While I was posting Deficit Unplugged, our President was compromising with Republican Leadership to create Deficit Ignored.  Should we have a payroll tax holiday?…yes we should.  Those tax cuts?  They should have gone the way of the DoDo.

Here is, honestly, why I am concerned about the deficit.  As a Nation we have promises to keep.  We have the promise to our citizenry that if you work hard and use your mind, you can have a better life than your parents, in other words, we have a promise of upward mobility, yet our middle class is shrinking.  For the last 75 years we have promised everyone who works that they, and in some cases their dependents, will have a safety net in old age and for the last 35 years we have promised elders some semblance of health care.

There is a risk now that all the promises will be as ashes.  In truth the giveaways that I talked about in Adult Conversation are part of the problem.  In order to make Social Security more appealing benefits increased and the retirement age was lowered even as the population began to see increases in  longevity.  In order to avoid fiscal responsibility, Social Security receipts were spent as part of the general budget.  When borrowing from ourselves wasn’t enough, we borrowed from other nations.

Engineering short term budget deficits will never allow us to attack the long term budgetary issues that affect our fiscal health.  We had a chance to let the tax cuts expire but now that ultimate decision has been kicked two years down the road.  Our tax code is a mess, to be sure: it is over 67,000 pages of nonsense and exceptions to nonsense. TAX prep is a 65 Billion dollar industry and roughly 61% of filers use a tax prep service.  Refund Anticipation Loans are a huge business in low income areas.  I have lost count of the number of articles I’ve read by economists over the past few weeks who advocate reforming the tax code, collapsing to two brackets, the top of which would be lower than the top bracket under the beloved Bush cuts, and adding a value added tax.  Taxing both production and consumption rather than production as we solely do now.  Some of the logic for not doing these things boggles the mind:  A value added tax would cause the poor to save rather than spend so we shouldn’t do it…huh???  We should preferentially tax the rich because the rich would save rather than spend….huh???  We should extend unemployment benefits because the unemployed will spend them….huh???

Since the 1970s the roots of our economy changed from a manufacturing base to a consumer base, an economy driven by spending.  What did George W. Bush urge us to do after 911? He urged us to remember our patriotic duty and shop.  But there is a problem with jobs based on retail and consumer spending and that problem was summed up by Lee Scott, CEO of Wal Mart:  “Some well-meaning critics believe that Wal-Mart stores today, because of our size, should, in fact, play the role that it is believed  General Motors played after  World War II.  And this is to establish this post-world war middle class that the country is so proud of.  The facts are that retail does not perform that role in this economy.”

Our economy has become dependent on people spending and when they run out of their own money to spend, borrowing to spend more.  No wonder we are in the mess we are in.  We have become a nation of “business as usual” trying to hang on to what it has rather than pave the way forward  with programs and incentives that will restore our middle class.  I actually believed that there would be a push for updated infrastructure and a new power grid.  It kills me that a chunk of my money every month is recycled back to the very extremist groups responsible for 911.

What do I think the President should have done?  How about lock everyone in a room with the camera’s rolling rather than hammer out an agreement after hours behind closed doors?  Make people responsible for their positions in public, not when surrounded by the safety of the herd as most politicians are when they make statements about the economy.  He should be in my face all day every day articulating his views.  That 70 minute internet only version of Mr. Obama’s 60 Minute interview was a revelation.  He has sound positions but is not doing a great job of communicating them.

I am not someone that my mother would call liberal; my mother occasionally calls me Neal (for Neal Bortz and she has even called me a selfish capitalist on my own blog)…I don’t believe in using the tax code to redistribute wealth, and I believe that everyone must pay.  I believe in term limits to certain safety nets like unemployment insurance coupled with sound public policy like a jobs bank and retraining.  By jobs bank, I don’t mean a jobs bank that the automakers had in which laid off workers were paid substantial incomes while at home waiting to be called back to automotive jobs.  No, what I mean is a database of jobs and industry trends so that people don’t have to guess what industries are fading and which ones are emerging, they don’t have to guess what the qualifications for any given job are, opening and closing dates for applications are posted and adhered to, resources for retraining are promulgated and there is funding for retraining. I believe in a national infrastructure bank with national priorities that are updated and funded and I don’t believe that public works projects should be awarded to  certain companies without the benefit of competitive bidding.

What we have now is a mess.  And political will only to posture rather than fix our problems.

