What's your financial target?(Read article summary)
Many people live their lives aiming for a day in the far-off future when they feel settled in their finances, Hamm writes. What's your financial target, and how do you plan to get there?
Mark Gormus/Richmond Times-Dispatch/AP/File
“You know, almost every day I spend a day just ‘living for the day,’ I go to bed feeling like I wasted that day.”
I told my wife this the other night as we were getting into bed. We usually have our best conversations during those ten minutes after we both get into bed but before one of us gets tired enough that the conversation stops and the sleep begins.
Anyway, we chatted for a few minutes about this idea and about some other things, and then as she drifted off to sleep, the idea kept running in my head.
I live most of my life – and find a lot of joy in my life – living for a far-off future day.
It shows up in how I spend my money. I don’t buy too much – in fact, we could basically live on Sarah’s income alone, and we did so in 2012 according to my math. That means every post-tax and post-professional expense dollar I brought in thanks to writing, book royalties, and so on went into savings. 2013 is going to be very close to that, even with the tenth anniversary trip Sarah and I took to Boston.
It shows up in how I parent. While I certainly do a lot of fun things with my children, my focus isn’t on being their pal. My focus is on being their parent. Much of the time I spend with them is spent, on some level, molding them into better people.
It shows up in how I work. Although I spent a lot of my time writing articles to cover the next several days, I spent a lot of my thinking time trying to plot out the larger professional goals that I have and I try to use as much time as possible for those long-term goals.
As I laid there in bed that night, I realized that most of my day-to-day life choices are about creating the best possible life for myself at a point that’s about fifteen years in the future.
At that point, all three of my children will likely be in college. I hope to be financially independent at that point, with the definition of financial independence matching what I’ve always talked about on here – the ability to live a full life off of investment returns. I hope to still have an incredibly enriching and healthy marriage. I also hope to be living in our dream home in the country.
That’s my “target day.” To me, a truly good day is one where I enjoyed myself today, but I also planted a lot of seeds that will come to fruition far down the road. Quite often, planting those seeds brings me deep joy, even if the actual activity isn’t fun.
I think everyone has a different “target day.” After talking to Sarah about it, I think her “target day” is even further down the road, because she mentioned grandchildren and a lot of travel in a mobile home.
My parents have a “target day” that’s not very far in the future, on the other hand. They come pretty close to living for the day, which is fine because they already have financial independence thanks to Social Security, a pension, and frugal living.
Why is this important? Once you know your “target day” – the day you’re really living for – it casts all of your actions today into a different light.
Are you living for a day eight years from now where you can afford to launch that comic book shop you’ve always dreamed of owning? Look at today’s work as what you need to do to earn some money toward that. Look at today’s spending as a choice – are you funding a quick pleasure today or are you funding that dream? Look at today’s time use in that light, too.
You’ll find that when you really figure out your “target day,” all of the tough choices of today that can potentially benefit your “target day” become a lot easier to make. Not only that, they feel good. Frugality doesn’t feel like “going without” if you know that your frugal choice is helping make that “target day” great.
What’s your “target day”? What are you doing today to make that “target day” great? Even more important, how does it feel when you reach the end of a day where you’ve made a lot of choices to make that “target day” great?
For me, a day like that feels great.