Leveraging Your Financial Intelligence Read online

  So Joanie and I began to research other options and thought it would be fun to celebrate our September wedding anniversary in Europe, ideally in some areas that were more affordable than France. The delay would give us more time to save money, and would be cheaper overall, because of the time of year and our decision to visit less expensive places.

  We decided that we would visit Amsterdam, Cologne, Hamburg, and Berlin, where my friend was still working. Unfortunately, European soccer was on an off-season break during our trip, so seeing an international soccer tournament is still a dream. I was disappointed, but our goal adjustment process was worth it, because Joanie and I were able to take a great trip together and we got to spend time with my friend.

  Though Ryan and Joanie ran into some turbulence on their way to Europe, their travel goal clearly passed the acid test: They were willing and able to do what it took to make their trip a reality.

  Goals Need to Be Connected to Values and Purpose

  Achieving goals works best when goals are clearly connected to one's principles, values, and purpose. For example, in Donna Krone's case, as she found herself wanting to integrate coaching into her financial planning practice, she set a goal of enrolling in a coaching certification program. To have a happy life, it's helpful to ensure that the majority of your goals align with your principles, values, and purpose. This doesn't mean you can't set goals that may seem to be “selfish.” In fact, goal achievement is a rightfully selfish process, provided the goals are aligned with universal principles (integrity, responsibility, compassion, forgiveness) and personal values (for example, family, happiness, wisdom, service, and health.) Co-author Roy Geer had always believed that “having fun” is a legitimate value, and that as humans we're meant to have fun in the process of living in alignment.

  Best Practices for Developing and Achieving Goals

  You may have heard of a goal achievement study supposedly conducted at either Harvard University or Yale University. According to reports about the study, college graduates who wrote down their career goals were found years later to have been much more likely to have reached their goals than graduates who didn't write down their goals. The catch is that this study doesn't exist. When Gail Matthews, a psychologist at Dominican University, discovered that the written goals study was an urban legend, she decided to conduct her own research on the subject.13 Participants in Matthews' study were randomly assigned to groups which were asked to engage in different tasks related to goal achievement. Matthews' research validated the importance of written goals. But the study also found that additional factors influence successful goal achievement. Matthews' research revealed the following:

  Only 43 percent of participants who were asked just to think about goals they hoped to accomplish either achieved their goals or were halfway there.

  Participants who wrote down their goals achieved significantly more goals than those who did not.

  62 percent of participants who wrote down their goals and action commitments and shared their goal commitments with a friend either accomplished their goals or were at least halfway there.

  The participants who were most successful were those who wrote down their goals and action commitments and sent weekly progress reports to a friend, with 76 percent either accomplishing their goals or being at least halfway there.

  This study shows not just the power of written goals, but also demonstrates the even greater cumulative effect of writing down goals, committing publicly to specific actions, and being accountable to someone supportive as you work toward achieving your goals.

  The authors' work with thousands of clients confirms the Matthews' study results. Documenting goals in writing and enlisting support from others, for instance a coach, partner, or spouse, greatly increases the likelihood that you will reach your goals.

  STEP 2: HAVE A PLAN

  So far we've been talking mostly about the process of setting a goal. The second step in the WDYWFY model is to have a plan for reaching your goal. Analyze your goal and determine everything you need to do to accomplish your goal. Ideally you will already have identified key activities in order to apply the acid test. As part of developing a goal achievement plan, take another look at your key activities list to be sure you have included all “must dos” for reaching your goal. Key activities answer as many of the following questions as possible:

  What is the action?

  When will I do it?

  How long will I do it?

  How frequently will I do it (if more than once)?

  With whom will I do it (if someone other than just myself)?

  Here is an example of key activities that were part of Ryan and Joanie Goulart's plan for their September 2016 European trip:

  Joanie must make plane reservations by April 15.

  Ryan must put together an itinerary and schedule for the trip by May 30.

  Joanie must book lodgings for all destinations by June 30.

  Together we must save enough money each month through August 30 to fund our total travel budget.

