Master Your Money: The Ultimate Guide to Setting and Achieving Your Financial Goals

Embarking on a journey towards financial success requires more than just wishful thinking – it demands a clear roadmap paved with well-defined goals.

In the following article, we'll explore five invaluable tips that will help you create a fundamental mindset shift towards setting and more importantly, achieving your financial goals. 

So, let's dive in and uncover these five tips.

Tip 1: Recognise the true purpose of Goal Setting

Many people may not realise this - the hidden purpose behind setting goals.

The truth is that, the real value of setting a goal is not in the achievement. Instead, the primary reason for setting a goal is to compel us to become the person it takes to achieve them.

Let me explain.

What do you think is the greatest value in becoming a millionaire? It is really the million dollar in the bank? I don't think so.

The greatest value is in the skills, knowledge, discipline and leadership qualities you will develop in reaching that elevated status. It is the countless failures in the journey to becoming a millionaire that mold the individual into a resilient, unbreakable character.

Give a million dollars to someone who do not possess the attitude of a millionaire and that person will most likely lose it. Think about all the lottery winners, whom have a sudden influx of wealth.

But try taking all the wealth from a true trained millionaire  and in no time, he will build a new fortune.

You may wonder why.

Well, this is because those who earn their millionaire status develop the skills, knowledge and experience to duplicate the process again and again.

In short, when someone becomes a millionaire - the lest important thing is what they have. The most important thing is what they have become - this is what I call an identity shift.

And once you have shifted your identity to a more powerful character - you become unstoppable.

Tip 2: Change Your Identity

Change your identity - the strongest force to force behavior change.

This is something I learnt from James Clear, in his book Atomic Habits.

To achieve your goals, we must first change our habits.

However, changing our habits is challenging as we try to change the wrong thing. To understand what this means, you need to consider that there are three levels at which changes can occur.

The outer layer represents your outcomes. Most of the goals we set are associated with this layer - for example, losing weight, making more money, getting a promotion, etc.

The middle layer represents changing your processes. This concerns with changing your habits and routines.

The inner most layer represents changing your identity. This level is concerned with changing your beliefs.

In summary, outcomes are what we get. Process is what we do. Identity is what we believe.

Most people make the fundamental mistake of changing their habits by focusing on what they want to achieve (i.e. the most outer layer).

However, there is a better alternative.

That is, to focus on the inner most layer. Focus on who we wish to become.

Now imagine two person resisting a cigarette. When offered a cigarette:

1. The first person says, "No thanks. I am trying to quit". 

2. The second person says, "No thanks. I am not a smoker"

You can see that the first person still has the inherent belief that he is a smoker. Whereas, the second person had a fundamental shift in identity and that he is no longer a smoker.

The ultimate form of intrinsic motivation is when a habit becomes part of your identity. It’s one thing to say I’m the type of person who wants this. It’s something very different to say I’m the type of person who is this.

So if you want to achieve your financial goals - start believing and say that you are an investor. Or a trader - whoever you might be. You will then realise your actions will change drastically.

Tip 3: Set Process Goals.

Once you have set for a fundamental identity shift. The next step is to set process goals.

One of the mistakes, when people set goals - is that they are so obsessed with the outcome, they forgot to properly define the process required to achieve the outcome.

For example, if we are trying to lose weight - a weak goal would be to lose 5 kg.

Here's a much more powerful goal.

• "My goal is to become a fitness enthusiast (i.e. identity shift) and to exercise 5 times every week for 30 minutes each time (i.e. process goal). As a result, achieving 5kg weight loss is inevitable"

The outcome of achieving a 5kg weight loss would come inevitably, if we have shifted our identity and our process.

The same goes for our financial goals.

We should not be setting weak goals like - "To reach $100K in my portfolio or achieving $3,000 in cash flow monthly".

Instead, our goals should be something like this:

• "My goal is to become a disciplined investor (i.e. identity shift), who only invest in stocks that are undervalued while maintaining proper portfolio sizing (i.e. process goal). As a result, achieving a $100K in portfolio value is inevitable  (i.e. outcome)"
  
• "My goal is to become a disciplined options seller, who only enter into option positions following strict entry rules and mercilessly cut losses when required (i.e. process goal). As a result, achieving $3,000 cash flow monthly is inevitable  (i.e. outcome)"

Tip 4: Success Leave Clues.

We also need to set the right process goals.

Our process goals have to make sense. Imagine if our process goals were like this:

• "My goal is to become a fitness enthusiast (i.e. identity shift) and to exercise once every week for 15 minutes (i.e. process goal). As a result, achieving 5kg weight loss is inevitable"

Clearly, there is a fundamental desync between the process goal and the outcome. Because, there is no way that exercising just 15 minutes a week would be sufficient.

So how do we determine the right process to follow?

Well - success leave clues. Model after those who are already successful.

This was the same approach that I did many years back in 2017 when I just started in the world of options. I modeled after people who were successful in their craft.

People who do well own the habits of success. They create patterns of winning behavior just as the straggler creates patterns of losing behavior.

Tip 5: Crystalise the Process

"If it is not on the calendar, it is a dead dream."

Once you have figure out the process that you want to follow to be reinforce the identity that you want to become - the next logical step, is to crystallize those process within your calendar.

Have clearly in mind, what you will be doing in each and every day.

Success can sometimes be a boring activity.

For example, working out every day can be mundane (especially a long day at work). But the fruits of your labor is what makes it worth it.

So, as boring as it may be - schedule it within your calendar and execute the work.

This is the same reason why I schedule on my calendar everyday to look through trading or investment opportunitities.

Similarly, for my health - I schedule time to do my 30 to 45 minutes of work out sessions.

You need to harness the power of your calendar, and block out time to execute these processes that (i) build your desired identity and (ii) achieve the outcome that you desire.