I wrote on my previous post about doing things a bit differently this year. Deciding and setting appropriate goals are one of them. I came across this post written by Tim OReilly which I found very interesting and thought I’d share it with you. It is worth taking time to read through but I summarize the key points here.
Work of stuff that matters. This does not mean doing non profit, “do good” charity work. It does mean building a business and economy (a financial life) that is sustainable long term. You have to decide what stuff matters to you.
Ed’s take on a personal financial level: Your effort should focus to build up a sound financial plan that is sustainable. Not a few fat years of lavish living followed by depravity a few years later.
1. Work on something that matters to you more than money
Although you should having financial goals, have a goals that is more than just making money for yourself. Think of money as fuel for what you really want to do, not as a goal in and of itself. Money is like gas in the car you need to pay attention or you’ll end up on the side of the road but a well-lived life is not a tour of gas stations!
Have a big goal. Google’s motto, “access to all the world’s information” is an example of such a goal.
2. Create more value than you capture
Ideally, your goals should create more value than it captures. Example, micro finance lifts people out of poverty. As more jobs get’s create, more people borrow more and everyone benefits.
Wall Street and Bernie Madoff did the opposite and everyone knows what happened. If your goals and what you do create a circle of value, the impact it create start to perpetuate and you create an ever larger spiral effect.
3. Take the long view
See the big picture. While it is good and a must to have short term goals, it is important to see the long term as well. Tim goes on to say, the economy has many elements of a ponzi scheme. While his last point is kind of short without much explanation (or I can’t understand where he is taking it), I agree that financially, your life goals should have in view the long term view.
With such a view, your financial decisions are not just focused on the here and now which tend to fluctuate a lot depending on the state of the economy. Such fluctuations are here to stay if anything.
The whole article is here .
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