  Use the Goal Achievement Plan worksheet for recording key activities needed to accomplish your goal. You can find a blank copy in Appendix E. You can also download copies from the book Toolkit at www.leveragingfi.com.

  EXAMPLE: GOAL ACHIEVEMENT PLAN

  My Goal: Attain a healthy weight, meaning I must lose 20 pounds within 6 months.

  Key Activities “I Must Do”: Eat healthy meals; do not skip breakfast.

  Limit alcohol to one glass of wine with dinner, weekends only.

  Fast-walk 30 minutes five days a week, Mon–Fri; “10,000 steps” 7X/week.

  Sleep at least 7.5 hours a night. Go to bed by 10 PM.

  Resources I Need to Perform My Key Activities: Produce, eggs, and grass-fed meats from local farms

  Money for increase in cost of higher quality foods

  Fitbit fitness tracker to motivate and maintain accountability

  Money for health coach

  People I Need to Support Me and How Name Support I'll request

  Julio, my health coach Help with eating plan; ideas about exercise; encouragement

  John, my husband Understand why I need to go to bed earlier; don't bring junk food into the house; help with extra money for healthier food

  How I'll Track Progress Review progress against plan every Friday at 3:00 PM; Meet biweekly with my health coach to get feedback and discuss results.

  How I'll Manage Emotions When I feel discouraged, I will take 10 minutes to do a deep-breathing meditation and visualize myself as a healthy, fit person.

  Also think about specific resources you need—people, equipment, and so on, needed to achieve your key activities. Consider any other resources you need to achieve your key activities. As part of your plan, ask a coach, mentor, or other support person for their help. If they agree, solicit their feedback on the value of your goal and their suggestions about any changes or additions to your key activities. Entering key activities and any related tasks in your calendar will increase the odds you'll stay on track with your plan. Also schedule regular check-ins with a coach, mentor, or other support person to promote accountability and commitment and to help you adapt your plan as needed.

  STEP 3: IMPLEMENT YOUR PLAN

  One of the best ways to ensure you'll implement your plan is to schedule key activities and related tasks. It's not enough to say you're going to visit your mother at the nursing home several times a week. You need to put key activities in your calendar, just like you would any other “official” activity. When it comes to implementing key activities, don't leave anything to chance. If you know what actions you could take that would help you achieve a goal, put it on the calendar. A few years ago, Joe, one of the author Doug Lennick's clients, told Doug he wanted to get in shape. Here's how the conversation went:

  Doug: What are you going to do to get in shape?

  Joe: I'm going to go to the health club.

  Doug: What are you going to do there?

 
Joe: Work out on some machines and run a few miles on the treadmill.

  Doug: How often are you going?

  Joe: I think three times a week.

  Doug: How long are you going to spend there?

  Joe: Uh, well, maybe 90 minutes.

  Doug: When are you going to go there?

  Joe: Whenever I can.

  Doug: You say you are going to go three times a week for 90 minutes, and you know what you're going to do when you get there, but you won't really go. How often does it happen that you have nothing to do, and you think, “I'll go to the gym.” Let me tell you a plan that will work. Take me as an example: I lift weights twice a week. I play basketball twice a week. I play tennis once a week. They are all on the calendar. Do I miss doing them sometimes? Yes. But would I go if they weren't on the calendar? No. So, Joe, you need to put your schedule for going to the gym on your calendar and treat it as seriously as any other commitment.

  While you implement your plan, take a few minutes every day to visualize yourself successfully achieving your goal. Also anticipate any potential obstacles you may encounter along the way and think about how you could prevent or overcome them.

  By consistently working on key activities, the things that seem hard to do, or require sacrifice to accomplish a goal, can become sources of satisfaction. Research on happiness has shown that one of the characteristics of the happiest people is that they set goals and gain satisfaction from the process of working toward them. When we implement the goal achievement process, the anticipation of achievement allows us to enjoy not just the destination but the process. Especially when goals are aligned with values, we feel a sense of pride in doing something worthwhile and gain satisfaction when it's done well.

