A personal business plan consists of the process of putting your “business” goals on paper, while providing the steps to achieve such goals.  Some of you may think that this may sound a lot like standard goal setting, however, there are distinct differences in setting up a business that makes it a very worthwhile task in your own financial planning.

First off, your personal business plan should be related to your business only.  This is not to say that you shouldn’t make goals in other aspects of your life, but for this particular plan, it should be solely focused on your personal business efforts.  The plan applies to any line of work you may be in.  Whether you are a CEO of a Wall Street firm, a pet groomer, or a landscaper, you should begin every new year with a fresh business plan.

Your business plan should break down what it takes to be successful in your line of work and how exactly you are going to accomplish that.  Kobe Bryant did not wake up one morning randomly knowing how to shoot a jump shot.  It took years of practice and discipline for him to get where he is today.  The same goes for any other occupation out there.  In most cases, people did not fall in the positions they are currently there by luck.  They planned out what it took to get there and how they themselves were going to make that happen.

Lets take, for example, an insurance salesman.  After looking at his last years call log, he finds that he made a total of 1500 cold calls to new potential clients per month (18,000 per year).  Well, as a result, he made a total of of $180,000 in commissions for that year.  So technically, this salesman can conclude that every call he makes is roughly worth around $10.  Of course this is really not the case, but for most sales jobs, performance is merely a numbers game.  Knowing that he historically performs at this $10 per call rate, he can than adjust his daily call schedule to earn his next year’s goal of a $200,000 year.  This same principle can be used in a variety of different measures.

A business plan should also include desired characteristic traits you wish to possess around the workplace, as well as things you feel you need to work one.  Take note of people around the office who are succeeding.  What attributes do they possess.  The best way to become successful at work is by surrounding yourself around people who already are.

Be specific about your monetary goals.  If you want to earn $100,000 next year, write it down!  If you don’t, it will be hard to see how exactly you get there.  The above example showed our salesman that one way he could get to his new “lofty” income goal is by increasing his daily call amount.  While breaking down your business plan, you will visually see just what it will take to earn what your goal is.

Now some of you may be saying, “well I’m stuck in a salary position and have no way of making anymore money than my contracted amount.”  Nonsense!  Within your company there are ladders of salaries.  Most likely there are people around you making the money that you desire to.  What are these people doing differently?  If you are just as qualified and talented as these people then there is no excuse for them making more money.  If you lack certain skills that they have, work to sharpen those skills.  Come to work earlier and stay a bit later.  Remember, you set the goal so it is you that needs to make it happen.  If you do have the same skills and are not making the same amount, go see your manager.  You would be surprised about how many times you are worthy of a promotion and they just don’t know it or are waiting for you to say something.  If they feel you are not qualififed, ask him/her for feedback about what you are lacking.  Then, start this process over.

Also, we live in a day of age where you can make money in a variety of different ways.  Thanks to the internet, you have access to the whole world to try and make money.  You have certain skills and traits that people will pay money to learn.  See how you can integrate that on the web for some supplementary income.

Sure, we all like to have money and success, but strive to keep it within reason.  As I have always said, money is not the definition of “success” and more important things should not be sacrificed for it.  When making your business plan, consider your other “life goals.”  If doing what it takes to earn you’re desired income only happens at the expense of acheiving your long term life goals, it is not worth it.  Consider thinking a few years out on how you consider to reach these goals, thus not burning yourself out all in one year.  Why work to make a good living, when at the end you cannot enjoy the fruits of it.

After completing a business plan, always keep it where you can see it daily.  Why spend time on this intensive document if you’re not going to reflect on it?  I keep mine in the top drawer of my office, so that when I do get frustrated, I can see what exactly I’m doing wrong.  The business plan doesn’t lie.  If done correctly, it acts as the Holy Grail of successful business practices for you personally in your business.  If you’re not seeing success, you’ve most likely waivered from your plan.  Take it out every week to make sure you’re living up to your goals.  If you are doing what you set out to do and are still not seeing success, revise your plan in way that points you in the right direction.

The power of a business plan is great.  When just asking how can I earn $100,000 a year?, it can seem distant and unattainable at the moment.  However, when really breaking it down, studying your current circumstances, and implementing a plan, you will be surprised at just how easy that road can be.  This combined with other principles discussed on the site can help you.

For me, success means joy or happiness. Sure, money can make life easier or seem more enjoyable, but it cannot be the sole source for success. Many very wealthy people of our society have shown through example that money cannot buy that happiness that everyone searches for. That is because there is more to the equation.

Success begins from inside of you. The lesson of setting goals is an essential part of finding success in our life. By planning and setting goals, we are able to define what success is in our own life. What drives you? Why do you get up in the morning? What is your passion? These are questions you should be asking yourself. Get together with your spouse, if you have one, and ask them how they define “being successful.” The point is, you should consider finding success as more than just finding financial gain.

