I was just thinking about something: Much of my financial goals are based on the idea that I have lots of time until I retire.  Some of them are rational, some of them are just pipe dreams.  I need to let go of the dream mentality and focus in on actual and practical solutions to the goals and the problems that might get in the way.  For example, if I want to become a millionaire before I retire (which will be required for me to retire) I have to make a decision: how much will I save to attempt a guaranteed millionaire goal?

If you make a goal to be a millionaire and you’re starting at 25 with a projected interest rate of 8% it will take you $8,000.00 a year and 31 years to reach that goal.  But if you’re in my shoes and starting later than that you will have to save $20,000.00 for 20 years to reach that number.  The fortunate part is that in ten more years (reaching sixty-five), without adding any more money to it, you will become a 2.3 millionaire.

However, you have to decide that you’re going to reach your goal and that you’re willing to set aside the money required to reach that goal!  You can’t sit around hoping it comes to you - you have to call the shots, execute the plan, and stay focused.  The consequences for my actions are long term - each $5.00 trip to the coffee house, each $20.00 quick lunch for myself and my wife and kids is a cut into that future life I have as a goal.  I need to make those decisions now and follow through.

Everything else is just dreams, dumb luck and tom-foolery.

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This entry was posted on Thursday, October 25th, 2007 at 10:47 pm and is filed under Foundations, Investing, Lesson Learned, Retirement, Tips'n'Tricks. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site. No tag for this post.