need to do to get there.

On the other hand, with the less tangible big dreams in my future, I find myself a little more aimless. I have a hard time tying those big dreams to actions I can take today, so I’ll sometimes forget about them.

The challenge for me is this: I know where I want to be in five years, but the road to get there is sometimes covered in fog. I don’t have a good grasp on the things I need to be doing along the way – other than generic things like spending less than I make – in order to reach those goals.

On the way home, her uncle’s comment stirred me into action. I want to set a few very specific and clear goals for the future, along with very concrete paths on how to get there. Doing this lets me know what I need to be doing all the time to reach the things I want.

So, without further ado, here’s where I want to be in five years. I’ve set up three very specific goals, along with the path to reach each one.

Goal #1: Total Debt Freedom
That means paying off our entire mortgage, which has a balance around $165,000, as well as all other remaining debts. In five years. Including remaining student loans and auto loans, that adds up to about $190,000.

What can I specifically do this month to achieve this goal? Each month between now and October 31, 2014 (when my five years are up), I would need to knock an average of $3,200 off of my total debt balance. That’s an incredibly high number, one that pushes me to really bear down on our situation. In the first few months, I simply won’t be able to reasonably apply that much towards the total balance.

What else can I be doing to support this goal? The biggest thing I can do to support that goal is to make the $3,200 a month goal as reasonable as I possibly can. This means coming up with additional ways to earn income. Thus, each month, I need to develop a new potential avenue for income related to The Simple Dollar and my other endeavors. Preferably, these take the form of passive income – I can invest a substantial packet of time once and then enjoy the fruits of that labor over time. This would mean designing more “downloadables,” perhaps creating a few self-published books that are collections of posts organized in a logical fashion, and other such avenues.

Goal #2: Learn a New Language
By “learn a new language,” I intend to learn enough so that I can engage in an intelligent conversation with a native speaker of said language on pretty much any topic, and I’d be successful if I were to visit the countryside of a nation where everyone only spoke that language and no English to help me out. This is something I intend to do with my family in the future.

I’m not entirely sure which language, but I’ve narrowed it down to four options: German, French, Italian, and Norwegian. French and Norwegian are slightly in the lead.

What can I specifically do this month to achieve this goal? The goals for making this work are much more specific. Each weekday, I could spend an hour in language training using a tool like Rosetta Stone until I’m familiar with many of the words of the language and can hammer through basic conversation. Once I’m there, I would just continue to immerse myself in the language, listening to radio in that language as I worked and so on.

I’ve had a lot of success with short-term immersion in other languages in the past, but I never subjected myself to continued practice of the language.

What else can I be doing to support this goal? I live near a university, so one option would be to enroll as a part time student and take classes in my language of choice. This would enable me to gain some additional practice in actually speaking the language.

To put it simply, the best way for me to learn is to seek out every opportunity I can to immerse myself. The best way to start, though, is in my home.

Goal #3: Get a Novel Published
Right now, I spend maybe a few hours a week working on fiction, usually turning out a short story in that timeframe or editing/polishing an older one. I completed a novel several years ago, but when I look at it now, I deeply dislike it.

I actually enjoy writing fiction quite a lot, perhaps more than the essay-style writing I do on The Simple Dollar. I can purely focus on story and character rather than passing along information directly.

So why not take advantage of my situation and see if I can get my feet wet in the fiction world?

What can I specifically do this month to achieve this goal? Each month, I need to finish five short stories. By finish, I mean write a first draft, let it sit for a month or so, re-read it and polish it, and perhaps repeat the “let it sit and polish it” routine a few times. From there, I’ll pass the stories to my wife and let her choose the best one, then I’ll attempt to publish that one (and perhaps put the others out there on my personal site).

Once I feel much more adept at fiction (wait… does anyone really feel adept at writing? I still feel like an amateur and I’ve written millions of words over the past several years.), I’ll begin to tackle a novel that’s been forming in my head for a very long time. I’ll start that at roughly the two year mark.

What else can I be doing to support this goal? I should talk directly with the people I know in the publishing industry (thanks to my personal finance books) and see where they point me. I also need to put substantial effort into getting my good stories published so that I’m noticed in the fiction world.

Your Turn?
Now it’s your turn. Where do you want to be in five years? Can you pick out three specific goals that you want to achieve? From there, can you break those goals down into specific pieces that you can start working on now?

Setting goals have helped me get to my current station in life. There’s no reason why they won’t help me keep climbing the mountains to my dreams.

In the early years of this decade, General Motors had a goal, and it was 29. Determined to boost its flagging profits and reverse a long, steady fall from postwar dominance, the automotive giant did the natural thing: it set a goal. The company pledged to recapture 29 percent of the American market, the share it had ebbed past in 1999. The number 29 became a corporate mantra, and some GM executives took to wearing lapel pins with the number emblazoned on them.

It didn’t work. GM never did regain 29 percent of the market, and today, facing the possibility of bankruptcy, it looks even less likely to do so. The lapel pins are gone, and that number isn’t much heard from the company.

And while the causes of GM’s woes are many – from poor design to high labor costs to a prostrate economy – industry analysts argue that one of the most damaging things the company did was to set that goal.

In clawing toward its number, GM offered deep discounts and no-interest car loans. The energy and time that might have been applied to the longer-term problem of designing better cars went instead toward selling more of its generally unloved vehicles. As a result, GM was less prepared for the future, and made less money on the cars it did sell. In other words, the world’s largest car company – a title it lost to Toyota last year – fell victim to a goal.

In other words, GM set an audacious goal but they sacrificed too much to get there, which not only made it impossible to reach that goal, but undermined what they already had. They set a long term goal, but they used short term tactics to get there. Instead of long-term planning (designing better cars, streamlining their production models, offloading less-profitable business segments), they went short-term by doing things like drastically cutting prices, offering loans that undermined their financing business, and pushing forward with poorly-optimized manufacturing facilities.

It’s easy to apply this idea to personal finance. Let’s say, for example, that your goal is to be debt free. You need to ask yourself a very simple question: is your goal simply to reach a point of debt freedom at all costs, or do you want to be sustainably debt free?

If your goal is to just reach a point of debt freedom at all costs, then you’re likely to engage in things like cashing out your 401(k), emptying your emergency fund (and not building one at all), going hyper-frugal, delaying necessary repairs and maintenance, and so on. This plan is the quickest way to get to debt freedom if everything goes perfectly, but it is far from a guarantee. If something goes wrong, you’ve got very little protection against it and your only recourse is more debt.

On the other hand, if you seek sustainable debt freedom, it will take substantially longer to get there, but once you’re there, you’ll stay there. This plan involves building an emergency fund, saving now for retirement and other big future expenses (like future vehicles and education), keeping up with proper maintenance on your home and health and automobiles, adopting reasonable lifestyle changes that can be sustained and still leave you with a high quality of life, and so on. These moves won’t get those debt bills paid nearly as fast, but when you finally do reach debt freedom, you won’t be facing a devastated personal finance landscape.

I look at it much like climbing a tree. Sure, you can make it to the top much faster if you leap wildly from branch to branch, jumping and reaching out for your next position and quickly swinging upwards. However, doing that puts you at a big risk: you can easily fall right to the bottom of the tree and possibly break an arm or a leg. On the other hand, you can climb the tree a bit more slowly, choosing your holds carefully and positioning your feet strongly. Using that technique increases the likelihood that you’ll make it to the top, albeit not quite as fast.

A big, audacious goal is powerful and useful. It gives you something to strive for and it pushes you to do better than before. For example, my big, audacious goal is the country house I’ve often mentioned on here – a nice house on a piece of land in the country with a small barn and room for a big garden and a chicken pen. It pushes me to be frugal and to make good personal finance choices.

However, if you follow your big, audacious goal too blindly, you’ll fall from the tree. I might be able to get that big house a bit faster if I stripped my Roth IRA and my 403(b) and my emergency fund, stopped performing maintenance on our car and our home, and cut out all of the little things that make our life enjoyable. But what happens if an emergency occurs along the way? What about when I finally buy that house – and I realize I have no retirement savings and have missed many years of compound interest, I have no emergency fund, and I have two poorly maintained vehicles? I’m facing another mountain, with goals that I can’t entirely recover (those years of retirement savings and college savings are gone forever).

Reach for your big goal – but do it from a strong foundation. Get an emergency fund in place. Start saving appropriately for retirement. Take care of your requirements at work (before reaching for the big promotion or the second career). Maintain the things you own. Take care of yourself.

That foundation will make any big goal reachable. Without it … you might find yourself going the way of GM.

Over the last few years, I’ve taught myself to play acoustic guitar and lately I’ve started writing a lot of songs. I’d like to record them and share them with others and maybe eventually start playing concerts, but every time I think about it, I want to do something else. It just seems so big.

And Andy:

I liked your article on emergency funds. I want to get started on my own, but I really don’t know where to start. It seems like I spend all of my money before I get around to saving it.

And Zelda:

Could you write a step-by-step post about how to get a garden started? I’d love to have a big vegetable garden and I even have the spot picked out, but I don’t know where to start. It seems like a HUGE task.

I started writing responses to each of these emails, but it didn’t take long for me to realize that most of the points I was making in my responses were the same from person to person. In each of these cases, the reader is intrigued with a big goal, but the big goal seems too big and thus out of reach.

There are a few keys to unlocking any big goal you might face in life. Let’s walk through these key steps, using Connie and Andy and Zelda – and myself – as examples.

Define That Goal Clearly!
Most people have big dreams. I know I certainly do. I have dreams about publishing a series of novels, seeing them in bookstores, signing copies regularly, and seeing a short story of mine published in The New Yorker. Zelda wants to have a big garden. Andy wants to build a six month emergency fund. Connie wants to record an album and play a concert.

While it’s fun to daydream about these things, they’ll never happen unless you establish what exactly it is that you want. The key is to get started, and getting started means knowing clearly where you’re going.

I’ll start off with my goal. I want to write fiction. But what exactly does that mean? What I really want to do is tell a long-form story that really touches people. That, in the end, means writing and publishing a well-promoted novel that has a chance of being read by a wide audience. Doing that fulfills many of my wandering daydreams. Since I have little control over the publishing process, my main focus should be on writing a great novel and preparing for publication by getting other, shorter pieces published.