  STEP 4: CONTROL DIRECTION

  Controlling direction is about tracking progress and redirecting as needed. Implementing an imperfect plan perfectly won't work. Only rarely do we implement a goal achievement plan that doesn't require change. “Control direction” is a critical WDYWFY step because it allows us to keep score and make adjustments as needed. Consider this example: If an airplane takes off from New York for Los Angeles, it is off course 97 percent of the time. Air traffic controllers track where the plane is and provide input that calls for frequent directional changes, as well as altitude changes, often to provide minimum safe separation from other aircraft or to accommodate weather systems. The plane takes off and lands in the right places, but without keeping score and redirecting as needed, it might end up in Alaska instead of LA. Like a successful flight plan, Ryan and Joanie Goulart's plan for their European trip succeeded largely because they were able to recognize when their plan was going off track and change course as needed.

  STEP 5: THROW OFF DISCOURAGEMENT

  Working on a goal, like everything we do in life, triggers emotions. Take the example of a goal to lose weight. You've worked out every day. You're being careful about your diet. You're getting enough sleep. But when you step on the scale for a weekly weigh-in, you haven't lost an ounce. It's easy to feel discouraged, and in the throes of that frustration, you might impulsively order a pizza, which obviously does nothing to further your goal. Discouragement is only one of many emotions we may feel in the course of implementing a goal. We might feel scared that things will never improve, or we may feel anxious about what it will be like to succeed. (For example, “Who will I be, if I'm not the funny chubby one at the party?”) We may hit a milestone on the way to our goal that shows we've made a lot of progress, and become so excited that we get off track. Say that weekly weigh-in shows you've lost five pounds this week. Time for a piece of cheesecake, right? Wrong. “Throw off discouragement” is shorthand for sticking to your plan no matter what you're feeling, positive or negative. You will always have to deal with emotions. You can't control them as they rise up in you. But you can control how you think and what you do in the presence of those difficult to deal with emotions. If you're anxious, what should you do? Do your key activities. If you're ecstatic, what should you do? Do your key activities. It's that simple. As we've said before, it's simple but not easy. It's not easy, but you can do it. You can reach your goals. As Dr. Louis Pasteur, the famous nineteenth-century microbiologist, said, “Let me tell you the secret that has led me to my goal. My strength lies solely in my tenacity.”

  * * * * * *

  The Alignment Model and the WDYWFY Goal Achievement Model are proven approaches to help you maintain and enhance your financial, physical, and emotional well-being. In the next section of the book you will learn how to apply these powerful models to set and achieve mutually reinforcing goals at the intersection of money, health, and happiness. As you work on financial goals, you'll achieve greater financial security. You'll also discover opportunities to achieve health goals. As you focus on health, you'll notice you have the stamina and motivation to be more productive and successful in your work. As you work on happiness goals, you'll find that all areas of your life, including financial, physical, and emotional health, are improving every day.

  NOTES

  1 Though Donna chose to specialize in life coaching, there are a growing number of financial advisors who coach their clients in discovering their purpose and values, and support them in setting holistic goals for financial, physical, and emotional well-being.

  2 Dan Buettner, The Blue Zones: 9 Lessons for Living Longer from the People Who've Lived the Longest, 2nd Edition. National Geographic Partners LLC, 2011.

  3 Héctor García and Francesc Miralles, Ikigai: The Japanese Secret to a Long and Happy Life. Penguin Books, 2017.

  4 Dan Buettner, The Blue Zones: 9 Lessons for Living Longer from the People Who've Lived the Longest, 2nd Edition. National Geographic Partners LLC, 2011.

  5 Patrick L. Hill and Nicholas A. Turiano, “Purpose in Life as a Predictor of Mortality across Adulthood,” Psychological Science, 2014 Jul; 25(7): 1482–1486.

  6 Richard J. Leider, as told during keynote presentation at think2perform Annual Conference, Minneapolis, MN, October 2016.

  7 Richard J. Leider, The Power of Purpose: Find Meaning, Live Longer, Better, 2nd edition (San Francisco: Berrett-Koehler Publishers, 2010).

