Happy New Year

New Year celebrationI may not be one for New Year resolutions, but I am one for goal setting. What is the difference? Well, one big difference is that a properly considered goal, that you are truly committed to, is not created at one minute past midnight!

The art of goal setting is a process I will delve into in more detail in a future post. For now, when you are creating your goals, try giving them a name that is meaningful to you, set a date that is very specific (in other words get down to a day, a month and a year), have a target that is measurable and finally, envisage what it will feel like when you achieve that goal. Capture those feelings by putting them into words.

It is this last step that creates an emotional connection with the outcome of your goal. It can become the motivation and inspiration you need, to do the work that is required to achieve your goal.

It is an absolute must that you write your goals down. It is also a must that you share your goals with the people that are close to you. Chances are, it will be these same people that you need help and support from, in order to achieve the goals you set.

The New Year is a great time to be refreshing our existing goals and to be setting new ones. My advice is simply to do it away from the hype of New Year celebrations. Give it real thought. Make sure that your goals are in alignment with your end destination. Finally, once you have written them down, really do commit to them.

Happy New Year! I wish you every success in the year ahead.

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Know your spending

Expense ReportSo you have committed to maintaining positive cash flow. That is an important first step, but the real test is whether you can honour that commitment. So how will you do it?

The first step is to know what you are spending. I am sorry, but ignorance is NOT bliss. You may not like what you see, but you do need to know.

To know your spending means to know how much money is flowing out of all your personal bank accounts, credit cards and debt facilities to pay for your day to day living needs. It is a single dollar figure which you spend in a year. It will include your cash withdrawals, groceries, clothing, motor vehicles, entertainment, telephone expenses, utilities, gifts, and education costs. It does not include the interest on your debts nor one off goals that you accomplish such as a big overseas trip, major home renovation, purchase of a new car or a large cash gift to family or charity.

The best way to know your spending is to add up all the outflows from all your accounts in a single year and then simply exclude the one-offs mentioned above. The good news is that these days there are many different ways to do this depending on what suits your style. As an example, here are four methods that may do the trick:

1. One bank account that handles all payments

One way to know your spending is to keep your banking simple. If you have one bank account, out of which you pay for all of your expenses, then it is simply a matter of adding all of the outflows (debits) from that single bank account.

2. An exercise book

If you are old school, buy an expenses book or exercise book from your newsagent or stationery supplies store. Keep this book somewhere central at home. At the end of each day record the transactions you made. It may help to keep the receipts in your wallet or purse and record them in the book at the end of each day. Calculate your spending totals at the end of each day, then again at the end of each month and finally, at the end of the year.

3. ANZ Money Manager

There is a growing number of online solutions. ANZ Money Manager is a free service which allows you to link your existing bank accounts and credit cards. It then connects with your internet banking and downloads all of your transactions. It automatically categorises the transactions into expense accounts and gives you access to expense and cash flow reports. The automation is not perfect but for a free and low maintenance solution it is very good. If you are prepared to commit 15 minutes a week to maintaining your ANZ Money Manager account, you can achieve more accuracy and turn it into a powerful personal budgeting solution.

4. There is an app for that 

There is a proliferation of apps to help you know your spending and there are simply too many for me to mention here. If you think an app might be the way to go for you, log in to your app store and give them a go.

 

Whether it is one of the above methods, or you devise your own, it doesn’t matter. What is important is that you track your spending with a reasonable level of accuracy. Back of the envelope won’t do, because it will not give you the confidence that you need to make important decisions about your financial future. Make no mistake, knowing your spending is crucial to having confidence in your financial future, and having confidence about your future, will positively impact the quality of life you lead today.

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Design a future that inspires you

The process of strategic planning starts by creating a vision of the future. In the case of personal strategic planning, that means a vision for the life you want to live in the future.

Let’s say you began visualising your future life right now. How would you go about it? Would you take a look at where you are today and try to imagine something that is a little better? If so, then I believe you are going about it the wrong way.