Zelda’s goal is to have a big garden. But what does that mean? Does she want vegetables? Herbs? Flowers? From her description of the situation, she likely wants a vegetable-focused garden. Where will it go? She has a spot picked out for it. What plants will she plant? That’s a decision Zelda needs to make – what grows well in her area, for starters, and what vegetables does she most enjoy?

Andy wants a big emergency fund. The key here is to define a dollar amount. How much does Andy spend each month? How many months’ worth of living expenses does Andy actually need? Also, where will Andy be saving the money?

Connie wants to record an album’s worth of music and play a concert. What exactly does that mean? Is Connie shooting to self-release an album? Does she want to play a concert in a small coffee shop or is she dreaming of a big arena? The best goals rely mostly on you for success, so Connie might want to shoot for recording her own album and playing a very small show in a local venue – perhaps any concert will do, or perhaps she can set a goal of an audience of fifty people. She could easily converge the two goals – perform a show with fifty people there and have copies of her CD on hand to sell to the audience.

The key is to change your dreams into something specific and something that relies mostly on your own behavior and not on the behavior of others. Connie, Andy, and Zelda (and me) should spend some time adding details to the big goal, making it as clear as possible what that goal entails (and thus making the steps to get there that much clearer).

What is your goal? You’re dreaming about something right now. Write it down. Tear out the pieces that require reliance on someone else. Then, make it specific – what exactly are you dreaming about?

Figure Out the Big Steps
Once the goal is concrete, it’s time to figure out a plan to get there.

For my goal of writing a novel and some short stories, I need to bone up on my fiction writing. This means prescribing to a steady diet of two things: reading good fiction (to learn technique and style) and practicing my own writing. Thus, my plan should revolve around a steady diet of reading good fiction each day along with focused fiction writing, starting with short stories and later growing into longer pieces.

Zelda needs to start off by developing a garden plan (what will she plant and when), then developing a calendar of the tasks that need to be done over the spring, summer, and fall months.

Andy needs to open an account for his emergency fund and set a specific target for saving each week or month. I recommend making each saving target lower than planned, simply because it’s easier to get into a routine of clearing small hurdles than to struggle at big hurdles, fail, and get discouraged.

Connie needs to get into a routine of writing new music and performing it, building towards a collection of songs that she’s satisfied with which she can record. Home recording is probably the best option here, as it only requires a microphone and recording software.

What is your plan? What steps go into achieving the big thing you want to achieve? Start breaking down the big dream into smaller and smaller pieces until they begin to feel like things you can handle.

Figure Out the First Step
When starting a big project, I often find it useful to set aside a block of time to accomplish a big first step. This way, you can feel an immediate sense of accomplishment as well as some personal investment in the big goal.

For me, this could mean spending a Saturday afternoon churning out a complete short story and reading a certain number of short stories written by others. I’ve been reading quite a few short stories as of late by swapping for short story compilations on PaperBackSwap and hitting the library.

Zelda might want to spend a Saturday afternoon preparing her selected area for gardening. This means calling a few days in advance to make sure she can till there, renting or borrowing a tiller, then turning over the land. She might also spend some time developing her plans as to what she intends to plant, as well as making a stop at the local gardening store to pick up seedlings.

Andy can get started by gathering up his receipts and statements and figuring out exactly how much he spends in a month – and what he can easily afford to save each week or each month. Then, he can open up a high-interest online savings account and then set up an automatic savings plan with that account, automating his savings in that account.

Connie might simply want to seek out a venue where she could play for free or for a low fee (like a local coffee shop) in order to get her feet wet with performing. Then, she could devote some time to developing a set list of what she considers her best songs and practice running through them several times to get the butterflies out.

What is your first step? What could you do on a Saturday afternoon to really get your feet wet with your big goal? Think about it, then pick a day where you can devote several hours to making a real start.

Make Microgoals
Once the ball is rolling, it’s vital that you give your project the regular upkeep that it deserves. One effective way of doing that is to set microgoals – very simple goals that you can accomplish in a few days or a week that move you ever closer to your bigger goal.

For my goal of writing, I’ll commit to a diet of reading ten short stories a week, writing a strong first draft of one, editing an old one to bring it into better shape, and sharing some of those edited stories with friends and family who can provide some solid feedback.

Zelda can set her microgoals by simply making a detailed gardening calendar and sticking to it. Each milestone of planting, watering, weeding, and harvesting is a small goal in itself.

Andy has ready-made microgoals with his automated savings plan, but he could push himself harder by making microgoals of finding additional ways to save a certain amount each month – say, $100. This encourages him to focus on clever ways of saving money and living a bit more frugally.

Connie should make it her goal to run through her complete set list in front of at least one audience member each week, then gather feedback when she can. She should also devote at least a bit of time each day to practicing those songs and developing new ones, with a goal of a certain amount of practice and song development each week.

What are your little steps? What can you do each day to move you closer to that big dream, now that you have a nice start? It only takes a little step to get further along on your journey, after all.

Set Aside the Time
Many people tend to fall behind on such big goals because they can’t seem to find the time for them. My feeling is that if this big dream really is a priority in your life, then it’s easy to find a way to free up half an hour or an hour each day to devote to that project.

For me, I’ve simply set aside half an hour each day to read a short story and half an hour to write a new one or prod an old one. I found that hour by simply getting more focused in my reading. On a normal day, I would spend two hours or so simply reading for pleasure – now I just have one hour of free reading and an hour devoted to making myself into a good fiction writer.

Zelda might find that her gardening project is well served by devoting a few hours each weekend to maintaining her garden. This can easily be found in many people’s lives.

Andy should consider doing much the same as Zelda – spending a few hours each weekend seeking out ways to reduce spending. One great way Andy could do this is by completing a few one hour projects each weekend for a few months, keeping track of what those projects actually save, then increasing his automatic savings by that amount.

Connie should just set aside practice sessions a few times a week, then devote some time on the weekend to playing a full set – perhaps on Saturday afternoon at a coffee shop or on Saturday evening at a local music establishment. One good place to harvest extra time is from entertainment sources – turn off the television, play fewer video games, or stop going out quite as much.

When will you do it? Look for places in your own life where you can free up a few hours on the weekends and/or a half an hour or an hour each day. Cut back on the television intake. Don’t go out after work as often. Reduce your involvement in some activities and friendships that aren’t really fulfilling to you. It’s easy to find that time if you want it.

A Few Final Tips
Here are a few additional little things to help you along.

Let the project provide the joy – don’t reward yourself. When you achieve a microgoal or reach a little milestone, it will feel very good. Enjoy it, but let the joy flow from the project, not from some artificial reward you give yourself. Don’t buy yourself something or do something out of the ordinary because you’ve made it this far – instead, simply revel in what you’ve accomplished to this point.

Share what you’re doing. Start a blog about it. Send emails to your friends about it. Talk about it in conversation. The more you share it, the more support you’ll get from the people around you, the more you’ll think about the progress you’re making, and the more inspired you’ll be to stick with it.

Failure should result in changing your plan, not quitting. Everyone fails on the journey to a big success. The winners are the ones that don’t use it as an excuse to quit. Instead, they use a failure as a tool – an indication that the game plan may be a bit off, that more practice is needed, or something else. When you fail, don’t blame it on the “impossibility” of the big goal. Instead, look for a different route up the mountain.

Good luck!

I am 21 years old and am still in college earning my degree. As of lately I have begun thinking about my future and what I will do with my money. I understand saving is a crucial part of living a successful financial life, but I am confused on how to attack such an issue. I have decided that I will definitely get a Roth IRA, but outside of that I don’t know what else to do with my money. I want to invest in the stock market in the long term most likely a index fund or a portfolio of low risk companies, would that be a form a saving?

I don’t if i should even bother with an online savings account and just focus on IRA and stocks, or should I have all three?

Carl’s certainly headed in the right direction. He’s clearly aware of the value of spending less than you earn and is interested in figuring out the best way to invest the difference.

However, there’s one big piece of the puzzle that’s missing here: what is Carl saving for? Without having clear goals in mind, it’s incredibly easy to make very poor choices when it comes to saving for the future.

Take the Roth IRA, for example. It’s a great vehicle for saving for retirement because, when you reach retirement age, you can take withdrawals from it without any taxes at all. However, it’s an extremely poor vehicle for saving for goals prior to retirement, since you can only withdraw your contributions.

On the other hand, savings accounts can be a great place to put cash if you intend to spend it in the near future. You don’t have the risk of losing value as you do with the stock market and you’ll earn at least a small return on your money.

Carl needs to spend some time thinking about what his goals are. Is he interested in saving for retirement (based on the Roth IRA mention, I’m guessing he is)? Is he saving for something in the short term – for example, is he considering a home purchase in the next year or two? Does he just want an emergency fund so that he can survive in the event of an inability to find a job after graduation? Or is he interested in long term investing (more than ten years or so) that he can use in his thirties or forties for a major purchase (like, say, a home to raise a family in)?

These different goals are wonderfully matched to different investment vehicles. If you want an emergency fund, you should be putting your cash in a savings account. If you want short term savings for goals in the next few years, you should look at short-term treasury notes, bonds, and certificates of deposit – stable investments that aren’t restricted and won’t lose money. If you’re shooting for long term savings (but not retirement savings), look at stock investments, preferably in index funds. If you’re saving for retirement, a Roth IRA is a great vehicle.

It’s likely that Carl is eyeing multiple goals. It’s also likely that, given his youth, that these goals are more long term in nature, but it is always useful to have an emergency fund on hand for any emergencies. I can say this much: if I were in Carl’s situation, just coming out of college with a strong desire to spend less than I earn, I would fully fund a Roth IRA, build up a few months’ worth of emergency fund, then start investing in index funds for longer-term things, like buying a home in my thirties. However, Carl’s priorities may be different.

The real challenge isn’t the actual investing. The challenge is figuring out your goals and knowing where you’re going with your life.

Just like last year, I find myself looking forward to 2009, identifying the things I want to accomplish during that year. Here are the five big goals I’ve defined for the coming year.

My first goal is to eliminate my remaining student loan debt. That’s the only non-mortgage debt we still have, and it’s locked in at a percentage significantly higher than our mortgage. Thus, it’s our big financial target for the coming year.

