I have written a lot about goal setting…this is just one more in that series! A few things I thought were important to Goal setting are:

1. Let the thoughts come freely when you are setting goals: do not restrict yourself to what you read on the net…these are only examples. Hence in this article I wish to give no examples. Sadly instead of increasing horizons, it restricts people from thinking. So feel free when you set your goals.

2. Goals for a community feeling: Your goals should be for YOU, but they should not be completely selfish. For example it is easy for a man to say ‘I will go the gym every day’ but for that it means his wife has to answer 8 door bells between 6 am and 7.15 am when she has to also prepare 2 kids for school, food for herself and YOU, listen to your mom’s request for breakfast and medicines…If you put such a strain on your eco system people will WANT your resolution to FAIL.

3. Big Hairy Goals: Bill Gates says goals should be big – like a 800 pound Gorilla…but also remember that goals should be achievable. If you set a goal saying ‘this i cannot achieve’ it is a poor beginning. So tough, but achievable goals should be the aim….

4. Be focused, track the goal closely and use the feedback to achieve it or Modify it. -better to achieve a modified goal rather than give up completely.

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  1. Subra Sir,
    Goal setting is very important aspect of any effort financial planning may being one. But I always have one query. Imagine if all of my goals are somewhere about 20 years down the time, do I still have to allot different financial slots for different goals. I mean if I want to invest thinking about my daughter’s marriage (20 years away) and my son’s education (20 years away), Do i still require to allot separately to different instruments of investment. I will want money to increase in the best possible way for both goals isn’t it? then why two different slots for the same capital appreciation required?
    Suppose with my research I construct a portfolio for capital appreciation which I believe is good then I shall apply the same for both goals, I will not want one slot of my money to grow less than the other slot isn’t it?
    Near the end of appreciation period I need to withdraw and then I can make switches, withdrawals slowly or shift some amount to less riskier instruments. But till then cant all the money grow unitedly instead of in different slots

    What am I missing here?
    Please enlighten me

  2. Dear Dr. Kishan,

    Firstly, please accept my congratulations on making the effort to think and plan ahead methodically for such long term goals.

    As to your query, yes you can pool your investments for different goals for ease of management.

    However, long term goals will typically have a many variables.
    The goals may come with different amounts and at a different time then originally planned.
    For example, neither you nor your daughter may be able to predict the year of wedding even 2-3 years prior to the wedding.

    There is a risk of using too much for one goal and leaving inadequate amount left for the other. Conversely, for a conservative person, there is a risk of limiting yourself to spending too little and sacrificing when it is not actually needed.

    Having separate kitties can also have other advantages:
    1.Different asset allocation:
    For example, many Indian weddings involve a large expense on gold (jewelry or otherwise). A good way to provide for the same would be to invest regularly in a gold etf. You may not wish to do the same for your son’s education portfolio.
    2.Financial responsibility lessons for your kids:
    You can make your kids financially aware and responsible by allowing them to make small contributions for their own goals. This could be from their pocket money and Diwali cash when they are young and perhaps from their salary if they are working part-time/fill-time before the goals are reached).
    This can go along way in their developing the right attitude towards money and help them throughout their lives.

    Hope this helps.

    All the best!

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