I am afraid that the scenario that I outlined in Adult Conversation will take place.  I believe that Americans will ultimately have to forgive the intra-governmental debt Social Security now holds and Americans will have to accept less.  You avoid the iceberg when the tip is just a speck on the horizon, not when the berg is looming  off the bow.

By kicking the can down the road as our leaders just did this week we are surely headed for tougher choices down the road.

Please comment.

Okay so like I’m middle aged.  I think middle aged people tend to conduct their affairs in pretty much the same way.  Middle aged people tend to reflect on their lives and decide ultimately that people, more than things, are important.  I know that is true for me and I think is the reason why the fastest growing demographic on Facebook are people in middle age.  We are trying to recover those connections that we lost on the road to getting somewhere.  Middle aged people have acquired all the things they want or have adjusted their wants not to want so much and start to clear the clutter from their lives.  A few years ago my home flooded.  I was racing about the house trying to save things that were doing their best to die a water-logged death.  I realized then that I had way too many things.  A friend remarked as she viewed my personal possessions strewn about the back yard to dry, that my yard looked like the Sanford and Son junk yard. I began to de-clutter then out of necessity, but clutter is the natural state of our lives and de-cluttering requires conscious living and constant vigilence. Middle aged people also tend to become more frugal.  Retirement is just around the corner and we have to think about that.  A friend of mine recently told me about a trip out with his wife.  She wanted to go out for a burger.  He checked the fridge to see if they had the ingredients to make a burger at home.  They did not. Realizing that they would have to eat out, my friend grabbed a slice of American Cheese and put it in his breast pocket. He wanted to save the cost of the cheese for the cheeseburger.  My same friend enjoys a glass of wine with dinner.  The problem is that drinks with a meal can increase the tab by 30% to 50% and the mark up on beverages is routinely 300%.  So his solution is to bring his own wine and have a glass in the parking lot before going into the restaurant. While I don’t port my own cheese and wine, there are things that I do to save money.  All of my friends enjoy life,  time with their families,and  sharing the occasional meal out and traveling, what we all have in common is the desire to plug the crazy money leaks that can keep us from doing those very things.  I use online banking to save both time and money.  If you use online banking the customer service division at your bank is at your disposal should a payment go missing. Years ago I would have to wait for a check to clear then obtain a copy of that check to prove that I made a payment  No so with online banking, they have an electronic trail and they will make contact with your “payees” should your payment go missing.  I recently had an experience in which my bank caught one of my service providers holding a payment until it generated a late fee before crediting my account.  I ditched that service provider and got a cheaper plan with a competitor. I canceled my cable/dish subscription.  Most households spend over a thousand bucks a year on those subscription services.  You would have to become a zombie in front of the TV in order to get enough “value” to justify that cost.  I watch TV on the Internet instead.  Fewer commercials, less time to watch each show and I only watch what I want to watch when I want to watch it.  I reuse ziploc bags and aluminum foil.  As a result I only buy those items once a year.  I buy Amway SA8 laundry detergent.  It is super concentrated, eco-friendly, hypoallergenic, dissolves completely in the wash, gets my clothes clean and I only have to buy it once a year. Even though rates of return for savings are ghastly at all banks, I use virtual banks for my savings.  They offer higher rates and are FDIC insured.  I use a frequent flier credit card for charges I would make anyway, utilities, groceries and gas, and redeem the points for flights.   Since 2005 I have saved $1000 per year in air fare.  I negotiate big ticket items.  My money is very patient, I don’t have to spend it right away and, as a result, before making a purchase I ask, “can you do any better?” If I am shopping online and find an item I like, I always Google that item to see if I can find it cheaper. I almost always can.  I keep a “most wanted” list to curb impulse buying.  I am storing my DVDs and CDs in iTunes so that I can donate the hard copies and continue to de-clutter my life.  We have a garden and eat at home.  We go out maybe 4 times a month.  I don’t slavishly shop at Wal-Mart assuming I am getting the best quality for the deal.   I shop at Wal-Mart, Safeway and the local food co-op.  I had an electrician install a digital, programmable thermostat.  It has saved 20% on my heating costs.  I hire professionals to do work that I have either no business doing or work that isn’t in my best interest to do.  I am a big “do it your selfer”. But being a DIYer can put you in a time and financial hole as deep and as wide as the Grand Canyon (okay that is hyperbole but you get the point).  The trick is to figure out the tasks I should do and the ones I should not do.  Let’s go back to the thermostat.  I had it for 6 months before it was finally installed.  The instructions and the wiring that went with it were very complicated and carried dire warnings that a wiring mistake could result in furnace damage.  I added the installation onto a planned project that required an electrician, the thermostat got installed and I am saving money which wouldn’t have been the case if I had clung to my DIY tendencies.