For us to make this goal, I need to make an overpayment of roughly $1,200 each month on that debt. If I do that, the loan should be completely gone by the end of the year, leaving us with just our mortgage for debt.

My second goal is to write a manuscript for a second book. I want to write more of a “meaty” book for my next one, and I have a lot of ideas as to how to go about it. It’s going to be quite a bit of work – a different kind of work than writing 365 Ways to Live Cheap.

I intend to start this book in the spring. I find that I have more success starting big creative projects in the spring than in any other part of the year – summer is usually filled with a lot of breaks from writing to spend time with my family, fall is very routine-oriented, and winter is usually heavily in the doldrums.

My third goal is to get more involved with local politics. I am interested in running for a local political office in the near future, one that will likely eat up a sizeable slice of time on a regular basis.

I very much enjoy the process of local politics, as it often feels that the decisions you make and discussions you participate in directly affect the community around you. I look forward to the opportunity to get more involved with it.

My fourth goal is to lose a pound a week – a total of fifty two pounds. I’d like to get my weight back to what I weighed in college, which was the point in my life where I felt the healthiest.

The biggest change I’ll need to make to reach this goal is to incorporate more exercise into my life. In early January, I have a few appointments scheduled with my doctor, a dietitian, and a physical trainer to help come up with a reasonable and healthy plan for me to reach this goal.

My final goal for 2009 is to make a strong, concerted effort to let some of the most important people in my life know how important they are to me. I hope to do this in the form of letters and videos and to give these things the time and attention they truly deserve.

There are a lot of people in my life that I care for a lot and it’s often difficult to express to them how much they mean to me. By making this a priority, I hope I can find ways to let them know what they really mean to me.

What are your goals and plans for 2009? Let us know in the comments.

And that’s the key to the paradox of effort: While luck may be more appealing than effort, you don’t get to choose luck. Effort, on the other hand, is totally available, all the time.

A while back, I wrote on a similar theme, arguing that luck happens to those who provide the most opportunities for luck to grow in their life, and pointing out ten things anyone can do to improve their luck.

Seth takes a bit of a different route to a similar conclusion. He argues that the people who get lucky are the people that put forth the extra effort, and he offers a four step plan for making it happen for you:

1. Delete 120 minutes a day of ’spare time’ from your life. This can include TV, reading the newspaper, commuting, wasting time in social networks and meetings. Up to you.

2. Spend the 120 minutes doing this instead:
* Exercise for thirty minutes.
* Read relevant non-fiction (trade magazines, journals, business books, blogs, etc.)
* Send three thank you notes.
* Learn new digital techniques (spreadsheet macros, Firefox shortcuts, productivity tools, graphic design, html coding)
* Volunteer.
* Blog for five minutes about something you learned.
* Give a speech once a month about something you don’t currently know a lot about.

3. Spend at least one weekend day doing absolutely nothing but being with people you love.

4. Only spend money, for one year, on things you absolutely need to get by. Save the rest, relentlessly.

All four points are valuable life lessons, but I wanted to focus in on the first two because the point there is near and dear to my heart.

If you can devote two hours a day to improving yourself and doing something to change your situation, your life will improve. Period.

All I have to do is roll back the clock two years to provide some proof of this. In October 2006, I was recovering from our financial meltdown, dreaming of a career as a writer and of owning our own home, but not really doing anything about it. I was twenty eight years old and I realized I was watching my life drift by.

So I started The Simple Dollar, and I started devoting about three hours a day to it at first. It took me a few months to find my writing legs – many of my early posts sound quite a bit different than what you’d read from me today. But I kept hammering away at it. I worked on getting better at brainstorming and quickly transforming those ideas into something readable. I learned how blogging worked. I interacted with a lot of readers and potential readers and learned what they were out there seeking.

Two years later, it’s changed my life. I’m now doing it. I’m writing full time, something I barely dreamed about two years ago.

Now, I’m left thinking about the next big thing I want to tackle. Can I pencil off two hours a day and do something big like that again? I’ve had a lot of ideas floating through my mind as of late, but Seth’s post kicked me in the rear end and got me thinking.

So, how can you do it, too?

Finding 120 Minutes
In Seth’s words:

Delete 120 minutes a day of ’spare time’ from your life. This can include TV, reading the newspaper, commuting, wasting time in social networks and meetings. Up to you.

What can you delete from your life? Don’t just blow off the question. Think about it for a minute.

I know that the single biggest thing I could delete from my life is the time I spend browsing political blogs and websites. It’s almost an obsession for me at times, and I don’t get anything out of it except for more indignant and angry. If I really wanted to be politically involved, I could spend that time campaigning for the candidate that I want – or doing something to personally improve myself.

Seth names several other options. Television is a big one for many people. I know one guy who finishes each day going out to the bars for two hours – and he doesn’t even get a drink. He just hangs out with the boys. I know another woman who spends at least three hours a day reading absolutely trashy romance novels.

It’s often the people who waste that time that wonder how come others are successful and get promotions. Are they lucky? Or are they just committed to the details.

Look around your life. Look for the things you can eliminate. If you can come up with two hours a day, you have a serious block of time to commit to success.

Using 120 Minutes
So what are you going to do with that time? Seth’s suggestions:

* Exercise for thirty minutes.
* Read relevant non-fiction (trade magazines, journals, business books, blogs, etc.)
* Send three thank you notes.
* Learn new digital techniques (spreadsheet macros, Firefox shortcuts, productivity tools, graphic design, html coding)
* Volunteer.
* Blog for five minutes about something you learned.
* Give a speech once a month about something you don’t currently know a lot about.

That’s a very good list of things, but they all assume an entrepreneurial goal. I suggest something a little bit different.

What’s your dream?

We all have one big thing we would like to change in our lives, or one big thing we’d like to accomplish. After some reflection, I’m starting to settle on my next goal, something I’d like to accomplish in 2009. I don’t want to talk about it yet, but I know what it involves.

What could you do with those two hours a day to carry you closer to that goal?

You want to improve your career? Spend two hours a day mastering basic skills related to what you do and absorbing more information. I have several friends in life sciences. One of them spends two hours every single day reading and re-reading the latest scientific papers that come out. He does this in the evening, after his lab work is done. Do you want to guess who’s slowly starting to seem like the expert on his field of research in his lab? Do you want to know who’s starting to make a name for himself at meetings?

You want to improve some aspect of your life – perhaps you’d like to lose some weight? Start walking. Seriously. Walk for an hour. If you can cover a mile in twenty minutes, you can walk three miles. Get up a little earlier and do this before work instead of sitting there dead-eyed watching the Today Show and dreading work. When you get home, instead of flopping in front of the television, put on some walking shoes and a jacket and go for a very long stroll.

You want to become a respected member of the community? Volunteer two hours a night. Offer to take tickets at high school athletic events. Go to city council meetings. Go to school board meetings. Leap at the chance to participate in things. Join a civic organization or two and get involved with them. You’ll start seeing people over and over again and eventually you’ll start to get to know a lot of them. Before long, you’ll see the rewards of that effort – when you go out in your town, tons of people will shout out hellos to you and when you need help, you’ll have tons of helping hands.

If you can find that 120 minutes and you can use it every day to make a change, you can have that dream. The only difference between you and the person actually making it is the willingness to sacrifice that time each day.

Is your dream worth giving up that hour of television?

Ramit Sethi

The article gives six distinct reasons for why the writer doesn’t want to be a homeowner, each of which are worth some commentary.

We’re too poor to buy a house. Our total household income is only around $55,000 a year. We hold stringently to idea that we should never have a mortgage which is more than double our annual income. We do that because we feel being house-poor is not a good idea, and could unnecessarily tie us down.

Liquidity This is a pretty sound economic reason, and also part of the reason why we elected to purchase a more modestly priced home that was about 1.8 times our combined annual salary (at the time). Note that this does not preclude them saving for a very large down payment – if you can save up $90,000, they could then get a $110,000 mortgage and buy a $200,000 home.

There are no safe, “nice” neighborhoods in our side of town which have 3 bedroom or larger homes available for $110,000. We’re not interested in moving to outlying areas because we have a business in this neighborhood, and value our time too much to waste it commuting.

Environment They prefer to live in the general area that they currently live in, but housing prices have made home ownership in their area quite expensive – far over $110K for the home that they wish to purchase. It’s worth noting that this article was originally written in 2001 – they likely saw far higher prices by 2005 or so.

We can’t earn more than around $50-70K a year because I lack the drive to spend too much of my time and energy earning money. I have too many other interests. I’m happy with making enough to get by.

Diverse interests The author understands clearly who he is and knows that his passions don’t lie in chasing the brass ring. Instead, he follows his diversity of interests and doesn’t worry about earning more and more money. Whether that’s a good choice or a bad choice will depend on your own beliefs – my feeling is that there are different paths that are right for each person and it takes a strong person to know which path is right for him or her.

My wife doesn’t work for money by choice. She educates our children, reads lots of books, gardens, does genealogical research, cooks from scratch everyday, and gives many hours of service to a women’s organization.

Stay-at-home parenting / personal choice The stay-at-home parenting choice is one that my wife and I struggled with for a long time – and we’re somewhat doing it now, with my writing career. Again, this is a choice that has no easy answer, regardless of what either side might say about it, and it takes some fortitude to simply put your foot down and do what you truly believe is right, regardless of the other consequences.

Which brings up another point: we don’t have any spare time in our schedule for home repair, maintenance, or upgrade projects.

Time management Actually, more than time management, it’s a confession that the person has no real interest in taking care of their property. While I find that somewhat disheartening (often, someone unwilling to maintain their living quarters is often unwilling to maintain other parts of their life, too), it’s again honest and straightforward.

And finally, we lack the discipline to save for a downpayment. Every time we get $5,000 to $10,000 together, we go and blow it on another family vacation.

Lack of discipline / other desirables This isn’t so much a lack of discipline – they are able to save up to five figures – it’s a matter of finding the gratification of a family vacation to Disney World followed by a year of renting higher than a family vacation camping followed by home ownership.

