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Living Without Financial Goals


"A good traveler has no fixed plans, and is not intent on arriving."

-Lao Tzu


It's hot as we drive through wine country, but we don't mind. We live in Minnesota; the windows are rolled down as we enjoy the heat. We arrive at our first winery near Geyserville, California.

Inside the winery, we do our tasting, check out the grounds, learn about wine generally and their wines specifically. Before heading back to the car we walk through their garden and get a couple more photos before taking off to the next winery. We are trying to hit as many wineries as we can. You might say our goal was to visit a specific list of wineries today, and a new list of wineries tomorrow.

As we're sitting outside at a picnic table eating lunch at our third winery, we realize we're tired. We are staying at a place that has a hot tub outside with a nice view. We pivot. We buy a bottle of wine from the grocery store and go back to base camp.

The next day on our morning run we decide to tone it down. We want to go to exactly two wineries. This time we will be staying at each of them a lot longer, enjoying the winery, learning more about their wines, and relaxing outside.

Some might say that our vacation was a failure. Indeed, we did not hit our goal of visiting all the wineries we had in mind. But instead of focusing on how many wineries we visited, we were able to focus on opportunities we almost missed, like staying longer at fewer wineries, having good conversations, and relaxing. We changed our minds in part because we realized that we didn't predict how tiring and unrelaxing it is to constantly hurry from place to place.

We view our vacation as a success. Instead of focusing on the original desired outcome of visiting a large list of wineries, we focused on the process of enjoying our time, the weather, each other, and living in the present. We changed our minds when we wanted to.

Living a life without financial goals is like vacationing without a set plan.

goals don't matter

Goals: The Traditional View

The traditional view of personal finance - and life in general - is that you have to set goals. If you don't have a goal, they'll say, then you have nothing to aim at. If you have nothing to aim at, then you won't end up anywhere. Goals are supposed to help focus you and help you figure out what you want out of life. Once you have your goals, then you can set subgoals and put together a plan to meet all your goals. Some experts tell you that your goals have to be SMART, because, you know, you don't want dumb goals. This focus, the saying goes, is what gives people the drive to go after their goals.

Issues With the Traditional View

I'm not arguing against finding motivation and drive to pursue what's meaningful to you. I'm simply here to let you know goals have downsides, and I firmly believe it's why so many people struggle.

Let's talk about the idea that without a goal you won't have anywhere to go. It doesn't take much contemplation to realize that just is not the case. Leo Barbauta, the founder of Zen Habits, would ask you to walk outside without an agenda. Just walk around, wherever you feel like going. You'll definitely end up somewhere. You can design a life with meaning, and have motivation to pursue what's meaningful to you, without goals, just like you can walk around outside without having a destination in mind.

Goals set you up for failure more often than you think, they increase anxiety, and they prevent you from fully living in the present, being satisfied with what you have.

Let's explore the downside of goals in more detail.

Future Is Unknown

Goals are future-oriented. The future is unknowable. There's more that can go wrong in the future than you can control. Almost by definition, you are far more likely to miss your goal than you are to attain it simply because there are so many things that are outside of your control.

You might set a goal to lose 10 pounds by summer, but come down with the flu and have to rest for a month. You might set a goal to run a marathon in under four hours but sprain your ankle during training, rendering yourself unable to participate. You can set a goal to get your boss' job, but get laid off due to corporate downsizing.

In a world where we call it a success to hit our goal and failure to miss it, setting goals sets us up for failure more often than not.

We can't control the future. Life happens. By no fault of your own, it's likely you will fail to reach your goals. There are more ways to miss your goal than there are to hit it.

Missed Opportunities

When you are intently focused on achieving your goal, you have tunnel vision. Your goal is crystal clear, but other opportunities are blurry, at best. Focusing in on your goals leaves you blind to the opportunities you may be missing. This could mean gunning for your boss' job caused you to miss an opportunity at a different company that is a step up from where you were focusing. In personal finance, it could mean doing everything in your power to retire at 55 from a job you hate only to miss an opportunity to take a job that you love and would be happy to work for another decade or longer.

If my wife and I were laser-focused on hitting our goal of visiting 10 wineries in a day, our satisfaction with our trip wouldn't have been as high as it is.

No Contentment

We're all pretty much wired to want to improve ourselves. It's natural and it's good. The problem with too much focus on goal-setting is that it can cause us to lose gratitude for what we already have. You probably know someone who worked at a company that did really well, only to have the annual and quarterly goals revised upward, leaving everyone disappointed.

Obsessive goal-setting and the ensuing quest for goal-achievement are at odds with gratitude. You might be thinking that it's totally possible to be thankful for what you have AND set your sights high on lofty goals, and I would agree with you that it's possible. It's possible in the same way it's possible for a high school basketball player to get drafted into the National Basketball Association.

Millions of people in the United States alone suffer from an anxiety disorder, and those with anxiety have a good chance of also suffering from depression. Many more feel anxious and depressed without having a disorder. Finding ways to reduce emotional disorders should be our focus, not setting people up to feel anxious about whether or not they can hit goals or depressed about having missed their goals.