I would love to know about those cheap things you do!

Please comment.

One of the questions I ponder often is what makes one person different from another in terms of what they achieve.  The biblical parable of the sower talks about good seed that falls on rocky soil, seed that is stolen by birds and seed that takes root yet has different yields.  All of it is good seed yet some yields 10, 50 or 100 fold.  In other words the same good seed in good soil has different yields.  Why?  Perhaps his is a question best answered by the wisest sage.  So despite the fact that I constantly ponder this question, I’ll take it down a notch and apply the question to gardening, personal finance and task completion.

Why do some people complete their tasks online while others are late?  Why do some gardeners lose their plants to common pests like aphids and wind burn while others do not?  Why are some people plagued by late fees while others are not?

The answer lies in what you value and in the concept of routine. If you value the timely completion of tasks what do you do to make sure that happens? If you hate late fees, what do you do to make sure you never get one? If you love gardening, what do you do to make sure that your garden thrives and that you are not spending hundreds of dollars every year replacing dead plants?

The answer is routine. You develop a routine to make sure that your garden thrives, that your bills are paid on time, that your work is completed on time.  I have a great garden.  I love it and it has taken years to create.  In the fall, I winterize it.  In the spring I trim the previous year’s dead matter from the perennials.  I placed a drip irrigation system as the garden was going in so that I could water systematically with the turn of a knob rather than drag hoses all over the yard each time I watered.  I have tried very hard to systematize everything to make maintenance convenient.  Every morning in season when I have my coffee, I patrol the garden looking for pests and sign of sun and wind damage.  I perform the same task in the evening.  Walking through my garden during the growing season twice a day has become part of my daily routine.  Over the years certain tasks have become much less fun than others therefore I have learned to farm those tasks out, because having a thriving garden has remained a value to me.

Some might argue that I take the matter of routine a bit too far.  A friend of ours owns a nursery and greenhouse.  Like a phoenix from the ashes this garden paradise arose from an asphalt parking lot and a foreclosed upon Mexican restaurant.  I have a routine whenever I go there.  I go first to the grapevine and then to the honeysuckle. I have 3 shrub varieties and 3 vine varieties that I was introduced to at this green house.  I inspect.  What did I find today?  Aphids galore on the golden flame honeysuckle.  I told the owner who was grateful, but already knew determined to let the ladybugs do their job, eventually.  We both laughed agreeing that there was probably a program for me.  Then I remembered the orchid that I brought home only to find aphids on it picked up from the greenhouse where I bought it.  I’ll take my routine and philosophy any day rather than surrender my efforts to the devouring pests of aphids, late charges, over drafts and the like.

I took a sales class a few years ago.  The instructor had us do a painful exercise all on our honor of course.  Each night that we failed to make sales calls, we were to take a dollar from our wallets and burn it.  Just the thought of the exercise gave me palpitations.  Late fees provoke the same feeling in me.  Paying a late fee is literally a waste and does not enhance the value of the product purchased.  Paying a late fee on your mortgage doesn’t increase the value of your home and paying a late fee on your rent does not mean your landlord is going to reward you by putting in a new pool or laundry services.  Late fees are literally money up in smoke or money down the toilet.  They represent a waste and poor money management skills.  Anyone with a telephone, ATM card or access to a personal computer can pay their bills on time.  So if it is of value to avoid the fees it is easy to establish a routine around paying the bills on time.  Simply logging in, calling in or going to the ATM machine can be done on any schedule to make sure late fees never occur.

The same is true with task completion. If the desire is to write, then write a page on something every day.  If your boss has a project for you figure out how long it will take to complete and establish a routine around task completion until it is done.

I have become convinced that the reason some individuals are more productive than others is that the more productive ones have established routines geared toward what they value and ultimately toward higher production.

We have a choice, to maintain our homes through routine or risk coming home to a flooded house because we forgot to swap out the old hoses to the washing machine for new ones.  We can paint siding each year or have the sun blister and warp it until it needs to be replaced.  We can develop the routine of saving when we are 20 or 30 or go into panic mode at age 52.  There are so many things that we can do to unleash the power of routine in our lives.

Please comment. What are the things that have made a difference for you?