The Real Reason
On paper, this individual seems suited for home ownership. There’s a steady income, a tendency to save and spend less than they earn as a normal course of events, and a family situation where housing stability might be at a premium. Yet, through some self-evaluation, the family determined that home ownership wasn’t right for them. Why?

They have different goals in life.

Their goals certainly don’t match mine. I’m very proud to be a homeowner and, since my local area never really had what I wold call much of a real estate bubble, the home will hold value. I love to camp and I don’t have much interest in expensive vacations for my family, at least not until the children are old enough to deeply appreciate it. Those two philosophies alone put me in a different camp than the author of that article.

But what’s really key to notice here is that they set goals and achieved them – they just happened to be different goals than I do (or perhaps you do). Their goals revolve around expensive family vacations and having a stay-at-home parent – and those goals have both notable benefits and drawbacks.

And they’re meeting those goals. They’re regularly spending less than they earn so that one parent can be a stay-at-home parent and so that they can go on nifty family vacations.

Their life may appear different on the surface, but the fundamentals under the hood are the same. Set goals. Spend less than you earn, and sock away the difference.

That will take you to your dreams, no matter what.

It was a cute movie with a pretty thoughtful premise – the idea of the “bucket list” itself. Like a million other viewers of the movie, I was anxious to make my own “bucket list” – and so I did. Here it is, for all of you to read.

Spend more than a week in a rural part of France.
Spend more than a week in a rural part of Italy.
Drink a bottle of 1982 Latour, Pauillac wine with my wife and some friends.
Run for a significant political office.
Write the novel I have inside me – and get it published.
Visit Petra.
Run a marathon.
Do a three week gastronomic tour of America, a la Feasting on Asphalt.
Dance with my wife and with my daughter on a special evening.

Those were the nine I wrote down, anyway. Some may seem silly to you, but those are all things I want to do before I pass away.

We all have “bucket lists” of some sort, but for most of us, these things remain just a list of dreams, likely to be unfulfilled. It’s fun to think about them and make lists of these things, but for many of us, such things often lay in the realm of dreams. Take my list, for example. Does it seem sensible or frugal to drink a $2,200 bottle of wine (yes, the 1982 Latour, Pauillac goes for that much)? Do such things really matter in the greater context of our lives?

Experiences are something that’s easy to overlook in the cut and dried world of personal finance. Tight budgets and careful saving rarely leave room for powerful and life-altering experiences, so we tend to tuck them away, intending to do them someday.

When we look back on our lives, however, it is the experiences that we remember. We don’t think fondly about that iPod we bought in 2003; we think about the night we danced in the backyard with our spouse under the moonlight. We don’t recall all of the things we fritter our money away on, but we remember the big moments, those experiences that changed our lives.

In the end, a “bucket list” is merely a list of experiences we wish to have, and just like any other dream for the future, there’s no reason to not start planning now for your own bucket list – experiences that cap your own fulfilling life. Here are six steps that will take you from where you are now to grabbing ahold of your bucket list.

Give some consideration to your “bucket list” – the list of great experiences you’d like to have before you die.
This is actually quite fun. While I constructed mine, I just kept a few pages in my pocket notebook devoted to it. I’d add ideas as they came to me and scribble off other ones after some reflection, and after some time with some very nice daydreams, I came to the list above.

The process itself was very valuable. It provided a big prod for me to spend some time thinking about the experiences I dream of having in my life. Along the way, I brainstormed a lot of things, spent some time deeply reflecting on dreams I once had (and maybe don’t have any more), and realized that most of the things on my bucket list are things I want to share with my wife and my children. Great reflections, indeed.

Identify one (or perhaps two) items from that list that seem the most reachable.
Obviously, your “bucket list” is not something you’re going to be able to just start running through, like a checklist (that’s the humorous part of the movie, actually – they run through many of those items like a person might run through a grocery list). Instead, just pick out one or perhaps two of the items to focus on right now – leave the rest for a later time.

For me, I decided to focus on writing the novel and going on a gastronomic tour of America. Both of these seem possible in the next few years. The wine one was also tempting, but honestly, I’d like to do something with that with my children and their spouses in about twenty five years. I might consider saving up and purchasing the bottle at some point, but I’ll hold it for the right moment.

Flesh them out into full-fledged long term goals.
So, now we have two items off our “bucket list” that we’re intending to do. Now what? The next step is to flesh those goals out into something tangible and specific. Specify exactly what that bucket list item is and figure out when your target for getting it done is.

I’ll take my goal of writing the novel as an example. I’d like to be able to accomplish that in five years and I think it’s a reasonable timeframe. So I’ll spell it out clearly – I want to write and publish a strong novel in five years’ time. That’s a very clear goal now, not just something vague on my bucket list.

Start developing short term goals and microgoals that build a road to that item.
Now that it’s a clear long-term goal, I need to figure out the little steps to get there. The first step is to get my fiction writing chops in gear, and that simply means writing more fiction. To get in gear, I’ve decided to commit to writing a short story a week, polishing up another one each week, and then sharing them with my wife, who is my best critic for writing, and others, too.

These little baby steps are just the push I need to start moving forward with this. They not only will tangibly improve my skill at writing fiction, but it will also force me to expose my fiction writing to others, which is actually the hardest part for me. Eventually, when I start writing fiction that clicks, I’ll start by entering some short story competitions, but for now, my microgoals are mainly there to keep me writing fiction.

Make those little steps a priority.
Now we have these little goals in mind, but it’s easy to just leave them on the table and forget about them. There’s a lot of other things going on in my life – why not just leave that little goal on the table this week and forget about it? Why not do something really fun instead, or do something that will eventually earn me some income in other areas?

The real trick here is to keep how much you want that big dream in your mind. By sitting down and working on a short story or editing one, I’m taking a little step towards that big dream in my mind. Simply setting aside an hour or two a week to focus on this – and maybe a few lazy hours in the evening when everyone else is asleep – will make that goal come ever closer to reality.

Rinse and repeat.
Once you’ve got the basic steps down, it’s a matter of doing it over and over again – making those little steps a natural part of your routine. Maybe it’s setting $20 a week aside for some sort of big, momentous goal. Maybe it’s a little task you need to accomplish. Whatever it is, make a steady effort to do it over and over again until it becomes completely natural.

Before you know it, you’ll be happily marking something off your bucket list – and you’ll have a life-altering experience to savor for the rest of your years.

Will you ever reach your goals? And what will you do when you get there?

I’m a goal-oriented person. I find it much easier to accomplish the things I want to do in life if I set clear milestones and aim straight for them. One big aspect of my personal finance success is that I began to set goals that focused on getting my money straight – before my turnaround, I used to focus on other things.

I have small goals, like my list of 101 goals in 1001 days. I have big goals, like complete debt freedom, financial independence, and raising emotionally and intellectually centered children.

These goals drive me on a daily basis. Each day, I get up intending to push myself towards one or more of these goals, and every once in a while, I feel the relief of accomplishing one or more of them.

What happens, then, when I reach my goals? Where will I be at if my children grow up and have healthy and normal lives, I’ve achieved financial independence, and I’m completely free from debt?

I move on to new goals, ones that I’m not able to reach for right now because I haven’t achieved enough in life yet.

I would love to spend a few years doing volunteer work in a poverty-stricken nation, where people don’t have access to the basic food and water they need. I would love to be able to work for a foundation that pushes for basic personal finance education in all schools. I would love to be able to just drop everything and write the novel I know I have inside of me. I would love to be able to start a granting agency to financially support and promote people who go beyond the call of duty in their lives for social work – something of a MacArthur Genius Grant for social work.

But I’m not there yet.

These dreams are the really big ones, the ones I won’t be able to reach for for twenty or thirty years. These are the dreams I have that might just help change the world. But they require me to have a platform of support that I can leap from.

To a degree, I’m working towards one of them now. My dream about pushing for basic financial education in schools is coming true in part because of The Simple Dollar, and I’m going to do a few things over the next year or two to push that idea even further.

What do these things have in common? They all seek to uplift as many people as possible through communication. It’s a common thread through almost every big life-altering dream I have.

Some people refer to this general idea as a vocation, that your career is just one element of your true role. I look at it this way: what is the purpose of your life? It’s a difficult question for many people to answer, and I’ll confess that sometimes, when I’m troubled, I wonder what my purpose is, too.

So, will I ever reach my goals? Probably not, because each goal I have is just another step in a life’s journey. I’m just thankful that I have at least some semblance of an idea where I’m going and why.

Just sit down for a minute and think about it. What do you want to do with your life? Do you have an answer? Mull it over in your head for a few days, and realize that you have many, many years ahead of you to make it happen. If something begins to take shape in your mind, think about what you can do to get there. It starts with a goal for tomorrow, a goal for next month, and a goal for the next decade.

Your money and your career are just small parts of that bigger picture. Good luck in finding it.

These are all apt definitions of financial independence, perfectly applicable to different points in life and each useful as a goal for some people. Let’s take a look.

Freedom from financial reliance on loved ones
This is a freedom that many young people earn in their late teens to mid twenties, as they get through college, earn a degree, find a job, and separate themselves from their parents. For many people, this is financial independence. They strive to be their own person, independent of the people around them, capable of standing on their own two feet.

I achieved this goal at age twenty-three, after graduating college and moving on to a well-paying job. I partially achieved it at age eighteen after departing from college – other than holiday trips and one very long summer when an internship fell through, I didn’t live at home after that, I had steady work that provided income, and scholarships and loans took care of the college bill, though my parents did assist with little things fairly regularly during my college years.

Setting it as your goal If you can survive for a significant period of time (multiple months) without going rapidly into debt or without a steady cash infusion from your family, then you’ve achieved this goal. Generally, it requires a decent job, a commitment to keeping that job, and a desire to actually move on from a state of dependence.

Freedom from financial reliance on creditors
This freedom occurs when you are completely free of debt. No mortgage, no student loans, no car payments, no anything. Aside from taxes, you’re free to do what you want with all of your income. This is often used as the definition of financial independence by writers advocating a strong anti-debt position.