I believe the process for creating a vision for your life should begin with a blank canvas. Then, start imagining the best possible life that you could lead…..your ideal life. Imagine what your life would look like if you were truly happy. Imagine what it would look like if you were the healthiest you have ever been. Imagine what your life would look like if your financial position was thriving. Imagine how would you feel.

As this picture starts to take shape, think about the people you will be spending time with and the activities you will be doing. What will you do for fun? How much time will you be spending in your business or career, compared to the other things in life that are important to you? Where will you be living? What kind of car will you be driving? Where in the world will you travel to?

Take some time to think about these questions and more. Collect your thoughts by writing them down in one central place.

I have found over the years that once you begin this process of thinking about your ideal life, your vision will begin to take shape over time. So it is best to keep your thoughts documented in a single, easily accessible place. In this day and age that may mean an electronic document in the cloud. Be prepared for thoughts about your ideal life to come to you at random times and in all places. Capture these thoughts when they occur and continue to build more clarity and depth to your vision.

I would encourage you to spare some time to regularly reflect on your vision and pay attention to the feeling that it creates inside you. Do you feel excited, motivated or even inspired?

This vision that you create for yourself should be extraordinary. Don’t settle for something that is just a little better than where you are today. Your vision  for your life needs to be inspiring, because you will need to draw on this motivation to drive you to take the action that is necessary, in order to turn your vision into your future reality.

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The fundamental financial discipline

Key and old woodBeing successful in any arena requires discipline. The most fundamental discipline that is required to be financially successful is to maintain positive cash flow.

Positive cash flow is a simple concept. You will hear it communicated in different ways time and time again.  Here are a few of the more common ways it is articulated:

  • spend less than you earn
  • a part of all you earn is yours to keep
  • saving is income not spent
  • pay yourself first
  • the total of your taxes and expenses must be less than your total income

In other words, the cash that flows out of your bank accounts for bills and expenses, must be less than the cash that flows in from your work, investments or pensions. The difference is the amount that becomes available to save, repay debt and invest.

It may be a simple concept but it is a discipline that is hard to forge. As human beings we are often tempted to “have it now”. When we choose to buy something now and spend more money than we have earned, we take away from our savings or our investments or we go into debt. We are making a choice that takes us a step backwards financially.

Positive cash flow is a simple concept that comes with a simple truth – if you are not committed to maintaining a positive cash flow, then you will never experience true prosperity.

So now is a good time for you to decide whether you are prepared to commit to this discipline.  If you are not, rather than save your money, save yourself some time and disengage from this blog. Without a commitment to this fundamental discipline, my blog won’t help you. Feel free to come back when you are ready. For the rest of us, let’s commit to this fundamental financial discipline and remain on the path to prosperity.

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Success Factors

I have created this blog to share my expertise in Strategic Planning, Personal Finance and Structured Giving so that you may benefit from applying it in your own life. I would love to see more people living their life with purpose and making progress towards a life full of health, happiness and prosperity.

Unfortunately, simply reading this blog is not going to make the difference. The knowledge and experience that I share here will count for very little unless you actually take action and implement it in your life. The famous management guru, Peter Drucker, perhaps said it best when he stated “Plans are only good intentions unless they immediately degenerate into hard work”.

The journey to prosperity is not an easy one. That is why most people don’t make it. Over the years I have found that there are some skills and habits that are critical to you being able to successfully implement the ideas I introduce here. For that reason, I will occasionally discuss these critical success factors and I will endeavour to link you with people who are experts in that given area.

This may not make the path toward prosperity any easier, but I hope that by highlighting these critical success factors, it will give you more tools to help you overcome the inevitable obstacles along the way.

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Structured Giving

Thank youI believe that generosity is necessary to achieving a state of wellbeing. Put simply, true happiness comes from what you do for others.

We are all at different stages in our life journey and it is not always possible to be generous by giving substantial amounts of money. Instead we may choose to be generous with our time.

I have been fortunate enough to work with financially successful people for more than 15 years. These are people who have reached a stage in life where they can afford to be generous with their money. For those who express a desire to be philanthropic, I help them develop structured giving plans.

