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Everyone has financial goals. A new home. A dream vacation. A comfortable retirement. Starting a business.  Dreams are infinite, your money is not. 

Often we ask our money to do too much. We try to divide very limited resources across too many priorities. Then we end up making very little progress on any of them. 

That is what I mean by making your money “do the most”.

I want to go a little deep on how we can end up overworking our money, how it negatively affects our ability to achieve our goals, and how we might be able to avoid the trap. 

What do I mean by overworking our money?  

For me, overworking our money is asking our money to do way more than it can realistically accomplish. It is taking the extra $100 we may have been able to eke out and ask it to contribute to our goal of going on a dream vacation, a new car downpayment, and a mortgage downpayment. Now, every cent of our money can eventually contribute towards achieving our goals. It becomes a problem when we run the actual math and realise that our goal might take 70 years to achieve. While there is no harm in dreaming big and planning for the long game, we have to make sure we are planning realistically. 

Why doing the most with our financial planning might be hurting our long-term goals?

The effects of being unrealistic with our financial planning hurt us from two angles:

Actual outcomes – I mentioned before that asking our money to stretch way beyond where it can reach means that we might be looking at some goals taking decades to achieve. It also means that more achievable goals might be delayed unnecessarily because we were prioritising without being practical. Some examples might be: 

• Maybe we have some overdue loans that are accruing late fees or increasing interest but we know we really want to buy a house in 10 years, so we decided to focus our efforts on saving towards the house downpayment instead of getting the burden of the loan out of our hair.
• Maybe you take your savings budget of $100 and divide it up equally. 20% each going towards retirement savings, car downpayment, house downpayment, emergency fund, and education fund. But, you are 20 years old. The reality is that investing in the right education or learning today would likely increase your earning potential. You can invest in everything else on your list, but maybe not equally. Why? Because at this stage in your life, all of those things should not be given equal priority. 

I can go on and on with examples because each individual, each circumstance is unique and I am sure I could create a story for each one of them. But, you get the drift.  

Psychologically – Over time repeated failure to hit financial milestones erode self-confidence in your financial planning ability. Saving starts to feel pointless, budgeting feels restrictive, and overall financial planning feels discouraging instead of inspiring. 

Even the best financial planners get hit with setbacks. No plan goes perfectly, and things will happen to derail us. But, the difference between those that are successful with their financial goals and those that don’t is how they react.

How to avoid doing the most?

Avoiding doing the most takes realistic planning and realistic planning requires information.  Nothing complex or major, but we need a little data and math. Let’s go through a mini exercise. 

1. Write down your goals and the target timeline. 
2. Estimate the cost of each goal. 
3. Decide which goals matter most right now. 
4. Calculate how much you need to save each month.
5. Compare that number to what you can realistically afford.
6. If the money cannot meet the goal, adjust the goal to meet your money. 

Use this to set your monthly budget and really push yourself to stick with it as much as possible. 

Two important points on financial goal setting: 

1. A dollar can only be spent once. That dollar cannot simultaneously fund your emergency fund, home downpayment, education, vacation plans, and your retirement fund. Your goal cannot just be “to save”. Every dollar has to be assigned to one goal, and once assigned it becomes unavailable to another. 
2. Everyone’s priorities are different, because everyone’s life circumstances are different. Use your self-awareness to drive your financial prioritisation. 

The objective when it comes to your financial planning has to be to put your money, and yourself, to work towards achieving your goal. However, you cannot ask your money to do the impossible. The idea is to be as transparent and realistic as possible on what your money can do, and then work within that parameter. 

Before setting another financial goal, take a second and as yourself: can my current resources realistically support this priority?”. If after you assess it, the answer is no, the goal doesn’t have to disappear – it might just need to go elsewhere on your list, get a different priority level, or another goal needs to drop. 

Financial success is not about asking your money to do more. It is about helping your money do the right thing at the right time. 

If you need help teasing out those priorities, let us have a conversation.