In April, 2001 I was coaching a well-known yearlong Financial Services program. This was the first quarterly follow-up meeting and all of the participants were giving their Ideal Client Acquisition reports.
Each participant walked to the front of the room, placed their Ideal Client Profile on a flipchart, and presented their numbers like this, “My ideal client has a minimum of $1,000,000.00 in investible assets. They’re worth at least $5,000.00 a year to me in annual recurring revenue. I need 200 ideal clients to be done. I acquired 6 new ones in the past quarter giving me a total of 26.”
Or they might say, “They’re worth at least $10,000.00 a year to me and I need 100 to be done.” Or, it might be, “They’re worth $7500.00 per year to me and I need 150 to be done.
As I listened to the reports I had a consistent gnawing sense that something was out of whack with these reports. I finally figured out the pattern. With only two exceptions…each of the 23 participants had a goal of earning $1,000,000.00 per year.
Earning a million dollars in a year is a worthwhile goal. But let’s be candid! They’re probably NOT going to make it. They’re probably not going to make it for the simple reason that “round numbers” have no motivation.
Please let me explain. A million dollars is a round number. So is one hundred thousand dollars. If someone sets a “round number” goal it means that they just made it up. In nearly every case they didn’t actually figure out how much they needed to make…they just picked a number “out of the air” that sounded like a good number to shoot for. Nothing wrong with that is there? Sales managers seem to do it all the time!
There’s nothing wrong except that if there isn’t a real reason for you to earn that amount of income then you’re probably NOT going to do it. Granted, it’s a benchmark for MOST people in sales. “Someday I’m going to make a million dollars in one year!” But, that’s more of a want than a need.
So let’s say it’s the middle of May. You’re five and a half months into that yearly goal of earning the big Mil. You’ve been working oh so very hard and you’ve been doing really well. You’re on a record pace. You have more than enough money to pay your bills, fund your pension, and buy a few “toys.” And, one afternoon in May, you still need to spend a couple hours calling prospects to set up enough appointments to stay on track. The phone rings and one of your buddies says, “Hey! Let’s play a few rounds of golf this afternoon! You’ve been working really hard! You’ve earned it! Come on! Let’s go! Let you hair down a little bit for “Pete’s sake!” And…YOU GO!
You go because there isn’t really any reason other than a psychic one to earn that one million dollars. It’s just a made up number anyway. You’re already making enough money to handle all your needs and once that happens there normally isn’t a lot of motivation to earn a whole lot more. So, you fall short of your goal!
If you don’t know exactly how much money it takes to pay your bills and fund your life, including your financial future, then you’re just guessing with your goals. You may very well be like a lot of Financial Advisors who always seem to be living paycheck to paycheck. And you may even feel a bit hypocritical when you advise your clients to do things you aren’t doing yourself.
Let’s fix that for you! Let’s get you on the right track, strengthen you self-confidence and your resolve. Here’s how to do it.
- First, create a way to record every dollar you spend each month. Going back 3 to 6 months will provide an even better idea of what it actually takes to fund your lifestyle. You’ll probably also discover quite a bit of wasted money.
- Complete a Financial Goals List, identifying what goals you have in the future requiring money and planning to accomplish them.
- Hire your own Financial Planner to help you create a written Plan on how to achieve your financial goals. This plan should include exactly how much money you need to earn, keep, and invest each year in order to reach your goals.
With these three simple steps you’ll know exactly how many dollars you need to earn each month in order to achieve your financial future. Now THAT’S a financial Goal that works! Do this and you’ll be more congruent, more confident, and more consistently motivated.
Doug Carter, with Jenni Green, is the author of Clients Forever: How Your Clients Can Build Your Business (McGraw-Hill). A sales professional and trainer for more than twenty-five years, he is the founder and CEO of Carter International Training and Development Company. Learn more at www.dougcarter.com or [email protected].