I haven’t achieved this goal as of yet. I am rapidly moving towards it, however. Since mid-2006, I’ve eliminated $17,000 in credit card debt, $6,000 worth of auto loans, and $19,000 worth of student loans, fueled by both personal frugality and earnings from The Simple Dollar. Currently, we have about $24,000 in student loan debt to tackle, then our mortgage (at about $170,000, all told). We’re attacking that debt as vigorously as we can, with large advance payments on the student loan debt going out every month. When we get down to just the mortgage, we’re going to start investing as a method to pay it off, as we believe we can earn more by investing our money than by making early payments against a rather low interest rate.

Setting it as your goal Setting this type of independence as your goal takes a strong commitment to the “spend less than you earn” philosophy. You need to be willing to directly put some of your income straight into large debt payments in order to get rid of that debt. This requires enough income to cover your basic expenses and more, a good grasp on how to control your spending, and a debt repayment plan that you’re committed to executing. If you’re willing to take on all of this, then you’re probably ready to take on this goal.

Freedom from financial reliance on employment
Many financially stable people view this as true financial independence: an end to the financial reliance on employment. It doesn’t mean you have to stop working, it just means that income from your work is no longer a requirement. It appears under many names: retirement and “walk away from it all” money are two of the most common ones.

I haven’t achieved this goal yet, either. My wife and I have a lifetime financial plan that involves debt freedom, building the house in the country that we’ve both dreamed of since we were young, and then heading towards this type of financial freedom (hmm… this plan alone might make for an interesting article).

Setting it as your goal Many of the same principles for debt reduction apply here. Spend less than you earn and invest the rest of it for the long term. Work on maximizing your income and minimizing your spending and sock away that difference. This means not only maximizing your career, but maximizing your frugality, too – know the real value of your time and do things with that time that produce value.

Financial independence is a great goal, but as with any goal, you have to define exactly what it means for you and then define a plan to meet that exact goal. Without that exact definition, you’re just whistling in the dark.

While it’s grown beyond that original plan, it certainly has fulfilled the motivational part of the goal. I’m motivated every day to keep my finances in line, to the point that it’s become an integrated part of my life. It may have happened without The Simple Dollar, but the motivational factor of putting my situation out so publicly was an enormous motivator.

The best part is such public motivation can be done by anyone and can be applied to any goal. Here’s how.

Define Your Goal
The first step in achieving something is to clearly state what you’re trying to achieve. What are you aiming for?

Figure out what you want to change. Most of us already have this part figured out. We know what we want – we want better health, a better figure, a greater financial life, a better job, a business of our own. The problem is that goals are often nebulous and thus are easy to pass through – just like a cloud. So, once you know the change you want to implement…

Define exactly what it means to achieve that change. If you want to lose weight, figure out your target weight. If you want to improve your financial state, figure out a target debt level or target net worth. Want a better job? Define exactly what that job is. Know exactly what your goal is and exactly how you can determine if you’ve made it.

Devise a plan to take you to that exact goal. Now that you have a specific goal, what steps do you need to take to get there? Let’s say your goal is a specific net worth. That means you need to reduce spending, increase your income, or both. What’s your plan of attack? What about a target weight or BMI? That will likely involve dietary changes and an exercise regimen. What’s your plan of attack?

Define Daily (or Near-Daily) Metrics for that Goal
Once you’ve got your goal specified and have a plan in place to reach that goal, you also need to define very specific microgoals along the way. Losing fifty pounds is not something you can grab ahold of today, but losing one pound is. Exercising for thirty minutes every day isn’t something you can grab ahold of, but exercising just today for thirty minutes is something you can do.

Look at your specific goal and your plan to get there. What sort of regular, repetitive steps will you have to take to get there? If you need to eat better, your regular, repetitive step comes with each meal. If you need to exercise, your regular, repetitive step is a daily (or near-daily) exercise session. If you need to start saving, a spending log is perfect. If you need to start building up your resume or just learn something new, learning something each day and documenting it is a great way to go. A musical instrument? Daily practice is perfect.

The point is to define those tiny steps you need to take each day. Make them small enough so that you actually can take those steps each day and you’ll find yourself walking right toward your goal.

Announce Your Progress with those Metrics to the World
One big problem, though, is motivation. How can you keep motivated to take those small steps? Some people have that internal motivation, but others are often driven to be motivated by others, and that’s when online tools can help.

Twitter is a great way to publicly log your progress. Twitter lets you publicly post quick reports that are 140 characters in length – perfectly long to note spending, eating, a daily weight check, learning, your daily practice, and so on. If you’d like to write longer entries, starting a free blog like the one at Wordpress is a great way to go. Putting it out there publicly means that some strangers might visit, but you can cover that up by being fairly anonymous – using just your first name, for example. Even better, strangers often provide great motivation in the little comments that they make.

This daily logging routine is a way to provide a check against yourself. Did you do what you were supposed to do today? Did you take that little step towards your big goal?

The real motivator, though, is letting your friends and family see it. When you start, send out that URL to supportive family and friends and ask them to take a look and keep tabs on it. Almost any caring family member or friend will happily do so and probably send you supportive notes along the way. It takes some personal courage to share things in this fashion, but the rewards are great – you’ll find yourself with a support network that’s intimately familiar with your progress, knows what your goal is, and best of all knows you well and cares about you. These people can be the best motivators of all.

How I’m Doing It
I’m actually using Twitter myself for this very thing. Recently, my wife and I made a strong commitment to get into better shape, and I elected to track my progress publicly on Twitter. I set up a fresh new Twitter account and am posting brief updates each day on how I’m doing. To up the pressure on myself, I shared the link with friends.

And now I’m going to up the pressure even higher.

http://twitter.com/trenthealth

That’s my health log in Twitter form. That’s right, I’m revealing my daily BMI, diet, and exercise progress to 50,000 readers. If you’re interested in following along, bookmark it. I estimate it’ll have 5-10 quick blips a day.

My goal with it is to use Wii Fit, the lifetime fitness ladder, and a better diet (basically following Michael Pollan’s guidance from In Defense of Food) to push myself to two goals: a BMI of 22 (which my doctor recommended as a good long-term target for my body build – I’m 6′6″ and have the shoulder width of an NFL linebacker) and to consider riding a leg of RAGBRAI next year. I anticipate both goals taking a year or more, actually.

We’ll see where I get, but I can certainly say this: the idea that there are many friends and readers watching is both an exhilarating rush and also makes me a bit nervous. Having that many eyeballs on my progress is one big motivator.

When I was young, I made the hard choice to reject the culture of most of the adult males in my life and instead devote my time to reading and self-education. That resulted in the opportunity to go to college, educate myself, and chase dreams that would have been far out of my reach otherwise.

When I was in college, I made a difficult decision to walk away from my entire social circle – people who were bending me down with negativity. Without that choice, I would have never cultivated the relationship with the wonderful woman who would become my wife.

When I was near my financial meltdown, I made the hard choice to reject a heavily consumerist lifestyle and start saving money. That resulted in me getting rid of debts, finding some financial freedom, and being able to sleep at night.

When my writing career began to launch, I made the hard choice to quit my real job and let that rocket lead me wherever it might go as well as free me to spend a lot more time with my family. This has given me a level of day to day freedom as an adult that I could have scarcely imagined a few years ago.

Recently, I made another very hard choice – one that I’ll talk about again in a few months once the ramifications of it start to become clear.

Every single one of these choices was hard. I didn’t want to make them – in fact, in each case, I avoided actually making the decision for far longer than I should have. In each case, though, once I finally made that hard choice and committed to sticking to it, my life made a big turn for the better.

On the other hand, when I look back at my life and think of the big choices where I made the easy choice, they didn’t turn out so well.

I made the easy choice when it came to my college major. Instead of seeking topics I was passionate about, I stayed in my early major choice for far too long – I found it interesting and sometimes exciting, but I never bothered to find my burning passion.

I made the easy choice (through most of my life) when it came to my spiritual beliefs. Early in life, I bobbed along to my parents’ mix of agnosticism and lapsed Catholicism. Later on, I followed people through various churches and religious groups. It took a lot of introspection to go beyond being a follower and figure out what I actually believed – and realizing what that meant in terms of organized religion.

I made the easy choice when it came to friends. For much of my life, I just settled for whatever people were convenient instead of trying to find people I genuinely connected with. The end result was only a few people I can genuinely call lifelong friends.

The easy choice is just that, easy. But you have to live with the consequences of it.

Some inspiration:

Two roads diverged in a yellow wood
And sorry I could not travel both
And be one traveler, long I stood
And looked down one as far as I could
To where it bent in the undergrowth

Then took the other, as just as fair
And having perhaps the better claim
Because it was grassy and wanted wear
Though as for that, the passing there
Had worn them really about the same

And both that morning equally lay
In leaves no step had trodden black
Oh, I marked the first for another day!
Yet knowing how way leads on to way
I doubted if I should ever come back

I shall be telling this with a sigh
Somewhere ages and ages hence:
Two roads diverged in a wood, and I
I took the one less traveled by
And that has made all the difference
- Robert Frost, Road Less Traveled

Tactics for Making the Hard Choice
Here are some things that helped me make all of these hard choices in my life.

Imagine your future self if nothing changes. When I was a teenager, I often visualized my future if I didn’t make a concerted effort to focus on my education. I imagined a future where I stayed in my small town and worked at a factory job, probably coming home each night and drinking to excess, something I witnessed over and over again. It was a future I didn’t want – a future that really frightened me. I used that picture in my mind for motivation over and over again.

Imagine your future self if you do make the change in the best case. Before quitting, I imagined my life if my writing career took off like a rocket ship – and it was a good picture. The house in the country my wife and I had always dreamed of, the ability to usher my kids off to school each morning and be there for them when they get home, and lots of other little details. It made me feel genuinely happy inside.

Imagine your future self if you do make that choice in the worst case. In that same scenario, I imagined myself having to go back to a nine to five job in a couple of years. But, even then, I got to spend a lot of time with my children during their formative years and I have the good feeling that I got to chase my dream and I wouldn’t have to live with the regret of having not given it a shot.

Compare that worst case to not making the choice at all. Ask yourself genuinely if the worst case is really worse than not doing anything at all. If it’s not, then you should make the leap immediately. If it is, that’s the time to do some serious soul searching and evaluation, but don’t walk away from the choice – great reward does not come without some risk.

