In finance, and in life generally, there are steps and elevators.

Steps and elevators take us to where we want to go.

When it comes to money, eventually we want to wind up in a nice place. A paid home. A retirement fund. An opportunity to slow down and enjoy the fruits of our work. An opportunity to help others financially.

Money elevators are rare. You receive an inheritance, or win the lottery, or marry that rich person. Few people get to ride money elevators.

Most of us climb the steps. And the financial steps of our lives are called paychecks.

We normally are paid twice a month, or about 25 times a year.

Each decade has 250 paychecks.  250 steps.

Today you are here.  Tomorrow you want to wind up there.  How many steps are left?

This is why it is critical to know what “there” is in great detail. Because if you don’t know how much “there” costs, then you don’t know how much of today’s paycheck must be set aside for that goal.

When you know the price of the home you want paid in 20 years–in 500 steps–then you are informed about what you must do today.

Knowing where you want to be in the future informs you of what you must to do today.

But when you do not know where you want to wind up–when your goal is not specific–you wander. You try this and taste that. You go in circles.

Identify where you want to wind up being. Measure the paycheck steps left in your life. Make every step count.

The more steps you have left, the smaller each step is.

Paychecks are steps towards your future. Make every step count.


Image courtesy of Flickr and ~jar[]