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Meet Your Financial Objectives: Goals vs. Restrictions

I have this coffee habit.

I love the stuff. I love that caffeine rush I get in the morning from a steaming cup of joe.

I’ve gone on and off caffeine so many times in my adult life, I’ve lost count. Sure, caffeine isn’t great for you, but coffee beans are jam packed with tons of antioxidants (at least, that’s my rationalization).

So when I first got hooked on the stuff, I was going to pricey coffee shops 4 and 5 days a week. Eventually, I wised up and realized that at almost $5 a pop, this habit couldn’t last forever. So, I quit visiting the coffee shops and created my own little coffee shop at home with a $20 coffee maker.

With just that $20 purchase, I kicked my coffee shop habit. The solution may seem simple, but it doesn’t work for everyone. (That much is clear by the rising popularity of the coffee shop business and on-the-go lattes.)

Goals vs. Restrictions

In most situations, there are two ways to reach the goals you set for yourself:

  • Setting milestones to reach for (make coffee at home) or
  • Placing restrictions on yourself (don’t visit the coffee shop anymore)

If you step back and look at these two types of goal-reaching techniques, the difference is pretty clear: one is a positive approach and one is a negative approach.

When you create stepping stones in order to reach your goals (like making coffee at home), it comes with a positive correlation. Instead of taking something away from yourself, you add small goals to your plan so you’re always progressing forward in order to meet an objective.

On the other hand, going from visiting the local java hut every day to never visiting it again can be quite a buzz kill. It may seem feasible at first, but after awhile, such an extreme restriction can seem daunting and impossible. If you start to drastically restrict things in your life that you’re accustomed to, it may backfire and cause you to overspend on the days you are allowed to spend.

Find What Works for You

However, setting up boundaries and/or restrictions can actually work better for some people.

Financial goal-setting is a pretty personal matter. What works for one person might not work at all for the next person. So when you’re setting out to reach all of your financial dreams, ask yourself if you work best under restrictions or by accomplishing a task at hand.

It might even be a good idea to experiment with a combination of techniques. If you want to cut out the $4 lattes, maybe you could purchase your own coffee maker, but still allow yourself 3 or 4 store-bought lattes per month. That way, you’re still able to splurge on one of your favorite treats, but overall you’ll be saving money by making coffee at home 90% of the time.

Then Track It

No matter which technique you decide to use, it’s always important to track your progress.

It doesn’t matter if restriction or goal-attainment works better for you; seeing your progress in the big picture can be quite motivating—especially when you’ve been working on your financial fitness for a long period of time. Things can become repetitive and ho-hum after awhile. But, if you keep seeing results, chances are good that you’ll keep moving forward towards your financial dreams.

After a month of home-brewing your own coffee (or whatever your task at hand is), take a step back and see how far you’ve come. If you’ve only visited the coffee shop 5 times that month, it will be clear that you’ve made a lot of progress.

So next time you set out to better your finances, try playing around with your goal-meeting techniques. If you’re used to restricting things to meet objectives, try adding small goals to achieve instead. It may be just the change you need to reach your financial dreams.

What about you? What kinds of goals and/or restrictions have helped you meet financial (or other) goals?

Published or updated on July 13, 2010

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About Amber Gilstrap

Amber is a twenty-something CPA from Kansas City, Missouri who loves writing, working out, and---of course---finding fresh ideas for saving money. Follow her on twitter @amberinks.


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  1. Wayne says:


    very good post. I would offer just two points based upon my professional goal setting experience:

    a) All/any goals should be looked both at long/short term goal planning. Obviously for the senior soon to be college grad who wants the red BMW, is a nice “want” but is is realistic. Probably not because the soon to be grad has got to get a job first and foremost. The point is to break down all your goals into short/term blocks of time.

    Secondly, as you indicated, you need to be able to check your progress. With your caffeine example above, maybe the money you would have sepnt on Joe/lattes could be better utilized in paying more on outstanding loans you already have or to put those dollars in a savings account/investment account. Then track and check your progress.

    The money you are now saving will be the motivation you need to continue in achieving your financial goals.



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