Use the “first thing in the morning” test. What are the first things you think about in the morning when you wake up? My first thought when I wake up is usually about my wife and children – often, my son is jumping around on the bed and my daughter is laying there yelling “DA DA DA DA!” (her favorite exclamation at the moment). Once I’ve wished them both a good morning, done a diaper check, and have some idea of their clothes for the day, my next thought usually revolves around writing. The same was true well before my career choice. In a nutshell, the first tasks you think about during the day that don’t fill you with dread are the tasks you should be focusing your life energy on – and if it requires making a difficult choice to get there, it’s a difficult choice you should be making.

Ask for help from your inner circle. The people around you can be incredibly helpful if you’re trying to make a difficult change in your life. Ask them for help and support when you make a challenging choice. My parents were extremely supportive with my educational choices. My wife was incredibly supportive and cooperative when I wanted us to make some financial changes and when I made a career change. The people around you are your support staff – let them support you when you need it.

Good luck in whatever you choose.

And these meetings have become a big part of the financial glue of our marriage.

These conversations keep us on the same financial page and ensure that we both are open and clear about our goals, our dreams, our mistakes, our challenges, and our shared path in life. They let us constantly be a check against one another, making sure we both stick to our better behaviors and use each other as an inspiration for making good choices. If you’re in a long-term relationship with someone, I can’t possibly recommend a monthly financial meeting more highly.

What Our Meetings Look Like

Our meetings are really pretty simple. We go through any credit card statements and bill statements that we have, talk about any changes we should make, plan for anything that’s coming up, and set some goals for the next month, mostly along the lines of limiting unnecessary spending and deciding where our budget leftovers will go for the next month.

For the most part, we don’t need any sort of specific agenda or meeting time – we just do it every once in a while on roughly a monthly schedule. Some keys:

Everything is an open book. There should be absolutely no secrets in such a meeting. If your spouse wants to know about a specific spending choice, be completely open about it, not defensive. If you’re getting defensive, that means you have something to hide – and that means there’s a problem that needs to be addressed together.

Make goals a big part of the meeting. Not only big, long-term goals, but the shorter goals over the next month that will help you get there. Set goals together, even if the goals are very individual in nature. Then, throughout the month, offer each other encouragement. It’s hard to break a bad spending habit or to make new financial choices – use the motivation of goals and the constant encouragement of a loving partner to make the changes easier.

This is a great time to work on a simple budget together. Sit down and talk in detail about your spending plan for the coming month – and also where your challenges and successes were over the last month. This discussion can provide a lot of insight into where you’re going – and where you’ve been – and that information together can help you to make better financial choices.

Love and respect each other, even if you have differences of opinion. Money brings about strong feelings – don’t let these strong feelings overshadow the more important things in life. One good way to do this is to hold your partner’s hand during the meeting.

Involving the Kids

I am a big advocate of involving children in these meetings as early as possible, by age seven at the latest. Allow them to bring their own financial picture to the table – pay them an allowance, have them budget the money, and have them talk about their own successes. Here are some thoughts on how to incorporate kids into this picture.

Keep the open book philosophy. Everything should still be wide open so that your kids can see the financial reality of being adults. They need to know how much you’re spending each month to keep the roof over their head and the food on the table – as well as giving an idea of all of the little expenses that eat away at the big pile of money.

What about privacy? Many parents like to hide behind a veil of privacy, saying that it’s none of their children’s business how they spend their money. My argument against that is twofold: first, it makes a great educational opportunity for your kids impossible and second, it says that there’s something in your spending that you’re ashamed of. If there’s shame, that means that there’s something you personally need to improve in your life.

Naturally, I see no problem eliminating a few items with black highlighter in order to hide an upcoming gift or something, but if you’re sealing away most of your spending from your children, they’re missing out on a big learning opportunity.

Let them offer input towards goals – and have them set their own. When you’re making large financial choices, let them have a voice in the decision, but don’t let them run the show, either. Where you should allow them a lot of control is in setting their own goals, both over the long term and over the next month. Help them identify good things to save for and encourage them to work towards those goals. This goes hand in hand with the idea of splitting an allowance into pieces for spending now, sharing with others, and saving for later – in effect, budgeting for kids.

Make some of the economic choices you have available to them. This is a concept heavily advocated by David Owen’s excellent book The First National Bank of Dad. In it, Owen advocates that you should create a “virtual” bank for your kids with a very high interest rate – say, 5% a month – to teach them the value of saving very early. In other words, let’s say they have $20. They have the choice of putting that $20 in the “First National Bank of Dad” where it will earn $1 in interest every month, or they can spend it immediately. All they have to do to earn that $1 each month is simply not spend it. It’s a real choice for a young child and it introduces them to the dilemma of saving versus spending – and offers plenty of encouragement to make the “good” choice.

In The End…
At its core, the idea of a monthly money meeting is really all about communication. The more we talk about money with our family and the more we encourage each other to make good choices, the more likely we are to make good choices over the long haul. Even better, it’s a splendid opportunity to use ourselves as examples for our children, teaching them how to be financially responsible adults.

Ever since I was a little kid, all I’ve wanted to do was play professional golf. I can’t dream of a better life than playing golf for a living, or even working in some way professionally in a way connected to golf.

Right now I work in an office and the closest I get to this is playing a couple of rounds each weekend. During the week, I’m too busy to hit the greens.

This makes me depressed. I hear you talking about reaching your dreams and I’m happy for you, but then I look around my office and I see mine slipping away and I get sad.

All right, a confession.

I fail at writing. A lot.

I’ve been writing in my personal journal every single day since 1991. When I started digging into my writing passion (writing in a little leatherbound journal my grandmother got me for Christmas 1990 when I was only twelve years old), I read that one should write at least 1,000 words each day. So I have. Since January 1991. Every. Single. Day. At this point, I’ve been writing 1,000 or more words a day for the majority of my life – and it’s usually more words. Way more.

In high school, I entered essay competitions and other contests and did middling at best. I probably would have given up then, feeling much the same way our friend here feels like giving up, if it hadn’t been for the constant and often subtle encouragement by my high school English teacher. Randy, if you’re out there reading this, I wouldn’t be writing for a living right now if it wasn’t for you.

I kept it up in college and in my early professional life. I wrote two full novels and a pile of short stories. I had a few glimmers of success with it, even going so far as to get what I considered to be a very strong bite from a publisher in 2003, but most of it was a pile of rejection letters. Failure, over and over again.

I kept writing. Why? I loved it. I still love it with every ounce of my being. I love writing short stories. I love writing essays. I love making words flow together. I love how they transfer meaning to someone else, to people I’ve never met and will likely never meet.

Finally, after seventeen years of this, I’m finally seeing a little bit of success with writing. Why is this happening? There are a lot of reasons: I intentionally write very conversationally, which works well on the internet; I’m writing about a topic that’s near to people’s hearts; and I have a lot of great readers who help me out and inspire me over and over again.

There’s another piece, too. I practice. I’ve written and edited so many things over the years that now the actual art of taking an idea and turning it into a written piece fits on me like a familiar glove. It’s only because of that familiarity that I’m able to write so much for The Simple Dollar – two original columns a day – plus freelance stuff elsewhere. Because of that practice, I am now pretty fast at brainstorming, separating the bad ideas from the good, organizing a good idea into a series of logical points, and fleshing out those points into a written piece.

Great. But that doesn’t help me with my dream.
But it does! There are a ton of lessons in that story that can help anyone with any dream that they want to achieve. Let’s walk through them and see how they fit into my story, into Brad’s story … and into your story as well.

Passion.
Every single morning, when I wake up and lift my feet out of bed, two things cross my mind. The first one usually is a thought related to my wife and my kids – my immediate focus is on getting everyone up, getting them dressed, making sure they’ve eaten something nutritious, and getting them started on their day.

The second thought, though, always revolves around writing. I think about crafting sentences and pulling together ideas. I think about the written word in all of its varieties.

I yearn to write. There are times when I am almost magnetically pulled to a keyboard or to a pad of paper – there’s an idea floating in my head and I have to start recording it.

That’s what passion is. It’s the things in your life that you’re drawn to over and over again. It’s the things that you can scarcely go a day without doing – or at least wanting to.

Brad’s golfing is a perfect example. Every day when he goes home, he yearns to golf and it tears him up not to be able to act on that passion. He has that first piece in hand – he knows dead-on what he’s passionate about.

I have another friend who is incredibly passionate about chess. His home is littered with chess boards, magazines, and books. I finally saw how deep his passion went when I discovered a chess set in his bathroom so he could work through problems while doing his business.

What if you don’t know what you’re passionate about. Not long ago, I listed in great detail seven steps to finding what you’re truly passionate about. Here they are in a nutshell (but that whole article is well worth reading):

1. Maximize your health
2. Ask questions
3. Ignore what’s “cool”
4. Dabble in everything
5. When something piques your interest, try it again – and again
6. Associate with people who share this burgeoning interest of yours
7. Don’t keep pushing it if the passion dries up quickly

Keep doing those steps and you’ll find your passion – or it will find you.

Practice.
I like watching basketball players practice. I’ve watched bad coaches lead practices, mediocre coaches lead practices, and good coaches lead practice.

At first, I thought that basketball practice was about intense scrimmages. I thought that the best way to coach would be to have your team run complete plays over and over again with the coach pointing out flaws and correcting them. In essence, I thought practice would be much like a game with the coach shouting instructions.

Wrong.

The best basketball team I’ve ever seen would have two and a half hour practices – and only scrimmage for ten minutes or so at the very end. Most of the practice was filled with very repetitive drills. They’d sprint from one end of the court to the other to do a layup. They’d run the same exact screen a hundred times. They’d all shoot fifty free throws. They’d do endurance sprints. In other words, the intense part of their practices were nothing like playing a game of basketball – they were instead a bunch of focused little pieces on specific attributes of playing basketball.

I got the opportunity to ask the coach why this was and he made it very simple: these kids would play basketball for fun all the time anyway, so scrimmages were kind of a waste of time. Instead, it was much more important to work on very specific fundamentals.

In other words, practice isn’t just about doing something over and over again. It’s about focusing in on very specific elements and techniques, hammering them in over and over again, and then seeking out feedback on that technique.