Structured giving introduces a level of professionalism to the giving process.  It generally involves:

  • larger amounts of money;
  • development of an overall giving philosophy;
  • planned grants to charities rather than spontaneous grants;
  • an entity;
  • a board overseeing the entity;
  • independent professionals advising the board;
  • a long-term time horizon;
  • research and due diligence of charities before approving grants;
  • measuring the success of grants by assessing the social impact against expected outcomes;
  • being more engaged.

In this blog I will delve into the professional aspects of structured giving.  It does not matter what stage in life you are at, giving your time and/or money can make a real difference. Introducing some professionalism into your giving  will lead to even better outcomes.

The best part of all, is that contributing to the lives of others in this way,  can have a positive impact on your own happiness and wellbeing. As they say, what goes around comes around.

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Personal Finance

Have you ever wished someone a prosperous new year? Perhaps you have received such a wish. Have you ever thought deeply about what that means? Better still, have you ever seriously imagined what a prosperous year might look like for you?

To be prosperous means to be in a successful, flourishing or thriving financial state. Imagine what your life might look like if your personal finances were flourishing.

Unfortunately, most people never achieve prosperity. Even among those who enjoy significant financial success, many do not describe their financial position as flourishing or thriving. Instead, they still have reasons to worry about their money.

The good news is that true prosperity is a state that we can  all achieve. It starts by creating a vision for your life that incorporates financial success. Then, by making good decisions about your money and aligning the actions you take today with that vision, you will begin making progress towards it.

The principles of making good decisions about money have been known for ages. It is not the knowledge of what to do that is hard to come by. It is the practical implementation of that knowledge day after day, that obstructs most people from financial success.

In this blog I will reintroduce the age old lessons of personal finance, but I will present them together with tips for implementing these lessons in the 21st century. I hope that my modern interpretations put you on the path to experiencing prosperity, a state which will afford you the opportunity to live the life that you want.

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Personal Strategic Planning

The late Jim Rohn, a leading expert on personal success, famously said “Happiness is not an accident. Nor is it something you wish for. Happiness is something you design.”

I would elaborate on that by saying that most things in life that really matter to us, do not happen by accident. For example, good physical health only happens when you exercise. Good relationships only exist when you spend quality time with people. Wealth is only achieved when you save and invest your money.  For any of these things to occur consistently, you need to plan to do them. The more strategic you are about this planning, the better.

It interests me how strategic planning is a well accepted practice in the organisational environment. There seems little doubt that strategic planning is important to achieving organisational success. Why is it then that such an important and effective process is not applied more consistently to achieving personal success?

The concept of strategic planning is simple – start with the end in mind. That means creating a clear vision of where you want to be in the future. Then align the actions you take today with that end vision. The action you take will help you make progress toward your vision.

I am fortunate to have had the opportunity to develop expertise in both organisational and personal strategic planning. In this blog, I will focus exclusively on personal strategic planning. I look forward to sharing what I have learnt with you and I hope that it empowers you to design a future you love.

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Let’s get started

Happy CoupleI believe that everyone in life can achieve a state of wellbeing. That is, a state characterised by health, happiness and prosperity. The reason that most people don’t achieve this, is because it doesn’t happen by accident. It requires a plan, expert advice and discipline.

My mission is to empower people to live their life on purpose. I draw on my skills and experience in the areas of strategic planning, personal finance and structured giving, to guide people in the right direction.

My commitment  can be demonstrated by the lengths that we have gone to at Goodman private wealth advisers, in order to introduce this mission into our business.

This blog will support my mission by bringing together my most important and most topical thoughts for helping you make progress toward your state of wellbeing. I will share my expertise on strategic planning so that you can move forward with purpose. I will focus on the prosperity aspect of wellbeing, because that is what I do best. I will introduce you to the concept of structured giving, because with prosperity comes the opportunity to give back. I will touch on some critical success factors which are necessary for you to keep making progress.

Since my skills and experience are in the aspect of prosperity, I encourage you to seek out other experts who can guide you in the aspects of health and happiness.

I hope this blog makes a difference for you.

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