To earmark the beginning of this financial journey, it helps to know what my goals are so that I can work towards them. And I have used the SMART framework both in school and in my professional work. It’s useful because it gives clarity to what I want to achieve. It also helps that I’m focused on the purpose behind making money and not just aimlessly trying to get rich. So here goes:
Specific: $10,000 monthly passive income by the age of 60.
I want to make sure that in the financial decisions I make, it is to ensure that I see passive cashflow even if I no longer hold my day job. Giving tuition or running a business on the side doesn’t count unless it can still bring in money without me having to constantly put in time for it.
Measurable: I will have systems in place that can provide me that cashflow passively.
It can be investing in the stock market or being a silent partner in a business venture. I do not know how they will look like in the future, but this much I can share today – I had an average of $185 of monthly dividends in 2019.
Assignable: Both my wife and I will work together towards this goal.
We sat down one day and discussed it and then laughed at each other. Sounds lofty and some may say, impossible. But we’re putting it out there now and we are going to try.
Relevant: I want to know be assured that both my wife and I can CHOOSE when we want to retire.
Passive cash flow is the key to knowing that I have enough coming to sustain our lifestyle and maintain our assets. It also means that there is a legacy I can leave behind when I’m no longer around.
Timely: 30 years
Many things can happen in 30 years, but it does mean that I’ll have to unpack all this a bit more and set mini-milestones along the way to realise this big goal.
Don’t get me wrong – it’s perfectly fine to have other types of financial goals, e.g. have $X or own YY by age Z. I just prefer to focus on the cash flow rather than the assets that I’m looking to accumulate.
What are your financial goals?