Why bucket list items are an important part of financial planning

Before Jim Carrey became one of the world’s best-known comic stars, he was an unknown actor, trying his best to make it in a notoriously unforgiving industry.

When asked about the secret to his success in an interview with Oprah, he revealed that setting himself big goals was crucial. When he first started out, he wrote himself a cheque for $10 million and dated it “1995”.

Although people thought he was being unrealistic and it was all a pipe dream, he carried that cheque around in his pocket for years. And in 1995, he found out that he would indeed earn $10 million for his starring role in Dumb and Dumber.

By setting his sights high and not compromising on the things he really wanted to achieve in life, he was able to stay motivated and eventually meet his goals.

It may be a good idea to take this approach to your financial plan and think about the big bucket list items that you have always dreamed of when you are setting goals for yourself.

Read on to learn why goals are such an important part of your financial plan and why your bucket list is a good place to start.

Having goals can help you save and invest more effectively

Setting goals is an important part of the financial planning process. Indeed, you will typically spend your first meeting with a financial planner discussing what your short-, medium- and long-term goals are.

This goals-based approach is crucial as research suggests you are more likely to adopt and maintain good financial habits if you have something to aim for.

A study from Stirling University, for example, found that people who set clear savings targets are more likely to successfully save money. Additionally, households with four or more savings goals owned twice as many shares as those with no savings goals. 

As such, people with definitive ambitions may be more likely to see their wealth grow over time because they make regular investments.

However, the type of goals that you set for yourself may be equally as important as setting objectives in the first place.

While some of your goals will likely be practical things such as paying off your mortgage, helping your children, or ensuring you have the right protection in place, it may be equally important to focus on more exciting bucket list items such as buying a holiday home, starting a business, or visiting far flung corners of the world.

If Jim Carrey only set himself the goal of appearing in an advert so he could afford to pay his rent that month, he may not have been quite as driven as he was and may never have found the success that he did.

Financial stability is the most popular retirement goal, but it doesn’t get people excited

People have a wide range of objectives in retirement, and it is important to most that they are comfortable and do not have to worry about their finances.

In fact, according to Legal & General, 94% of people said their main goal in retirement was to be financially stable.

The same survey also found: 

  • 81% said being able to afford care was a priority
  • 73% said that funding family events like weddings was important
  • 69% said supporting their family financially was a priority.

These are all relatively practical aims and many of them are associated with being stable and avoiding financial difficulty.

However, when asked which goals in retirement they were most looking forward to, the respondents of the survey answered differently – 52% said travelling, 38% said spending more time on hobbies, and 28% said home renovations.

The results of this survey demonstrate that it is often those bucket list items like travelling and taking up new hobbies that get people excited about their financial plan, not the percentage growth they may see on their investments each year.

People invest in experiences

If you want your financial plan to work for you, you may need to change your mindset towards your wealth.

Consider it a means to achieving the things you value in life. The primary reason to invest and grow your wealth is so that you can draw an income and use it to pursue experiences that are important to you.

So, you don’t necessarily need to consider which strategy will generate the most growth. Instead, determine which strategy will help you achieve your big goals in life, whatever they may be.

It could be buying a holiday home, going skydiving, or simply spending time with family. Those experiences should be at the centre of your financial plan and everything else you do is simply a means to achieving those things.

By shifting your mindset in this way, financial planning may become far more engaging, and that could make it easier to maintain positive financial habits.

How to set bucket list goals for your financial plan

1. List your priorities

Listing your priorities in life is a good place to start if you are unsure about specific goals. For example, you may have spending time with family and travelling at the top of your list. 

In that case, perhaps investing in a holiday home where you can go with family may be a suitable goal?

2. Be honest

When Jim Carrey wrote that $10 million cheque, there were likely those who laughed at him. People are often afraid to be honest about their dreams for this reason because they don’t think that others will take them seriously.

However, it is important that you don’t let this get in the way. Be honest about what you want in life, no matter how unrealistic it may seem. You will often find that you are able to achieve those goals with the right financial plan.

3. Use those goals to direct your financial plan

Once you have a bucket list, you can use those goals to direct the rest of your financial plan. When you work with your financial planner, they can help you determine what level of income or savings you may need to achieve those dreams and use that as your target.

They may also be able to use methods like cashflow planning to help you forecast how much you need to save and how the value of your investments could grow over time. This helps you ensure that you are on track to tick those items off your bucket list.

Get in touch

If you want to explore some of the different ways we may be able to help you achieve your bucket list items, get in touch today.

Please contact us at hello@ardentuk.com or call 01904 655 330. As an award-winning financial advice company that was a 2022 VouchedFor Top-Rated firm, you can be sure that we’re a bona fide company providing excellent advice and high-quality service.

Please note

This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.

The value of your investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance. Investments should be considered over the longer term and should fit in with your overall attitude to risk and financial circumstances. 

The Financial Conduct Authority does not regulate cashflow planning.

Get in touch

By talking about your current situation and listening to your aims, we create a personalised plan that will put you on a path to achieving your aspirations.

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