Not long ago on the New York Times Freakonomics blog, Stephen Dubner wrote about the value of using deliberate practice to make oneself very good at a particular skill. He broke such practice down into three pieces:

1. Focus on technique as opposed to outcome.
2. Set specific goals.
3. Get good, prompt feedback, and use it.

When writing, I do this by writing on a bunch of different topics. I write articles and guest postings on all sorts of topics. I write short stories. I try mixing up what I do and taking on new things. In order to get feedback on this stuff, I post it online in various places – sometimes as guest posts on blogs, sometimes on community sites where I’ll get comments. This lets me know pretty quickly whether I’m writing well – or I need to work on something.

Alternately, I’ll just take one little piece of a post for The Simple Dollar and polish it, honing a truly great paragraph. This moves me from working on just content creation into working on editing, another piece of the writer’s toolkit.

With my golfing friend, instead of going home each night and lamenting that he doesn’t have the time or cash to go golfing, he should go to a park or a field somewhere where there is a lot of open grass and practice specific shots. Lay a hula hoop on the ground, then back away fifty yards and practice hitting chip shots into that hula hoop for an hour nonstop. Do that every night and your chip shots will get better and better.

The key here is to not “practice” the whole of what you’re doing. The key is to practice specific elements. Focus wholly on the areas where you’re weakest and drill in on them. Do some intense work on just one specific element of what you’re trying to accomplish.

After that, have fun and notice how that practice helped you become more complete in the area you’re passionate about.

Persistence.
Many people know what their passion is and how to practice to get better, but they are content with merely doing so every once in a while. They sit back and get complacent with what they know, only practicing every once in a while for a specific purpose.

For some, that’s enough. My mother-in-law is a very good piano player who can play stunningly well by ear; she also knows quite well how to practice to go from being very good to great. But the persistence isn’t there – she doesn’t sit down at the piano and practice chords over and over again or try banging through highly complex pieces or try mastering some of the more common techniques through repetition.

Persistence is the repetition of practice, and if anything, it’s the most important P. The gap that separates the very good from the great is the repetition of deliberate practice and the ability to keep at it no matter what.

It’s easy to echo countless stories and anecdotes about this. I like the story about Abraham Lincoln – during his adult life he was fired from his job, failed as an independent businessman, had a nervous breakdown, lost elections to the state legislature, state Speaker of the House, the House of Representatives, the Senate, the Senate again, and the Vice Presidency before finally becoming President. There were countless times he should have or could have quit, but he didn’t, and by persisting, he made an indelible mark on history.

I write thirteen articles for The Simple Dollar every single week. I’ve written at least 1,000 words every day for seventeen years. Sometimes, I won’t write anything at all that sets anyone on fire. At other times, I’ll write so much good stuff that it’s running out of my ears. But I don’t give up on those bad weeks – I keep at it because I know that when I stop being persistent about it, that’s when things will start to fall apart.

In Brad’s situation, he needs to stop by the park and practice some aspect of his game every single night. By making it an essential part of his day, something he must do without fail, he will put in the huge number of hours he needs to get better.

You know what your passion is. You know what you need to do to get better. Set aside some time right now to get better, every single day. It’s a tough choice, but it’s the one you need to make to pull your dreams closer one baby step at a time.

Patience.
About once a week, I’ll get an email from a disheartened writer. They read The Simple Dollar, thought that they could do the same, then sat down to crank out their own blog. The desire to write burned inside of them, they knew exactly what needed to be done to develop and produce good articles, and they understood the need to write every single day.

What they found out is that after two or three months, their site still only received a handful of visitors. They’d write to me wondering what was wrong, expressing some serious disillusionment. Usually, it didn’t matter what I wrote back to them – they’d usually abandon blogging, often with the sense that it was a scam or something or that the system was rigged against them.

There is no scam. They lacked patience.

Take Brad’s golfing passion, for example. Let’s imagine Brad gets the memo and starts practicing every day at the park for an hour. He practices his chip shots, his putts, and even his iron play from the rough. He hits the same shots over and over again and begins to get a real feel for his game.

Then he goes out on the course and hits an 88. He’s devastated. That was the same score he shot before he even started practicing! He tosses this stupid practice thing in the dumpster and gives up.

Patience, Brad. Look at Tiger Woods. He’s the best golfer in the world and can hit below 70 with stunning regularity, but even he hits a 74 every once in a while. The last time you shot an 88, it was on a day where you were naturally playing a bit above average. Now, when you shoot an 88, it’s an average day. All of that practice managed to shave a consistent stroke or two off of your score, but you’re judging that progress based on one round – and that’s not nearly enough.

In my own life, I went through periods where I was ready to give up the writing dream. I’d write every day, but I’d feel like I was, if anything, getting worse as a writer. I’d see no success in getting anything published – all I’d see were rejections. It often took everything I had to keep going, but I knew that if I stopped, the dream I had of being a writer would never happen. So I kept plugging away.

A while back, I noted nine techniques for developing patience:

Figure out what your actual destination is.
Make a “Plan B,” too.
Take the other side’s perspective.
Break down big goals into tiny ones.
Wait. Just a little.
Recognize that there are some things that you simply can’t control.
Think about the things that make you react on impulse.
Recognize when you do act on impulse.
Forget the results, enjoy the process.

Whenever you feel like you’re about to give up on your dreams even after investing a lot of passion and effort into them, look at these techniques. After all, all you need is just a little patience.

Participation.
Passion, practice, persistence, and patience will make you very, very good at something, but true greatness requires even more. It requires learning from others and also sharing what you know.

Every truly great person got there by participating in a wider community. They either brought something to the table that hadn’t existed before or helped someone else stand on the shoulders of giants. They changed the game, not just for themselves, but for others as well.

For me, this means interacting with other writers. It means participating in interviews. It means mentoring new bloggers. It means sharing what I know freely and also learning what others can teach me along the way.

For Brad, the possibilities of participation are nearly endless. He can teach others how to play golf. He can participate in community events, like organizing charity tournaments at the local public golf course. He can get kids interested in the game he cares so much about. He can use his passion and practice and persistence and patience as tools to not only make himself better, but bring something of value into the lives of others as well.

Don’t know where to start? You can begin by participating in general community events and meeting as many people as you can. You’d be shocked how many opportunities there are to share your passions with others, and from there the word can only spread outward.

It is only through that kind of participation that doors will open and you’ll be able to truly live your dream. Your passion, your improved skills, and your desire to share what you have with the world will make you stand out, and when things fall into place and the right opportunity comes around, you’ll be ready and waiting.

Starting on a Big Dream Right Now
Those five elements are all you need to start in on your dream right now.

Passion. Find it and know it.
Practice. Break your passion down into pieces and deliberately work on the elements.
Persistence. Practice as much as you can on an extremely regular basis, like clockwork.
Patience. Don’t expect to be great in a day, a month, or even a year.
Participation. Find new ways to get involved and share what you know.

Today, my friend, is a great day to get started.

Many thanks to Images of American Political History for helping me find public domain images for this post. For those curious, Passion was represented by Thomas Paine, Practice was represented by Benjamin Franklin, Persistence was represented by Douglas MacArthur, Patience was represented by Lyndon Johnson and Martin Luther King, Jr., and Participation was represented by Susan B. Anthony and Elizabeth Cady Stanton. The life stories of all of these people taught me valuable lessons about achieving my dreams.

When I got a little older, I had to make some choices. I could be “financially responsible” and start preparing for some big dreams … or I could take the easy path and bust out the credit cards. I looked down both paths… and then I started buying stuff. I filled my home with DVDs and books and electronic equipment and other stuff I didn’t really need – and that I already scarcely remember.

I started feeling the regrets before I was even twenty eight years old. I had a pile of debts that pretty much locked me into my current career path. I had almost no time to become a writer. I had a child, but I wasn’t spending the time with him that I wanted because the need for more money fueled my activities. I obsessed over work (even to the point of interrupting planned family events) and when work was done, I played hard, too.

Soon, I began to realize I was trading my dreams for a pile of stuff. I was swapping all of the things I truly wanted to do for some minor experiences that didn’t really stick with me. I was broke every week, but the reason I was broke wasn’t because I was chasing my dreams – it was because I was buying a mountain of scarcely-played DVDs and video games and spending my spare time dumping my money into sports cards and other ludicrously expensive “hobbies” such as stocking my home with the latest electronic goodies.

I gave these things up. I made some changes in my life. I stopped spending on the silly things and started “spending” on the big dreams. I spent my spare time practicing my writing and spending time with my children, and “spent” my money socking it away in savings so that it could help me during the lean times of chasing my dreams.

When I’m an old man, I won’t regret not buying that flat panel television or that Lexus. What I might regret is the thought that I spent my money on stuff instead of on opportunities – opportunities to follow my creative dreams, opportunities to spend time with my children when they’re young, and opportunities to stop and smell the roses instead of running forever and ever on a treadmill without end.

For me, it was really a simple choice.

No regrets.

What’s your choice?

This is a huge goal, one that I won’t achieve for many years no matter what path I choose. I dream about achieving this goal around the time my final child graduates from high school – roughly twenty five years from now.

What’s the exact goal? The first step in figuring things out is to determine exactly what I’ll need. Do I want to replace my living expenses alone – which would mean that I’d have enough to live, but wouldn’t be very protected against inflation – or if I want to replace my whole salary, giving me a lot of breathing room. The actual number I’ll probably need is somewhere in the middle – enough to maintain some growth, but not my current salary.

Let’s say I shoot for $50,000 a year in today’s dollars – in 25 years. Given 4% inflation between then and now, I’d need an income of $133,291.80 then. If I invest it in a stable fashion, I should be able to rely on returns of 7% annually. meaning I need to shoot for $1.9 million in investments in 25 years.

What tools do I have? I have a number of options at my disposal to reach that goal.

Retirement plans / 401(k)s If I actually retire at that point, I can start taking withdrawals earlier than the normal retirement age – that’s a 72(t) withdrawal. Thus, it makes a lot of sense to dump a big allotment into my retirement plan now. Given that the date I need is 25 years off and I’m targeting a very big number, I need to go pretty aggressive here – for now.