Another important element of finding success is living a balanced life.  Call it moderation, yin and yang or whatever.  We, as humans, have many needs to facilitate happiness in our life.  It is important that we stay sharp on all aspects of life.  In my experience, I have found most happiness when I am balanced in the four following life traits: Relationships (family and loved ones), Health, Spirituality (this does not necessarily mean religion), work or education.  For me, these are the four main traits I try to balance.  Of course, some may be more focused on than others, but I have found that if I remember not to forget about building up these four traits by keeping them all continually improving and growing stronger,  I feel most “success” in my life.

Sit down and find out what needs balance in your life.  Usually, when we are continually waking up with a bad feeling in the back of our head that keeps nagging us hour by hour, it is usually because we have not kept one of our “core success traits”  in balance.  Try and find out which trait it is and how you can improve it.

As you find success, show gratitude for it.  Whether it is to God, your family, people who are struggling or other means, giving back is an essential part of enjoying success.  You will not reach success on your own, make sure to always show gratitude to those that help in that path.  Gratitude is such a big principle in my book.  I will expound on it more in another post.

When setting your goals, make sure you find out what your “being successful” definition is.  In doing so, you will place that magnet that will continually pull you in reaching your goals.  It will also make you truly happy when doing it.

So where do you begin? There are many methods of goal setting that can be found. All of them entail pretty much the same basic principles. The best thing to do is find out which one best fits you and your personality. I will discuss what I use and what works well for me.

SMART. Goals

S.M.A.R.T. is a popular goal setting acronym that helps outline what exactly your goals should be. S.M.A.R.T. stands for Specific, Measurable, Attainable, Realistic, and Timely. These are great words to help set guidelines to keep your goals within. Lets break them down one by one.

Specific

When setting goals, try to be as specific as possible. For instance, “I want to be happy when I’m older.” That is very vague and doesn’t give you a good timeline to work around. What makes you happy? How about, “I want to retire by 45, live in a two story house in the rocky mountains and have enough money to support my family, vacations and of course my season pass for skiing.” By defining what your happiness is, you can see better what needs to be done to achieve that happiness. So now I know my cutoff time to be earning a “salary in the office” is 45, and all of a sudden I have an actual timeline. I can begin planning how much money I need to earn before that given time, what I should be saving, and other “sub or short term goals” to help me achieve my “large or long term goal.”

Measurable

This goes hand in hand with being specific. If you are not specific in setting goals, then there is no ability to measure your progress of how well you are doing to achieve those goals. If you say, “I am going to do better at work this week,” that is hard to measure. If you say, “I’m going to do better at work this week by getting in earlier, contacting more associates, maintaining focus, taking shorter lunches, etc”, that becomes a lot more measurable. Accountability is a very important part of setting goals. In fact, I recommend using a spouse, family member, or someone else close to you as someone you can report to. Show them some of your goals when you set them, and ask them to check up with you at least once a month. If you need to find a “life coach,” then do it. They’re worth the money(well, some of them). They will not forget to hold you accountable for your goals. A wise man once said, “when performance is measured, performance improves. When performance is measured and reported back, the rate of improvement accelerates.” It is true that if you are given someone to report back, your performance will improve.

Attainable

That famous quote “you can do anything you want to with the right attitude,” well, it’s false. There is a strong power that comes from positive thinking and attitude, but us as human beings, have our limits. There is only 24 hours in a day, and you can never change that. It is good to maximize your time, but do not set goals that are too much to handle. By doing so, you will get burned out and your goals will get pushed to the side. By setting goals, recognize the things that must be done to attain that goal. If you have to, start out with small goals until you feel more comfortable with bigger ones. A small goal is better than none.

Realistic

Attainability discusses the steps required to achieve the goal, where being realistic describes whether you “believe” in that goal. There is no use setting a goal, if you don’t believe you can accomplish it right off the bat. Set goals that you honestly believe you can accomplish. Sure, goals should stretch you and may seem like a big mountain to climb. But recognize you can climb that mountain. By believing in the goals you set, it makes the attainable part a lot much easier.

Timely

Goals should be bound with a timeframe. In fact, for me, I like to break my goals into three timelines” Short Term, Mid Term, and Long Term. Short term are goals I want to be doing today. Changes I can make at work. Things I can do to make me a better husband. What I want to accomplish this year, etc. I try and reflect on these on a weekly basis. These are the “trench goals” that keep the wheels spinning for the other two. Midterm goals are ones I see accomplishing anywhere from 5-20 years. When do I want to retire, how many kids do my wife and I want. Where do we want to live, etc. I like to reflect on these goals about every quarter, to keep them fresh in mind. From there, I can critique my short term goals if I am a bit off track. Last, are my long term goals. These are anywhere from 20 years an more. These are things I want to be read at my eulogy. I want to have done these things by the time I die. Even though some of these may be several years out, it is good to start reflecting on them now. I try and reflect on my long term goals a couple times a year.

