In comparing the people who meet their financial goals with those who do not, Sarah Milton at Retire Happy identified three key factors: "a clear, achievable goal, a solid plan and a strong motivator for success."
She said it’s essential to factor in the “fun factor” of our goals because, let’s face it, with so many pleasurable ways to spend money, saving it had better be enjoyable as well. It’s also important to balance spending and saving so you’re not just living in the future.
Then there is something Milton calls the “friend factor.” Friends can either support our goals and hold us accountable to keeping them, or they can indirectly or directly sabotage those goals, justifying our excuses to stray from the path. While it may not be what we want to hear in the short-term, over time we will appreciate those friends who help us achieve what we say is most important to us.
See: Who’s Sabotaging Your Financial Goals?
People can influence our spending and saving even if we don’t know them. An article in the New York Times looks at how two different online retirement savings statement tools allow users to compare their savings against other account holders in a similar income and age bracket.
They're hoping to capitalize on the tendency to watch and compare ourselves to our friends' activity online – so prevalent on social networking sites like Facebook.
Instead of "Keeping up with the Joneses," the companies behind these tools hope we'll try to "Save like the Joneses."
See: A Nudge to Save a Bit More.
Credit mistakes you can recover from
No one is perfect when it comes to financial habits and choices, and some mistakes are more detrimental than others. In an article at U.S. News Money, the encouraging sub-title promises that “it’s never to late to fix your ‘I wish I’d…’ mistakes.”
1. I wish I’d stayed out of credit card debt
2. I wish I’d opened a credit account sooner
3. I wish I’d paid my bills on time
4. I wish I’d made smarter borrowing choices
While each of these past money mistakes impacts your credit rating, there are things you can do today to turn things around.
See: How to Overcome Four Major Credit Regrets.
Mistakes are a good thing
While it’s common to think of mistakes – financial or otherwise – as something to be avoided at all costs, in reality they are a crucial element of our development and achievement. After citing some well known examples of “failures” who turned out to be very successful (e.g., Thomas Edison failed more than 10,000 before inventing the light bulb), Robert Kiyosaki shares some Rich Dad wisdom about mistakes.
“He often said, ‘There is a bit of magic hidden in every mistake. So the more mistakes I make and I take the time to learn from, the more magic I have in my life.’”
He expresses the point that playing it safe to avoid mistakes also keeps us from absorbing valuable lessons and making accidental discoveries.
See: The Magic of Mistakes