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Posted: February 02, 2012

5.5 reasons people don’t set financial goals

Maybe this applies to you, too

John Kyle

With all of the outstanding benefits that research has proven in regards to goal setting practices over the years, why is it that so many people you know (you too maybe?) still do not set goals for themselves?

Since the turn of the century, stacks of data have been compiled demonstrating just how powerful the art of goal setting truly is. Even so, I still speak with people each week who state that they do not have written goals- much less any financial kind of goals. These same people also declare that they want to be successful in life financially, or achieve peak physical fitness, or improve their focus and concentration on the job, etc.

But the question still remains: why do so many people still choose to live their lives without clarifying their most important financial goals with so many facts and statistics indicating such great payoffs?

The answer to this is not as simple as you may think, as there are certain characteristics, even psychological blocks, that lead people to under achievement, frustration and mediocrity. If you are the type of person who wants to move forward in your financial life then you'll want to read further to see what road blocks may be standing in your way or could at some point in the future. With this knowledge, your chances of reaching new heights financially become much more tangible and reachable.

Here are the 5.5 reasons people don't set financial goals:

1. Fear of criticism- For most people, this fear is developed during early childhood and/or adolescence. Well-meaning parents or teachers may have discouraged you from setting goals by pointing out all of the reasons why it would not work. They of course felt as if they were protecting you from getting your hopes too high and then being disappointed if you didn't succeed.

Also, over the years, perhaps in High School, many people are ridiculed by their peers for wanting to achieve something great. When that happens, you learn to shut-up and keep your dreams to yourself. You learn to play it safe, to go along with the crowd and not to rock the boat. The unfortunate reality of this fear can be that you take it into adulthood where you continue to conform and sell yourself short time and time again, which can lead to low self esteem, low self confidence and lack of any real motivation and financial gain.

If you can learn to let go of what others think of you, you'll find that setting and achieving your most important financial goals will come to pass much faster and more easily than you can possibly believe.

2. Fear of accepting responsibility- As Emerson once said, "No one can cheat you out of ultimate success in life but you." It is always easier to blame your environment, your family, your genetics, the economy, the government, your neighbors, or your boss (etc., etc.), then to look at yourself in the mirror and see the real problem. Most people are lazy and find comfort in explaining away their financial failures or lack of effort to properly invest. They reason that if it's not their fault then they won't look bad or have to work as hard or no one will blame them. Yet once you accept responsibility for the condition of your finances, you'll see that instantaneously, setting goals becomes a simple task.

3. Fear of success- This is an odd fear, yet it is a very real one and tends to hold many people back in life. Most of these people were raised with the belief that making money and being "a success" is a bad thing that they will somehow become like Scrooge in the old Charles Dickens's Christmas fable. These people who fear success will strive hard to fit-in and will even apologize to others for their accomplishments. In other words they fear standing out or being different than their friends even if means sacrificing their success. It will do wonders to your retirement account to evaluate your beliefs about money, success, appearance, etc. and change your perception about what these things mean to you in order to fear less and achieve more.

4. Fear of failure- Everyone you know has this fear! Many of the top achievers you know have this fear in buckets! Which is usually why they have become successful in the first place. (A good use of fear.) However, many more people will allow this fear to control them to the point of preventing themselves from even setting a goal in the first place. Their mentality is "if I don't try, I will never have to face failure and all of the pain and embarrassment that comes with it." Instead, if you can live by the statement "nothing beats a failure but a try", you'll prevent this fear from ever manifesting financially and you'll see that fear of failure slip away as more and more of your goals are accomplished.

5. Never learned how-I don't know about you, but there was never a Goal Setting 101 class in High School or College, nor did my folks, coaches or instructors take me aside and teach me at any age. And I suspect the same is true for you. Setting, managing and achieving personal goals is a skill set that makes all of the difference in reaching your personal level success. Back in the 1970's a 20-year study began at Harvard University in regards to goals (From the book What They Don't Teach You at Harvard Business School by Mark McCormack). The students were asked if they had any goals after they graduated and it was discovered that only 3 percent of the class had clear written goals. Within 20 years, that same 3 percent had accumulated more wealth than the other 97 percent put together. Learn how to set goals.

5.5 Hanging Around the Wrong Crowd- Think that the people in your life don't make an impact on you? Think again. I've dumped people out of my life because they were too negative or didn't believe in me. I have one life and no time for nay-sayers. You'll find that when you're making a real effort to reach your goals in life, there will be people who will be like crabs in a pot of boiling water: when one is trying to escape, the others will pull them back in! When you begin to tell friends what your financial goals and dreams are, you'll find out quickly who you can go to for support and who you'll want to avoid. The more time you spend with people who will support you in your efforts (even it's just emotional support by telling you to stick with it), who will push you forward in life, the more obvious it becomes that you've found true friends. To find the right crowd to hang around, simply ask yourself if the people you hang around are an anchor (hold you down) or a motor (push you forward) and then spend more time with the motors.

Having difficulty breaking one of these "blocks" to financial success? Shoot me an email and we'll see if we can't overcome it together! John.J.kyle@mssb.com
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John Kyle is a Financial Advisor with the Global Wealth Management Division of Morgan Stanley Smith Barney in Denver, CO. He can be contacted via e-mail or his web site http://fa.morganstanleyindividual.com/johnkyle/ . The information contained in this article is not a solicitation to purchase or sell investments. Any information presented is general in nature and not intended to provide individually tailored investment advice. The strategies and/or investments referenced may not be suitable for all investors as the appropriateness of a particular investment or strategy will depend on an investor's individual circumstances and objectives. Investing involves risks and there is always the potential of losing money when you invest. The views expressed herein are those of the author and may not necessarily reflect the views of Morgan Stanley Smith Barney LLC, Member SIPC, or its affiliates.

 

Since 1994, John Kyle has been a successful small business owner, an account executive with a national insurance company, and a sought-after business consultant for other small business owners. John is also a financial advisor with Morgan Stanley Smith Barney in Denver and specializes in creating safety nets for his client’s investment portfolios. Contact John at john.j.kyle@mssb.com or 303-595-2021.
 

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Readers Respond

Nicely written John! I'm proud of you man! By Robert on 2012 02 03

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