The Grind

“Most people overestimate what they can do in one year and underestimate what they can do in ten years.” —Bill Gates

One of the biggest changes in my perspective on personal finance since I started The Simple Dollar is how to succeed at your goals.

When I first started to turn things around, I set what I thought was an enormous, audacious goal. I wanted to pay off all of our debts, which were in the mid five figures at the time, in a year. It seemed practically impossible. It was this big intimidating goal. I decided to throw everything I had at it.

For a while, I spent a ton of time and focus every single day figuring out how I could squeak out a few more dollars to throw at that debt. I had a nice vintage Magic: the Gathering card and sports card collection from my teen years and I sold off many of the valuable cards one at a time to maximize my return. Sarah and I started preparing all of our meals at home and I started taking leftovers to work every single day. I sold off almost all of my video games, the majority of my books, and most of my DVD collection, mostly piece by piece to maximize return. I did thing after thing, trick after trick, step after step to cut my spending as much as possible.

When my enthusiasm for all of that started to wane a little, I started The Simple Dollar so I could channel my passion for writing into it. I’d write about my experiences with every little savings tactic I could find. At the same time, I had some moderate success repairing computers for a number of elderly people who mostly used them to email relatives (this was basically before social networking became a big thing) and mostly just enjoyed having someone to talk to. They’d call me to come fix some minor problem and I’d end up having coffee with them and listen to stories about their grandchildren and then pay me some negligible amount for the effort.

What happened? In less than a year, all of that debt was gone. I had thrown everything but the kitchen sink at all of that debt, and it had vanished.

There is a giant problem with this success story. It only really worked because I was able to sustain a ridiculous amount of effort over the course of an entire year. We got there, but it was only due to a day-in-day-out obsession with saving every penny and earning every extra penny that we could.

Yet, in the back of my head, it set this false idea that the best way to reach a big goal is to set a big goal and throw everything but the kitchen sink at it.

Over the following years, I used this approach with all kinds of goals and… it mostly failed. I’ve tried it with weight loss. Failed. I tried it with various fitness goals. Failed. I tried it with building The Simple Dollar, and there it somewhat succeeded, but even that was an illusion (I’ll get back to that).

So, what’s the story here? I now think that my ability to achieve that huge goal in a year was an aberration that only worked because there was a perfect storm of elements. My infant son and my growing understanding of what it meant to be a father was a huge emotional driver, as was the realization that a second child was coming near the very end of that year. I was able to utilize my passion for writing to help continue and maintain my efforts by writing for The Simple Dollar, and that “juice” was only there because writing wasn’t actually my main career. I had a lot of spending that I could cut from my life and a lot of items with at least some value in the closet that I could sell off. The progress was easy to see and easy to track and additional effort translated pretty nicely into additional observable progress.

The thing is, for most goals, you’re not going to have all of those perks. You aren’t going to have steady observable progress toward your goal – even with perfect effort, you’re often going to progress in fits and starts. You won’t always have great motivation. You won’t always have a ton of low-hanging fruit that makes progress relatively easy. You won’t always have outlets that tap into your other interests.

Several years ago, Sarah and I decided that we were going to aim for early retirement, and I knew right then and there that the strategies that helped us pay off our debt so quickly probably weren’t going to get us to financial independence any time soon – and I was right.

For this goal, many of the advantages we had during our initial push to debt freedom were missing. We can’t make steady progress because of the vagaries of the stock market – a month of busting our rear end could see a drop in our retirement savings, especially as our balance grows. We no longer have a lot of low hanging fruit in our life that can bolster our savings rate or free up some cash for our goal. The honeymoon period of financial improvement is over – we don’t have that same burning motivation we had at the start of our debt repayment. Not only that, there’s no measure by which financial independence isn’t many years in the future. It is a really long-term goal.

If we focused entirely on our big destination goal, we’re doomed to fail. If we use the strategies we used during our debt repayment, we’re doomed to fail.

We need a different approach, and for us, the best approach to an enormous goal that’s more than a few months into the future is to grind it out.

What do I mean by “grind it out”? I mean that the focus of our efforts needs to be on the very short term, where we create routines and habits that produce slow and steady progress toward the big goal, and our success is measured by those efforts alone.

Do I have a good grip on my spending habits today? Am I doing what I can to keep expenses low today? Am I ensuring that we don’t raise the expense of our tastes too high and keeping treats rare enough that they’re genuinely appreciated? Are we steadily contributing to our investments this month?

In other words, if your big goal is a long-term goal, focusing just on the end result probably won’t get you there. Your “honeymoon period” will end and you’ll find yourself falling back into old, bad habits. This is why very few people succeed at long-term diets – they’re so focused on the end goal that they’re not actually focused on sustainable day-in-day-out meaningful change in their lives and thus, when the excitement wears thin and the siren’s call of old habits is loud, they fall back on those old habits.

Instead, if you have a big long-term goal, you need to focus on how you can mold your everyday life to make that big goal a likely outcome of your normal everyday routines. As I discussed in this week’s mailbag, this is akin to Scott Adams’ concept of a “system” (where you’re consistently doing a certain improved behavior or set of behaviors to increase positive outcomes) but the big difference here is that you do still have a long-term goal. You’re choosing the daily behaviors to push yourself toward your big goal.

If you have a huge goal in front of you that’s more than a month or two in the future, I strongly encourage you to focus on daily routines above all else. What can you do today to nudge yourself closer to that goal? Even more important, what can you do today that’s repeatable tomorrow and the day after that and the day after that to nudge yourself closer to that goal? Which of your normal behaviors, if you were to change it in some fashion, would help lead to the big goal you desire? How can you change that behavior? How can you sustain that change?

My own experience has been that it’s good to really focus on changing one or two behaviors at a time unless a serious life change is going on which is already forcing you to make a whole bunch of changes. I tend to do this by executing 30-day challenges where I really focus hard on that behavioral change as a short-term goal, and if I like the results from it, I move on to applying techniques from Triggers to transform it into a permanent change in my behavior.

Just remember, when you’re trying to achieve a monumental goal, it’s not the big steps that matter. It’s the daily grind, and figuring out how to make that grind tolerable and even rewarding and enjoyable is the key to achieving almost every big goal in life, whether it’s debt repayment or financial independence or something else entirely.

Good luck!

Read more by Trent Hamm:

Trent Hamm

Founder & Columnist

Trent Hamm founded The Simple Dollar in 2006 and still writes a daily column on personal finance. He’s the author of three books published by Simon & Schuster and Financial Times Press, has contributed to Business Insider, US News & World Report, Yahoo Finance, and Lifehacker, and his financial advice has been featured in The New York Times, TIME, Forbes, The Guardian, and elsewhere.