{"id":6663,"date":"2019-12-30T13:55:17","date_gmt":"2019-12-30T13:55:17","guid":{"rendered":"https:\/\/www.foxymonkey.com\/?p=6663"},"modified":"2019-12-30T13:55:18","modified_gmt":"2019-12-30T13:55:18","slug":"gemfinder-q4-2019","status":"publish","type":"post","link":"https:\/\/www.foxymonkey.com\/gemfinder-q4-2019\/","title":{"rendered":"Gemfinder Q4 2019 – Goals & Promises"},"content":{"rendered":"\n

The Gemfinder is a collection of articles, books, videos and podcasts that I find interesting. The content is published every quarter and it\u2019s evergreen. This means that at any point in time you can go back and read all previous\u00a0<\/em>gemfinder<\/em><\/a>\u00a0articles without missing out on \u2018recency\u2019.\u00a0<\/em><\/p>\n\n\n\n

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If I\u2019m certain about a single thing in this life is the new year resolutions. <\/p>\n\n\n\n

It\u2019s this time of the year people define new goals and reflect on what they achieved so far. I\u2019m sure you\u2019ve noticed some repeatable patterns: This year I will lose weight, I will start running, I will save \u00a3X,000, turn my idea into a business etc. etc.<\/p>\n\n\n\n

It\u2019s no wonder gyms make most of their profits in January. It\u2019s also no surprise that gyms gain the most out of people who pay for a year and never visit past February. I\u2019m guilty too. Why is that, though?<\/p>\n\n\n\n

It\u2019s because people are so good at defining goals<\/em> but fail miserably to support those goals with systems<\/em>. If this rings a bell, it\u2019s the gist of the excellent book Atomic Habits. I listened to it<\/a> recently.<\/p>\n\n\n\n

Goals are about the results<\/strong> you want to achieve. Systems are about the processes<\/strong> that lead to those results.<\/p><\/blockquote>\n\n\n\n

The idea is really simple.\u00a0Most of the goals fail because we either achieve them or not. It\u2019s a binary result. Even if we achieve a goal, say lose 10kg in 3 months, we won\u2019t carry on being on this diet and on a healthy lifestyle. This only makes us regain weight quicker than we lost it.<\/p>\n\n\n\n

Coming to personal finance, the idea that we want to save \u00a310,000 by summertime is just a goal. But to achieve it, we need to build a mechanism that makes this easy for us. A system. For example, we could set up a standing order the day we\u2019re paid to automatically transfer money to our ISA or savings account. This way, if we focus on the system, the goal will take care of itself.<\/strong> <\/p>\n\n\n\n

To make things even better, we will be keeping the system for a long time, instead of asking \u201cWhat\u2019s next\u201d after achieving (or failing) our goal. <\/p>\n\n\n\n

The key to building systems is to make it as easy as possible to do so. We will invest prudently if there\u2019s already a system in place to do that for us. Automatic transfer into a savings account -> automatic ISA top-up -> automatic investing into pre-selected funds.<\/p>\n\n\n\n

Leave the lump sum up to me one month and I may invest in Value funds because growth stocks have greatly outperformed value the past 10 years. In fact, I just did that<\/em>.<\/p>\n\n\n\n

Don\u2019t get me wrong, having goals is great. But building systems is the real deal.<\/p>\n\n\n\n

Foxy Monkey January 2020 Meetup<\/h3>\n\n\n\n
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