Adam Baker’s Man versus Debt is one of the blogs that I follow.  This post was inspired in some ways by Adam’s April 27th post When to Quit Traveling. Adam at the age of 24 or so, didn’t like the way his life was going accumulating things and personal debt so he and his family decided to sell their possessions and travel for a year.  They decided to cut their trip short by a couple of months and return home.  Adam discusses the implications of that decision on their present and future realities on his blog.

I am middle-aged.  I don’t say that like it is a medical diagnosis with all the emotional impact that medical diagnoses can have.  I say that at a statement of fact.  I am middle-aged.  I have also had a long and rewarding professional career and I have gotten to a point where I can see beyond my career to other opportunities.  Honestly, going to school for years and training to become something, in my case a doctor, can make you feel that you always have to be that thing you trained to become or practice that thing you trained to do the same way you have always done, but you don’t.  You always have the right to change your mind no matter how crazy every one around you may think that you are.

I have taken enough personal development classes to know that bringing about an even slightly different reality than the one I currently enjoy will require a great deal more than wishing.  It will require beginning with the end in mind.  The first time I heard the catchy phrase “you plan your life first by beginning with the end in mind”. I thought what kind of BS is this?!  Personal development programs always use the example of travel.  We plan trips toward a specific destination and, although there may be many ways to reach that destination, we always settle on a specific route.  The problem is that travel is easy and life can be a bit more challenging.

In the additional years of living since I first heard that phrase I now understand what that phrase truly means.  I will never reach a destination without first setting that destination as specifically as I know how. I then have to reject the things that prevent me from reaching that destination.  Wow, that sounds kind of harsh but ultimately that is really true.  If I know that in 10 years I want to be a person who owns 10 investment properties and that those properties will require a down payment of $20,000 each, I will have to engage in behaviors today that enable me to develop the requisite funds.  That will certainly mean saving money, it might mean networking to find like-minded business partners, it will also mean controlling day-to-day expenses as well as large purchases to make sure that I have the funds on hand that I need to buy the investment properties.

The toughest thing about beginning with the end in mind is deciding what that end is, deciding what I want my life to look like in all areas.  If I make one decision will that close off other opportunities?  Probably, but life teaches that a decision will also create opportunities.  There is a whole multi-million dollar  industry called personal development and life visioning to help people decide what they want illustrating that this is the toughest part of the life change process.  What if I make a decision and fail in the attempt?  I have to ask myself what is the worst that could possibly happen and can I survive that?  Yep, fear of lost opportunities and fear of failure are probably the two reasons people find it hard to decide what they truly want and therefore find it hard to make change.  I know that is surely the case for me.

Looking back, I found it relatively easy to be where I am today.  I certainly worked and worked hard and there were times that I felt quite alone. Looking forward feels a bit different because there is a certain level of complacency.  I really don’t have to do anything different and, except for the stirring in my heart, I would make no change at all.  Fortunately I am into listening to my heart these days.

First step?  Begin with the end in mind.  Quite fortunately in life we can have several beginnings.  Thank God for yellow note pads!

Are you beginning with the end in mind?

Please comment.

Tribbles are cute, fuzzy creatures as are goals in the sense that they create the warm fuzzies when you set one.

Tribbles reproduce like bunny rabbits as do goals.  Set one goal and pretty soon you are  drowning in a sea of goals unsure which one to tackle next.

Tribbles produce a sense of calm when you hold one and the initial pursuit of a goal produces the senses of calm and elation.

Tribbles are the mortal enemies of Klingons.  Goals…..okay that is where the analogy ends.

Tribbles tell a tale about balance.  Out of control and without natural predators on a starship they invade and consume the wheat intended to address a planet-wide food crisis.  Goals can do the same thing.  We set goals for everything.  Want to be wealthy set a goal.  Want to get married, set a goal.  Want to learn a language, set a goal.  Want to travel, have better teeth, a better body, get better grades, pass a test, almost anything you can think of, set a goal, for goal setting is the first step to actualization.  Or is it? Common mythology is that by just setting a goal, you will be magnetized to its achievement. But anyone who has ever set a goal and had their target date whiz by knows better.  Bazerman, et al, in their controversial paper, Goals Gone Wild:  The Systematic Side Effects of Over prescribing Goal Setting argue that goal setting  can be quite detrimental in a corporate setting. They conclude:  “rather than being offered as an ‘over the counter’ salve for boosting performance, goal setting should be prescribed selectively, presented with a warning label and closely monitored.”