  8 Ibid.

  9 Adapted from Richard J. Leider, Repacking Your Bags: Lighten Your Load for the Rest of Your Life (San Francisco: Berrett-Koehler Publishers, 1995).

  10 Doug Lennick and Roy Geer, How to Get What You Want and Remain True to Yourself, Lerner Publications Company, 1995.

  11 Based on an exercise discussed by Jim Loehr in his book, The Only Way to Win: How Building Character Drives Higher Achievement and Greater Fulfillment in Business and Life (New York: Hyperion, 2012).

  12 Dan Diamond. “Just 8% of People Achieve Their New Year's Resolutions. Here's How They Do It,” Forbes.com, January 1, 2013, https://www.forbes.com/sites/dandiamond/2013/01/01/just-8-of-people-achieve-their-new-years-resolutions-heres-how-they-did-it/#515c0bae596b.

  13 Dominican University, “Study Focuses on Strategies for Achieving Goals, Resolutions,” press release, Dominican.edu, 2015, http://www.dominican.edu/dominicannews/study-highlights-strategies-for-achieving-goals.

  Chapter Four

  Money

  Wealth is the ability to fully experience life.

  —Henry David Thoreau

  Michelle Arpin Begina knows a lot about financial stress. She grew up in the 1970s and 1980s in a family with chronic money problems. Her mom came from humble beginnings and was thrifty by nature, though her husband never allowed her to participate in significant family financial decisions. Michelle's dad had come from a wealthy family, but unfortunately, he was a lifelong spendthrift. Whenever her dad had money, he spent it—sometimes on whopping extravagances such as planes and boats. When Michelle was 10 years old, her parents were so behind on mortgage payments that they almost lost their home. In 1985, her dad paid $185,000 in cash for a yacht. When Michelle asked her dad about money for college, he said he couldn't afford it. Michelle's dad didn't express remorse or seem to think he had a r
esponsibility to help her. His attitude seemed to be that it wasn't important for a girl to attend college. That's when Michelle realized she was on her own. Determined to keep her dream of going to college alive, she got a job right out of high school, moved away from home and went to college at night. Michelle's experience of financial stress was far from over. Struggling to pay for college and make ends meet on a low salary, her anxiety was, in her words, “off the chart.”

  Michelle has come a long way since those stressful early years. Now a successful financial services executive and certified retirement coach, Michelle says, “I do what I do now so people don't make the huge money mistakes that I witnessed as a child.” She and her husband, Mike, have put those painful lessons from Michelle's childhood into practice in managing their family finances. For example, they are very disciplined about saving for their two sons' college expenses. “One thing that makes me happiest,” Michelle says, “is knowing that, independent of scholarships or loans, full resources for college are available for our children. We've been contributing enough to their 529 accounts to send them to any college that accepts them.”

  FROM MISERY TO WISDOM

  Chapter 1 highlighted extensive research that confirms how widespread financial stress is: At least 75 percent of us feel some degree of financial stress. We tend to feel financial stress whether our income or net worth is objectively low or high. If we don't have enough money, or like Michelle Begina's dad, we'd have enough money if we didn't overspend, we feel stress. Even if we have enough money, we still worry, because we know that any number of unforeseen events could affect our financial security. We also know from research that financial stress has an outsized negative impact on other key areas of life. As financial stress increases, our ability to effectively manage emotions such as fear, anxiety, denial, or resentment falls. According to neuroscientists, when we are feeling stress, the part of the brain that processes emotions, the amygdala, is probably on overdrive, disabling the logical part of our brain, the pre-frontal cortex, which under high-stress conditions is barely operating, if at all. Overwhelmed by negative or competing emotions, our decision-making and behavior becomes increasingly irrational. And when we're in the throes of an irrational decision-making process, we do things that harm not just our finances, but our physical health and overall happiness. Figure 4.1 shows the process by which financial stress leads to poor life outcomes. Notice that the graphic is in the shape of an “M,” which appropriately stands for “misery,” since the basic result of financial stress is that it makes us miserable.