Knowing what your passive income target is paramount to achieving success in your investment journey. What are you aiming for? What is your ultimate goal? There is very little hope of success for you if you do not have a central purpose, or definite goal for which to aim. If you don’t know what your target is you are unlikely to ever do anything because why would you? What would be the motivation to put in the time if you have no idea what you are trying to achieve, and no idea on when/if you’ve made it?
RUNNING AND FINANCIAL FREEDOM
For me, it’s similar to running. I do not like running. I’m not going to go outside and just start running with no purpose and no end destination or goal. However, I do go for runs because I have goals of staying healthy so that I can do things I love like climbing mountains. I know that in order to do a lot of the things in life that bring me fulfillment, I need to be in shape, and so I run. If it weren’t for those reasons, there is no way I would be going for runs multiple times a week and expending that much time and energy just for the sake of running.
It’s the same thing with achieving financial freedom. It is going to take effort, work, and a lot of time to get there. If you don’t have a end goal and big reason to achieve financial freedom, why would you ever put in the effort? Most likely you won’t. So if you haven’t read it yet, start with reading What Do You Really Want? – Find Your Why and spend some of time in self-reflection on that idea to find your why and your ideal lifestyle. When you have that pretty well figured out come back to this post.
YOUR WHY IS VITAL
To know your big WHY for achieving financial freedom is the strongest motivator that exists. It has to be a deep, personal reason. A goal of a flashy life of material possessions and “bling” is not a strong enough reason and if that is yours, then your motivation will fizzle quickly. You know at your core that won’t actually make you happy. It’s easy to think your dis-sastifaction in life would be solved by having more money, but there are just as many un-happy rich people as there are poor people. The reason is they aren’t living a fulfilled life. Happiness comes from living a fulfilled life, not having stuff. True wealth (and the reason for achieving financial freedom) is the ability to fully experience life.
Knowing what you really want in life and the lifestyle that would bring you the most satisfaction and joy in life is THE key first step. You have to know yourself and what really makes you tick. If you know that, you know what living a fulfilled life would look for you. And if you know what a fulfilled life would look like, you can calculate how much that lifestyle will cost you every month. Find that number and then you have your monthly passive income goal to live your ideal life. Then you have a solid goal to shoot for.
CALCULATING YOUR NUMBER
Here’s a calculator to help in finding your number. In the housing costs section make sure to include mortgage, property taxes, insurance, repairs, everything if you own your house.
Now that you know what you want in life and have your target passive income goal, you know exactly what you are shooting for… now go do it! Success begins in the will. The qualities one must possess to win are a definiteness of purpose, the knowledge of what you want, and a burning desire to possess it. By finding your why, you have the knowledge of what you want. Knowing your target number required to live fulfilled and financially free gives you definiteness of purpose. Hopefully envisioning your ideal life gives you a burning desire to possess it because it is achievable!
Goals are useless without action. Action is useless without goals. You have your goals, it’s time to take action!