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Arta Guest Spotlight

How to Set Up Your Mindset for Financial Success in 2024

Arta Guest Spotlight

February 09, 2024

By Brandon Bouier, Arta Founding Member, and author of Money Mondays and Day 2 Investing

Welcome to 2024!

With a new year comes new possibilities - and sometimes new stresses. One of the most common stressors is money, which is why most New Year’s resolutions are financially oriented. If you have financial goals of your own, let’s discuss ways that you can optimize your mindset to make 2024 the year of financial success.

Step 1: Define your “Why”

Start with a dream: Our lives are fueled by dreams, but simply wishing isn't enough. Dreams transform into actionable goals when we define them with specificity and timeline. This bridge between dream and goal is crucial, especially in a world driven by finance. Whether it's retiring on a porch swing or exploring new culinary havens each year, every dream requires capital to manifest.

From dream to goal: By defining specific timelines, milestones, and resources needed for each dream, we transform them into tangible objectives. This shift from vague aspirations to concrete plans is the bridge between wishing and achieving. For example, instead of simply dreaming of losing weight, set a goal to lose 10 pounds by June 30th, outlining a workout and diet plan to get there.

The importance of goals: This is the personal part of personal finance; these goals are unique to each person and serve as the foundation of a person’s financial journey. Goal setting is the first (and arguably most important) step we need to take as we begin that journey. These goals are your Why - think of them as financial decisions. Regularly revisiting and updating these goals ensures they remain aligned with your evolving aspirations and keeps your journey through life focused on what truly matters.

Step 2: Get a reality check

Honestly self-reflect: Start your journey by facing reality head-on. Assess your current financial standing, spending habits, and income streams. Acknowledge how you got here, but don't dwell on blame. This is simply the foundation upon which you'll build your future. Remember, your past doesn't define you; it's the choices you make now that will determine your trajectory.

Embrace responsibility: Take ownership of your financial situation. Remember, in this journey, excuses are cobblestones that pave the road to nowhere. Understand that regardless of external factors, you hold the power to change it. This doesn't mean blaming yourself, but recognizing that you are the captain of your own financial ship. Choose to be the driver, not the passenger. This empowered mindset is the first step towards building wealth and achieving financial independence.

Discipline is the price of success: The road to financial freedom requires dedication and sacrifice. Understand that your desired lifestyle - becoming financially independent and building generational wealth - demands a higher level of discipline than most. Be prepared to make tough choices, prioritize long-term goals over fleeting desires, and commit to consistent action. As the quote says, "If you want success, figure out the price you have to pay, then pay it." Invest your time, energy, and resources wisely, and watch your financial dreams materialize.

Remember, this journey is about progress, not perfection. There will be stumbles and setbacks, but with honest reflection, a firm grip on responsibility, and unwavering discipline, you can achieve anything you set your mind to. Take the reins of your financial future and embark on the rewarding path toward lasting prosperity.

Step 3: Ignore the noise

Dismiss the hype: In the constant churn of news, it's easy to get swept away by the latest political upheaval or economic tremor. Every “BREAKING NEWS” headline screams impending doom, urging us to react. But before you let the crisis du jour hijack your financial plans, take a breath. The reality is that short-term events rarely play out as dramatically as the headlines predict, and fixating on them can be dangerous to your wealth.

Remember, events can have a fleeting impact: Take last year's recession fear-mongering, for example. Pundits painted a bleak picture of collapsing markets and economic ruin, fueled by the Fed's aggressive rate hikes. Yet, against all predictions, the market surprised everyone. The S&P 500 surged 24%, and the Nasdaq jumped 44%, leaving the pessimists in the dust. This isn't an anomaly. While world events undoubtedly impact the market, their influence is often overstated and short-lived. History shows that markets recover, adapt, and ultimately climb higher, regardless of temporary turbulence.

Sometimes the market goes down...

Year

Event

S&P 500 Return

1941

Pearl Harbor

-17.86%

1953

Russia tests H-Bomb

-6.62%

1962

Cuban Missile Crisis

-11.81%

1973

Mideast Oil Crisis

-17.37%

2001

9 / 11

-13.04%

2002

Threat of war with Iraq

-23.37%

2008

Global Financial Crisis

-38.49%

source: https://www.macrotrends.net/2526/sp-500-historical-annual-returns

...And sometimes it goes up

Year

Event

S&P 500 Return

1945

Death of Roosevelt

30.72%

1949

Russia tests A-Bomb

10.26%

1963

Kennedy Assassinated

18.89%

1968

MLK & Kennedy Assassinated

7.66%

1999

Y2K

19.53%

2009

Swine Flu Pandemic

23.45%

2020

COVID-19 Pandemic

16.26%

source: https://www.macrotrends.net/2526/sp-500-historical-annual-returns Take a step back: The next time you feel overwhelmed by the cacophony of financial news, remember: don't let the headlines dictate your wallet. Stick to your Whys, fact-check, and avoid impulse decisions based on fleeting anxieties. The market has weathered countless storms before, and it will weather this one too. Stay calm and trust the long game. The odds are heavily in your favor. Happy New Year to everyone! May you end the year wiser and wealthier than you began.

About Brandon Bouier

Brandon is a founder and moderator of the Day 2 Investing community and authors its weekly Money Monday newsletter, reaching over 10,000 technology professionals with investing and personal finance insights. He hosts a bi-monthly AMA with his colleagues at Google, dedicated to the mission of sharing peer-to-peer financial insights and spreading grassroots financial literacy with those around him. Brandon is also a Manager at Google Cloud Consulting. Connect with him on LinkedIn.


Got some learning that you think the rest of the Arta community could benefit from? Reach out to us at membership@artafinance.com and we'd be happy to talk with you about a guest post or AMA!


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