I have found that having no more than two or three goals at a time, whose achievement I have absolute control over are the appropriate goals for me to set.  I have also found when considering a goal, I have to decide whether or not I want to pay the price to achieve that goal.  All goal achievement requires time, yet setting aside the time to achieve a goal may seem like an impossible task.  In fact I have found that when I ask most folks how much time they plan to devote to achieving their goal, I generally get a blank stare.  Setting a goal to become wealthy means deciding to develop certain disciplines to attain that goal, like learning to save, learning to live on less than you earn, developing a new skill, becoming financially literate.  Setting a goal to learn a language may mean taking a class, actually attending the classes and studying the material once you’ve signed on for the course, taking a home study course, traveling to the country where the language is spoken primarily or staying at home and putting yourself in socially uncomfortable circumstances where your desired language in only spoken.  Goal achievement also requires having a set of priorities.  Do you really want goal x or would you rather be doing something else.

Goals used strategically can spur achievement, but used unwisely, they like Tribbles can proliferate and become abundant evidence of one’s failures.

Please comment.  What are your thoughts about goals?

Where is the horse and the rider?
Where is the horn that was blowing?
They have passed like rain on the mountain,
like wind in the meadow. The days have gone
down in the West behind the hills into shadow.
How did it come to this?

Theodin King, Two Towers

I do not understand what I do.
For what I want to do I do not do,
but what I hate I do.

Romans 7:15

Our decision making process is a mystery. Bummer that because that process impacts everything from how we choose to spend, save, invest our money, to how a doctor counsels a patient, how a lawyer counsels a client, how a pilot lands a plane. Knowledge isn’t enough, skill isn’t enough. Our decision-making process is complex and fallible. In the world of personal finance there is Why Smart People Make Big Money Mistakes by Belsky and Gilovich. In general decision making there are Blink by Malcolm Gladwell and How We Decide by Johan Lehrer. In the world of medicine there is The Checklist Manifesto by Atul Gawande, MD and How Doctor’s Think by Jerome Groopman, MD. As a society we think about how we think and with good reason. How we think, what we decide and the actions that flow from those decisions will ultimately determine where we land in life. Dr. Richard Friedman’s essay Sabotaging Success examines a tendency that some people have to engage in masochistic behavior.

As a physician I am especially concerned with medical errors. Gladwell’s thesis is that decisions occur on a near intuitive level defying explanation. That intuition is influenced by experience. Lehrer proposes that it is emotion that occurs on an unconscious level that informs our decisions and Dr. Gawande argues and, I tend to agree, that the decision process is flawed so we need to have a system of simple and efficient checklists to facilitate good outcomes.

In the world of personal finance it is easy to say that we don’t save because we don’t know we should save or how to do it once we understand that we need to do it. You cannot walk into a book store without running into a personal finance book. You read, not one, but 10 and you have the knowledge that you should save and even a clear idea of how to do it, but you don’t. Now you are up against how you decide to do what you do. This is the hardest thing to accept: knowledge is not enough to affect the decisions we make or the actions we take.

In the world of medicine it is easy to counsel a young physician who makes a mistake because we can chalk his mistakes up to both ignorance and lack of experience. What do we do with a physician
with over 20 years of experience who makes a basic error that leads to patient harm? Because decision making is complex, the answer to what do do is equally so.

We may never understand how we decide. Our brains are a series of neuronal connections awash in chemicals. Knowledge, though necessary, is not enough and neither is repetition. Yet we cannot make good decisions without them. Is developing emotional intelligence, the ability to govern our emotions and act in the face of them, the answer? It is certainly an answer, but, in all likelihood is not the answer. What do we do, then? We should accept how complex our decision making process is and that it may represent a complexity that “passeth understanding”. We should continue to gain knowledge and skill. Finally, we should understand that faulty decisions will occur and try to learn from them.

What are your thoughts? Please comment.

