Set Smaller Goals!

Most people don’t stick to their New Year’s resolutions.

Stop setting goals that are too large!Have you noticed how crowded the gym is every January? Try comparing your January experience at the gym to your June experience. It is night and day.

Last month I could go down to the gym at any hour and use any machine without waiting. This month all of a sudden the place is hopping.

Each month for the rest of the year it will get less and less crowded until we start over next January. We see the same thing play out every year.

People set ambitious resolutions every January and then gradually drop them all over the course of the year.

There are a number of reasons for that (including failure to set good goals) but today I want to focus on one particular problem.

A Fresh Start…

We generally have lots of motivation and inspiration to change in January.

We have big dreams and big goals. We believe that this is the year that we’ll turn it all around.

We’re refreshed from the holidays. We’ve gotten a little time off of work. We’re filled with the charity of the Christmas season and the optimism of the new year.

The turn of the calendar brings us a fresh start and we are inspired by that.

But here’s the thing about fresh starts: they don’t exist.

…Or Just a Fresh Calendar

After the calendar flips, we are still the same person. We still have the same life. The same obligations and responsibilities. The same strengths and weaknesses. The same friends and family.

We get a fresh new calendar, not a fresh new life.

And that’s a good thing! I don’t mean for this to sound pessimistic. Just imagine how difficult life would be if we had to start from scratch every year!

The point, instead, is that we have unfair expectations of the power of a new year.

We set our sights too high. We bite off more than we can chew. We do another repetitive metaphor that means the same thing.

Think Small for Big Results

The solution isn’t to avoid setting goals. Or to lower our expectations in life.

It is to have smaller, but more sustainable, goals in the short term.

We have a tendency to overestimate what we can do in the short term and underestimate what we can do in the long term.

There are various versions of this idea floating around the Internet attributed to various sources. We overestimate what we can do in a day and underestimate what we can do in a month. We overestimate what we can do in a year and underestimate what we can do in ten years.

The idea is the same. When setting goals, aim for the long term and the big picture because you can achieve more than you think.

To get there, I recommend small, sustainable goals that you can make stick.

Get Your Snowball Rolling

In the personal finance space we’re all about compound interest.

Your money grows slowly at first. That growth leads to more growth. Which leads to more. The more money you have, the faster it grows.

It is a snowball rolling down a hill. The bigger it gets, the more snow it picks up as it travels.

We recognize the power of this principle in dealing with our money. Why don’t we apply it to our self-improvement?

If we can improve a skill by 0.2% a day, we will have more than doubled our abilities over the course of the year.

Compounding is powerful! The key is that you need to keep going.

Home runs are great. But singles are a heckuva lot easier and can do just as much damage when strung together.

Don’t Underestimate Psychology

It’s not just the ease, though.

As humans, we constantly underestimate the role that psychology plays in our life.

Dave Ramsey gets a lot of people out of debt.

He also drives a lot of us crazy by recommending that you pay off your smallest bill first rather than your highest interest bill. If you’re looking at the math, this makes no sense. Paying off the smallest bill first rather than the highest interest means that you are going to be paying more money in interest. If you want to get out of debt, why would you voluntarily pay more to your debtors?

His program works for a lot of people because of the psychological aspect. When you pay off that small bill, you see that it can be done. You get a small win. You build your confidence.

If you tackle the highest interest debt first, and it happens to be a massive debt, it can take years to work your way through it and dig out the other side. This can be demoralizing. If you don’t have a strong enough motivation to get out of debt, this demoralization can lead to giving up.

Losing Motivation

This is what happens with our goals.

We set out for big achievements. It works out well for us in January. Our motivation us high. We’ve got a fresh start!

That motivation dries up throughout the year, though. Life keeps moving and we don’t feel hugely different. That fresh start doesn’t feel like its panning out.

Once we hit some obstacles or setbacks, we have no motivation left to fall back on. We quit.

Big goals are great. But only if you have the motivation to follow through.

Otherwise, you’re better off making those small, sustainable changes and letting them compound over time.

Filtering Advice

If you’ve been reading along this month, you can already see where I’ve taken the standard advice and run it through this filter.

I explained that most life planning tools suggest taking a single day, analyzing every aspect of your life, and creating a comprehensive plan to address everything. I also explained that I’m not going to do that.

With the exercises that I recommended, I suggested picking one area of improvement at a time. Tackling one problem first before moving on to other issues.

This is all because I truly believe in leaning heavily on small, sustainable changes rather than swinging for the fences.

Success Leads to Success

With this in mind, take another look at your plans for the year. What parts are sustainable? What parts need to be broken down into simpler habits?

Maybe you want to be a kinder person. It’s hard to become the nicest person in the office. It’s easy to ask a different person what you can do to help them each week.

It’s hard to be nice to everyone all the time. It’s easy to develop a habit of always holding the door for the person behind you. Or always smiling when you interact with someone in the service industry.

It’s hard never to be annoyed with a spouse. It’s easy to write in a journal each night and list one thing you did well and one thing you could’ve done better.

These small changes lead to big results over time. And once they become ingrained habits, you can add another small step on top. Success leads to success.

Join the Conversation!

I’ll be making small changes in January and will continue making them throughout the year. Some will be chronicled here. I’ll also be doing regular updates to see what is working and what is not working.

What about you? Will you be making small, sustainable changes for the new year or are you swinging for the fences? Either way, what changes do you plan on making? Let us know in the comments!

And if you want more, feel free to check out the email list!

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6 thoughts on “Set Smaller Goals!”

  1. Great points Matt. Dave Ramsey’s teachings drive me a little crazy. Some are very sub-optimal. Yet, he’s been able to improve the financial lives of so many people.

    I’m on board with small goals. I set my fitness goal this year to exercise twice a week. I’m also defining exercise loosely. I just need to do something semi-regularly. I’d obviously hope I end up working out 6x a week and get in peak shape. I know that a “peak shape” goal is way to lofty to give me the proper motivation.
    Jason@WinningPersonalFinance recently posted…3 Steps to Improve Your (Financial) Health In 2018My Profile

    1. I’m with you, Jason. One of my most viewed posts is about why I disagree with Dave Ramsey’s advice ( I was surprised by the number of people that stepped up in the comments to defend him and disagree with me. I think that because looking at the numbers works better to motivate me, I was underestimating the importance of the psychological wins for others.

      Thanks for the comment!
      Matt recently posted…Successful Careers and Failed RelationshipsMy Profile

    1. The focus on simple actions is definitely huge. My writing goals is to write for an hour every morning. I’ve revamped a bunch of my old morning habits to help make the time for it and figure that if I set a time limit rather than an output goal I’ll avoid the pressure associated with feeling like I need to achieve at a certain level. I just need to sit down and write. We’ll see how it works out.

      Thanks, Erik!
      Matt recently posted…Successful Careers and Failed RelationshipsMy Profile

    1. I do love the addictive feeling of productivity. I’ve started reworking my to do lists so that I start the day with something big and important and then follow that up with a whole bunch of easy little things. Then I get the boost of both accomplishing something important and crossing a bunch of things off the list.

      Thanks for stopping by!
      Matt recently posted…Successful Careers and Failed RelationshipsMy Profile

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