Outcome vs. Process

This may sound obvious, but achieving a goal means getting a specific outcome. It doesn't say anything about how to get there. That is, the result is the goal and you use a process or a system to get there. Focusing on your goals misses the point.

My wife occasionally watches a show called Hoarders. All of the hoarders, or more specifically the family of the hoarders, have a goal to get the house clean. They have a clear, SMART goal. It's Specific - they want to have the house clean and livable. It's Measurable - they can literally see if progress has been made. It's Actionable - the crew hires those responsible for cleaning it. It's Realistic (most of the time) - meaning, it can be done. Finally, it's Time-bound - they set a deadline.

Focusing on the goal, that is, the result, does nothing to change the process, though. Without fixing the problem upstream the place will get messy again, at which point they can set another SMART goal to clean the house. And on and on they go.

A better approach is to learn a new system.

Systems: A Better Approach

Dilbert creator Scott Adams says talks about using systems instead of goals in his book How to Fail at Almost Everything and Still Win Big. He defines a system as something you do every day that adds value to your life. A goal is something that is only met at some point in the future.

Here are some examples:

  • Losing 10 pounds is a goal.

  • Eating right is a system.

  • Running 500 miles this year is a goal.

  • Being active every day is a system.

  • Getting a promotion is a goal.

  • Making yourself more marketable is a system.

The trick to implementing a good system is to give yourself permission to give up on any specific outcome. The process if more important than the outcome.

Let Specific Outcomes Go

If you've read this far you might be thinking to yourself that it's scary to set out on a journey without knowing the destination. Nobody likes question marks at the end of their path.

Do What You Feel Like

It's natural to be nervous about not knowing where you're going, but with practice and time, you'll learn that it frees you up. You can now do whatever you want, provided you've set up your system properly.

This is a good time to make it clear that just because you don't focus on the destination doesn't mean you ignore picking a destination. Author Carl Richards stopped calling them goals, mostly because goals seem permanent and can fill us with anxiety. Instead, he calls them guesses, and we give ourselves permission to change our minds when life happens.

Once you have a flag in the ground that represents your initial guesses, you can start making progress toward getting there using your system.

The trick to changing your mindset away from focusing on goals is to not let yourself get hung up on whether or not you get to your first guess. Remember, something better might come up. Your interests might change. You might learn some new information. Something unexpected might happen. You don't know. But focusing on systems instead of goals gives you permission to change your mind.

Being able to change your mind gives you far more possibility. You can change your mind and make another guess.

You might change your mind again, and that's ok!

Your life should be about the journey, not the destination. Have fun and enjoy the ride. Don't let yourself get hung up on outcomes and goals.

I know it's frustrating when you want to make a change. The seemingly obvious answer is to decide to change your outcome. It's not as obvious to think about changing your system, but it will work better for you in the long run.

Author Seth Godin talks about juggling by telling you to focus on the throwing, not the catching. If you've ever tried to juggle you know how frustrating it is to miss the ball. It's easy to think we need to get better at catching the balls. Godin points out the not-so-obvious fact that instead of getting better at catching, we need to get better at throwing. If we get the throwing right, the catching takes care of itself.

If you get your system right, your outcomes (goals) take care of themselves.

Author Simon Sinek, in his book Start With Why, talks about a Golden Circle. The Golden Circle says that our core is our Why, it's our reason for getting up in the morning; it's a belief. Around that is our How. Our Hows are the actions we take to realize our core belief. Finally, on the outside are the Whats. These are the results of those actions. He proposes we start with our Why and build a Golden Circle around that.

It can be helpful to think about your personal finance system through the lens of the Golden Circle.

Your core is made up of your personal values, or your life aspirations. This is what money's purpose is in your life. Money is a tool that allows you to live your life according to your values. Around that is how you live your life in a way that meets your most important values. Last and least, the outside of the circle are the outcomes. I'm urging you to start at the center and work your way out instead of starting on the outside.

This sounds scary, and to be sure it's a different way of thinking. You have to spend some time up front designing your life and your systems. It means you have to do the hard work of figuring out what kind of life you actually want. And that's not easy. It takes courage to accept that you don't have to set and track goals. If you put in the time, though, you'll be happier and have more free time - free time that you can use to enjoy your life.

You only have one life. Live intentionally.

organize your financial mess

Read Next:


Scott Adams YouTube Channel: Scott Adams Connect 2014 Keynote

Anxiety and Depression Association of America: Facts and Statistics

Berkely Hass YouTube Channel: Keynote: Scott Adams, creator of Dilbert

Jordan B Peterson YouTube Channel: Take Aim, Even Badly

Simon Sinek: Start With Why

Wikipedia: SMART criteria


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© 2020 Money Health Solutions, LLC



About the Author

Derek Hagen, CFA, CFP, FBS, CFT-I, CIPM is a speaker, writer, and coach specializing in financial psychology, meaning and valued living, resilience, and mindfulness.


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