Standalone investment accounts A person can also put their after-tax money into investment vehicles like individual stocks, bonds, and mutual funds. There are many investment books that can help with this. My current plan is to adopt a portfolio from The Lazy Person’s Guide to Investing and add in a small piece for individual stock purchases – I plan on buying into a few individual companies eventually.

Paying off debts early Debt repayment is merely an investment at a known interest rate. For example, if my home mortgage has an interest rate of 6%, an extra payment on that debt is an investment that will return 6% through the end of the original mortgage – it’s interest you won’t have to pay on that money, so it’s investment returns in your pocket. Since this 6% is incredibly stable, it’s often useful to make it part of your investment portfolio. Of course, this does assume that when you’re done with that debt, you take both the original payment and the extra payment and roll it into some form of investment, but I plan on doing that.

This doesn’t mean that it makes sense to take out loans and then pay them off early. You’re better off not taking the loans at all and instead saving up for big purchases like automobiles. However, if you’re starting with pre-existing debts, it’s useful to look at them as opportunities.

Extra work Right now, I make some additional income from blogging, which I’m rolling into this plan. In addition, I’m also writing a book and working on a few other interesting items that can potentially put some money in my pocket over the long haul in a passive income sense. This basically generates more money to invest in this plan, making it easy to meet my investment goals each year and to perhaps exceed them – and do it consistently over time.

What do I need to do? Let’s say that each year I can earn an 8% return (on average) on my investments. I’m intentionally going low here so that I don’t underestimate the personal sacrifices I need to make to get it done. I need $1.9 million in investments in 25 years. What do I need to sock away each year to get to that level? Some simple Excel calculations show that I need to be socking away $26,000 per year to reach that goal.

Now, if I put the maximum allowed limit into my retirement plan ($15,500), I need to be investing $10,500 more on my own each year from here on out. This is a number I can actually reach fairly easily right now, but the real question is where should I be putting it? Right now, I’m paying off all of my debts with an interest level of 6.5% or above – basically, everything but my mortgage. I view that as an incredibly stable investment with a rate of return approaching what I need.

Once those are paid off, I’ll actually have a bit more to invest in a year – about $12,000 after my retirement plan, according to my math, and perhaps even more than that. This money will be used in a diverse portfolio that I’m still working on – one piece of it will be advance payments on my mortgage, which will provide an incredibly stable 5.875% component (there’s no tax implication because my standard deductions for all of my dependents are substantially more than the house interest). The rest will be in a portfolio, as I discussed above.

All of this adds up to one thing: reaching true financial independence is realistic – and it might happen sooner than I think.

In a nutshell, the idea is that you can only achieve audacious accomplishments if you set audacious goals to begin with. What are your biggest goals? What’s the game plan for getting there? If you’ve never thought about where you want to go, how do you know if you’re following the right path to get there?

Several months ago, I made a list of 101 goals that I wanted to reach in the next three years. I piled this list on top of an already long list of medium term and long term goals – building a writing career, paying off every debt, and so on.

While making this giant list of goals felt very empowering at first, it soon became a big weight on my shoulders. I felt like there were too many things that I was reaching for at once. When I make a goal, I’m committed to achieving that goal, and thus I often felt like Lucy and Ethel on the chocolate candy assembly line – more to do than I could possibly keep up with.

As I mentioned yesterday in my review of the excellent book Happier, one big key for making goals more accessible and attainable is to figure out the ones that feel the most vital to you and eliminate the rest. You’re then able to focus a significant amount of your time and energy on each remaining goal, bringing those goals to fruition much sooner.

I sat down with my list of 101 goals and decided to pare it down to five goals. How can I do that, when I find value in all of the goals? Here are a few principles I used.

Ask myself serious questions about every goal. Does this goal really fulfill me? Do I find value in working towards it? Would I feel value in achieving that goal? Compared to other goals, does this one offer significant value in my life? Using these questions, it became clear that, at the very least, there were a lot of those goals that were simply not up to the standards left by others.

Realize that many goals overlap, and seek a goal that, through completion, would take care of other goals automatically. Many of the goals that did remain had significant overlap, so I tried to select one goal – or create a new one – that contained what I was striving for with the other goals. This eliminated many more of the 101 goals on the list.

Evaluate these remaining goals in terms of how much joy and fulfillment they bring to my life. A good goal brings some joy and fulfillment along the road to success and often a giant burst of joy when you reach it. They add genuine value to your life. I attempted to rank all of the goals by the value they would bring to me while doing them and the value they would bring from successful completion. Using this filter, the top five goals became very clear.

Thus, here are my goals for the next three years.

Build up my fitness so that I can do at least rung 30 of the lifetime fitness ladder on a daily basis. Basically, achieving this goal means a thorough daily cardiovascular exercise. I can do this each morning when I first get up, down in the basement while the family is still asleep. This is a combination of several fitness goals on my earlier list.

Eliminate all of our family’s debt besides our mortgage and build up a $50,000 investment portfolio. This means, day in and day out, practicing frugality and putting my own money away. This is also a combination of several goals from the earlier list.

Read a significantly challenging book every week, totaling 156 books. I’m looking primarily at well-written pieces of fiction and nonfiction. I consider collections of essays and short stories (The Best American series) to be appropriate here, as well as Pulitzer Prize winners, National Book Award winners, and critically acclaimed nonfiction books.

Write a daily diary for my son and for my daughter, recounting something I did with them each day. This requires not only writing in the diary, but also doing something valuable and worth noting with them every single day.

Make my writing a full time endeavor. This encompasses a large number of goals from the earlier list, because to do this I need to continually raise the bar of excellence on The Simple Dollar, find some new ways to use my writing to build income, fully develop and create some other blogging ideas, and then make that scary leap, which is itself something of a block.

That’s it. These are my five goals over the next three years. As long as I’m able to keep moving forward on these goals, I will have accomplished virtually everything of value on my list of 101 goals.

This new list doesn’t feel like pressure – it actually feels like a weight off my shoulders. I no longer have to look at that long list of goals and feel as though I’m failing because I’m not accomplishing them. Instead, I can just look at these five and feel empowered. Five goals, all of which provide some pretty obvious “next steps” all the time, fill me with a sense of “let’s get this done!” excitement rather than the sense of “that’s just too much” that the longer list gave me.

However, creating that longer list served an incredibly valuable purpose. It identified for me, pretty clearly, where my chief concerns like: my family, my health, and my creative growth. From that came this more immediate and concise list of goals – but it would have been much harder to find good ones without the brainstorming of the longer original list.

In other words, don’t be afraid to abandon your goals when they begin to overwhelm you. Seek to define goals that are really in accordance with what you find valuable in your own life, keep that number of goals low, and you’ll find yourself with a lot more motivation to succeed without the subtle weight of feeling overwhelmed with too many goals to achieve.

I find it’s always better to actually write down your goals for several reasons. First, it actually helps tease them out of my mind and make them concrete, instead of the nebulous nature that they often take in my head. Second, it gives me a nice checklist to work on throughout the week. Third, at the end of the week, I can look at that list of things that I accomplished and realize that I did indeed get some things done this week.

To give you an idea, I thought I’d share my personal “week ahead” list with you, perhaps to inspire you to make your own.

Clean the laundry room. There’s a big pile of unfolded children’s clothes in there, along with what appears to be some spilled laundry detergent and a couple baskets of miscellaneous things (dish towels and the like) that need to be washed as well. A good half an hour should take care of this issue.

Go through the “unsorted” mail stack and file what needs to be filed. Our mail routine goes something like this: we get the mail out of the mailbox, open everything, toss the junk, determine if the rest is actually important, and if it’s not urgent, we put it in a stack that needs to be sorted and filed. Once a month, I go through this stack and file it, a task I would normally do on the first weekend of the month, but we had a number of houseguests this weekend.

Take a careful look at the dryer and likely call a repairman before the end of the week. The heating element is about shot with our dryer, meaning a normal load of clothes takes about two hours to dry. This means a call to the repairman is likely in the future unless it’s something very simple that I can discern with some inspection.

Reorganize the pantry. Our pantry starts off organized, then slowly descends into chaos over a period of time. It’s pretty chaotic right now, so I need to pull everything out of it, then put everything back. Another part of this is that I’m going to assemble a proper spice rack as well – our current “spice rack” consists of a good-sized cardboard box with a lot of small jars and canisters tossed in it.

Give a detailed reading of the prospectuses for my retirement plan. I’m currently in a Target Retirement fund that isn’t perfectly clear on how it’s managed, so I’m hoping to read through the prospectuses and really understand what it’s made up of. I would actually like it to be more aggressive than it currently is, so if it’s just made up of other funds I have access to, I may split things up.

Polish the first three chapters of my book. I think it’s time to get out the book and start polishing it. I hope to shine up the first three chapters by the end of the week. This means print them off, sit in a quiet room with a red pen, read them, and mark everything that looks wrong. Then, I’ll take this marked-up stuff, return to my computer, and do some heavy document editing based on those notes. If it’s still not right, I’ll put the chapters back away and revise it again in another month or two.

Try making a checklist of goals for this week, and make a concerted effort to get them done. You’ll feel really productive next Sunday when you glance at that list and realize that you’ve accomplished some things this week.

2. Keep that wallet in your pocket. Time is money and money is time – don’t spend either without a good reason.

3. Stop and smell the roses. You’re never too busy to enjoy the simple pleasures that life affords you.

4. Tell someone that they’re doing good work and that you appreciate it. Then tell their boss about it.

5. Do something you’ve never done before. You might have a hidden talent you’ve never known about.

6. Take a step towards one of your goals. You have goals, right? If you don’t know what the next step is, figure it out – that in itself is a big step.

7. Laugh out loud, and make someone else do the same.

8. Put some money away for the future. Anything at all, even if it’s just a dollar. One dollar a day starting at birth in a 4% savings account adds up to $120,000 at age 65. If you put away a bit more than that and just leit it be, you won’t have a thing to worry about when you’re old, just chasing a grandchild across the yard.

9. Tell someone you love them. Your mother, your wife, your child, a person who influenced your life a ton – whoever you love.

10. Do something unexpectedly kind for someone else, just to help them out. If they ask you if you want repaid, tell them to just do a favor for someone else.

If I can do all of these things today, and tomorrow, and the day after that, and the day after that – then I’m in the process of living a truly rich life.