When I started working at BNR and then Nortel there was always a “goal” for the company, and one of the most interesting goals was Vision 2000. This goal was that Nortel was going to be the #1 Telephone equipment sales company in the world, and (I think) Nortel achieved that Goal, however, by the time that 2000 rolled around, the Goal no Longer mattered. The business of selling phone switches was circumvented by the Internet and Wireless phones and how all this worked together.
This is why it is very important that you set your Financial Goals, but you also every once in a while do a “sanity check” on the Goals themselves to measure whether they are still relevant.
Say you had children and you had a plan with RESPs and such, but then your child was diagnosed with a disability? Suddenly your goals may no longer be relevant, however, you can change them and react to the change in life that has happened to your child and to your financial plan. This happened to me, although I am not quite sure what my financial plan was then, it now includes an RDSP and saving for my child’s future as a disabled Canadian.
If you suddenly got a windfall of money from an inheritance or a bonus, it is obvious that your plans are no longer up to snuff (unless you planned for that, in which case, good planning!). When you end up “in the money”, don’t just squander it and then have to make up other plans (like what to do when you are out of bankruptcy), rethink and re-jig your plans or expand your goals.
If one of your goals was to have $2 Million saved for your retirement by age 55 (a good goal, in my opinion), however, over time you have also built up a substantial amount of discretionary debt, which will not be paid off by the time you reach age 55, your retirement savings Goal is now irrelevant. If you reach your goal of having $2 Million in savings, yet you are carrying $300,000 in mortgage and debt by that age, your goal has not really been achieved has it? Stop saving, kill the debt and then get back to your plan.
All plans need to be tended often to ensure you are chasing the right brass ring, or ensuring that the brass ring is still there and that you still want to have it.