So that breaks down the SMART goal system. It works well for me. If this system doesn’t work for you, find something that does. Everyone is different.

Review Often

An important part of these goals is to remember to review them! It is such a shame to devote so much time drawing up your life plan and then to shove it in a drawer, never to be seen again. Print them out (especially short term goals) and put them everywhere. Put them in the bathroom, fridge, car visor, on your desk at work, next to the remote, and wherever else you see yourself during the day. By continuing to see them every day, you will be better at accomplishing them. I use to carry around a personal planning sheet. It was a weekly sheet that had everyday listed with hourly blocks. I would map out my week every Monday and fill in the time slots as best I could as well as writing my short term goals on it. Sometimes, my duties seemed overwhelmed and I didn’t know how I was going to get everything done. I would then fold it and put it in my front pocket and carry it at ALL TIMES! Even though this was the busiest time of my life, I was able to get more done and live a more balanced life than any other time in my life. I woke up earlier and was better physically conditioned, as well as learning more all in the same amount of time in a day. You don’t need a fancy, leather-bound day timer or Iphone. All you need is a piece of paper.

Include Family

If you are married or are living with a partner, you know that many of these goals will be shared with others. It is important to include your family when setting these goals. Although some goals should be personal goals for you to work on, many of your goals should be discussed with your family, since they will be with you every step of the way. Get with your spouse or partner, and share your goals with each other. You may find that living in the Rocky Mountains is not what your husband/wife had in mind when you retire. Together, develop joint goals that will make you both happy and reflect on them together. This can be a great experience.

Just beginning to plan your goals will get you excited. As you set these SMART goals or whatever works for you, you will see on a daily basis ways that can help you achieve your financial freedom. Like I have said before, the vision is the first step. Without it, any success we find is pure luck.

It is amazing to me how so many people run around living life and going to work without conscientiously being aware of what thing is that they are working for.  Before you can even begin to start financially planning for your life, you need to know what it is you want to get out of life.  Set goals. Geoffrey Abert said, “The most important thing about having goals is having one.”  It seems so easy, but many times can be the most difficult step.

Going throughout life without a goal set is much like trying to navigate a ship in the middle of the ocean without a compass.  Every direction looks like it could be right way and it is hard to tell if you are being led the wrong way.  Having goals gives you a vision to work for.  Goals also act as an accountability of your performance.  With a goal set, all of a sudden you have something to track your progress.  It allows you to look back on your performance and make changes to help you get back on course.

The meaning post is not to focus on the principle of how to set goals (see how to set effective goals), but instead to emphasize the fact that you cannot progress anywhere on this website unless you have taken this first step.  You may stumble onto wealth and financial freedom sometime in your life, but if you have no purpose or reason for your life, you will not know what to do with that freedom.

Not only will setting goals for your life help you begin in your journey for financial freedom, but it will also be a driving force in continuing to motivate you to work toward that financial freedom.  I can’t tell you how many times in my life where I had been frustrated with something at work and I just wanted to walk away and try something else.  By having my goals and being able to reflect on them helped put me back on track and accomplish the things I needed to do.  You will be amazed by what the power of having a goal can do for you in your life.

Abraham Lincoln said, “A goal properly set is halfway reached.”  How true that is.  If you haven’t already, take some time out and think of what is important to you in your life.  By doing so, you will see just how easy it is to reach those goals.  Step 1 to personal financial planning is: Setting Goals.

Although some blame is to be placed on the banking systems for their loose underwriting and allowing such bond valued to be skewed.  However, us as the consumer should also be held accountable, as we are the ones that put the signature on the bottom.  Many people out-leveraged themselves and tried to buy houses that were outside their means.  The banks should have been there to reject the loan, but they weren’t.  In any case, key principals of personal finance and financial planning were overlooked as people got in way over their heads.

It is my goal with this site to help provide information and tips that have helped me to find financial freedom and let me enjoy spending time with my family and doing things that are important in my life.  Even though money is essential to survive during your life, with planning and execution of basic financial principals, you can find financial freedom to do the things that you want with your life and leave the burden of bills behind you.  It’s up to you!

Here you will find articles, calculations, tips, strategies, and other methods that have helped me and are essential to know in order to make big decisions like when should you buy a house?  Or when should you rent an apartment?  These can all be confusing, but with the help of goal setting and financial execution, these questions can become quite clear.

I hope by visiting this site, you can learn something that you can do to better your financial progress and help you get one step closer to be free to do what is important to you!