It is only natural at age 47 to begin to review your life choices. I know I am reviewing mine. When I was in my twenties, I was filled with all the promise of life, still in college, applying to medical school, walking to the student union one day thinking that this is a great country in which a kid can be a kid wanting to be a grownup and a doctor and then, Bob’s your uncle, it happens. In my 30’s a doctor, a new practice chairman, newly in love and broke. Gotta get ahold of this financial thing was what I thought, and so I did. Then the 40’s hit, I have friends who have passed on, others who have gotten injured or ill and are disabled, others who have divorced and are trying to put the pieces back together. I have grown older with my patients. It is only natural to look at the world around you and reflect on how you got there. I have friends and acquaintances in the blogosphere who are half my age, have sold all of their worldly possessions and are traveling and I know that life is not for me. Traveling is…in fact I really like to travel, some of the pics in my gallery on this blog are from Hawaii, the UK, Peru and parts of the California wine country. No, I like my possessions, that permanent dwelling I call home. I will admit that I do have too many possessions. My home flooded in 2007. When your personal things are floating around your home after a disaster like that and you need a net to scoop them up to quickly get them out of your home, you have too many possessions and that was me. I have been de-cluttering ever since. Being more than half way there, it is only natural to reflect on retirement. Will I make it with the lifestyle I want? I got my 401K during the heady 1990s. It was common to plug in numbers like 15% to see how long it would take to reach the magic final number. Max out your contributions and your company match and you’ll get there no problem. Now we know that 15% was a fantasy. A mirage. A folly that few had the wherewithal to question until the markets came tumbling down. Now I am looking at 6% and considering myself lucky. Thank goodness I bought income-producing real estate. The 50’s are knocking at the door and something else is happening. Time is moving at blinding speed. It will pass no matter what I do. One of my friends is fond of reminding me to suck the marrow out of life. She wants me to become a marrow-sucking fiend. I like marrow, grew up sucking it as a kid so I know what she means. Exhaust every opportunity. So when my friends and I get together, we talk until all hours of the early evening (we are middle-aged, you know) until our eyes are closing from sleep. I have trips and projects planned until 2011. Given the life expectancy of the women in my family, I am right in the middle of life. Life is whizzing by and it is only natural to reflect and consider a course correction.

What are you reflecting on? Please comment.

Master, don’t take it to him
He wants the precious.
Always he is looking for it.
And the precious is wanting to go back to him…
But we mustn’t let him have it
Gollum

It’s a livin’ thing
It’s a terrible thing to lose
It’s a given thing
It’s a terrible thing to lose
Electric Light Orchestra

The importance of money
flows from it being a link between
the present and the future.
John Maynard Keynes

Money is a living thing. That it seems to have a mind of its own is why so many of us seem to have such poor control over it. The hot stock tip that crashes, the totaled car that you still owe on, the feeling that when you get ahead just a little bit, someone steps up to claim your surplus. Money like the ring of lore truly seems to come and go where it pleases providing the link in our lives between planning for today and planning for the future. Who plans for the future without consideration of money? Money seems to hang out with some people and flee the company of others. The presence of money can create poverty in the lives of those who have it and the absence of money can create wealth in the lives of those who know how to live richly. What is money then, is it want and desire does it feel or is money simply neutral responding to the feelings and emotions of those who handle it?. In my post The Money Shot I talk about an amusing and fun exercise that I did to forge a conscious relationship with my money. The truth is that until my Walmart epiphany I had engaged in behaviors that told money that I had no respect for it. I spent what I did not have on things that I ultimately did not remember buying. Many of the items that I did buy were consumed, given away unused or damaged beyond repair when my home flooded. I had lost the connection, if I ever had it, between me, my work product, the money that work product created and the items that money could buy. I never asked myself, while I was going crazy, if the items I bought were worthy of my work. I finally figured out that money hangs out with people who have the following characteristics. 1) generosity of spirit (by this I don’t mean giving money to constantly broke relatives or to people who have proven that they cannot handle money. I mean giving money to situations and charities in which you know the money will be used in line with your priorities). If feeding the poor is important to you then generosity of spirit may mean that you donate your time and money to the local soup kitchen. 2) a purpose for money. Money has specific goals in their lives 3) respect for money. You know where your money is going and why 4) value for money. By this I don’t mean that people understand that money is valuable. What I mean that people who create and hang onto money understand that money follows value. See it is not just enough to pay off debt. Once the debt is gone, or better yet while you are paying off the debt, you have to develop a clear philosophy with respect to money or the same financial challenges that led to the debt will manifest in a new form. I have been out of short term debt and on solid financial footing for a over a decade now, but like the alcoholic who is one drink away from falling off the wagon, I am occasionally afraid that I will overspend. I simply have to trust that the financial habits and philosophies that I have developed over the past 13 years and my on-going financial education will see me through as I forge my link from now to the future.

Goal Setting may be oversimplified, overrated and downright dangerous. Business school professors from the University of Arizona, Northwestern, Harvard and the Wharton School examine the downside to goal setting. This article has unleashed a storm of controversy.
Read it at http://hbswk.hbs.edu/item/6114.html