Do you find yourself sometimes confused about what it is you should be doing with your money? You know that you want to build wealth but staying focused on your goals is overwhelming because there are so many things you want to accomplish. One week you’re convinced you should be paying down debt; the next, you’re thinking that you need to save and invest more. But you feel pulled in another hundred directions based on all the things going on in your day-to-day life, like paying mounting bills, taking care of elderly parents and relatives, planning a wedding, buying a home, or even financing a golden anniversary European trip.

So many things to do on this journey to financial security, it’s no wonder feelings of confusion set in at times, which for so many people will cause them to lose focus on their financial goals, or instead tackle them in a random way.

This is where a financial mission statement (FMS) can be helpful. A financial mission statement lists the things you want to accomplish money-wise and helps you to plan how to produce those desired results. What do you want to achieve in your life, and how will money get you there? In the same way that an organisation’s mission statement briefly explains its overall goals and values, your FMS should briefly outline your financial goals and values and be a constant reminder of why these things are important to you.

Read the following mission statement and see if you can guess the company it belongs to:

“Our mission is to continually raise the bar of the customer experience by using the Internet and technology to help consumers find, discover and buy anything, and empower businesses and content creators to maximise their success. We aim to be the Earth’s most customer centric company.”

If you said Amazon, you’d be correct. That’s because its core values, as laid out in its statement, are recognisable to anybody who has ever shopped with the company.

Similarly, when you write an FMS, it should be evident what your core financial values are and what you’re doing to make them come about. The FMS, which can be for you as an individual or as a family, always aims to inspire you to do the things you need to do to achieve your financial goals.

On the surface, it might seem an easy thing to do. But it’s not necessarily as easy as it appears. A lot of thought needs to be put into it, especially if you manage money with another person. The FMS should be a written document so that you have a physical reference point that you can always return to, although this doesn’t mean that it is set in stone. Your FMS should address, at the very least, these items: Purpose, plan, and the values that direct the actions you take to get there.

An example of the FMS of someone who wants to build wealth, therefore, would perhaps look something along the lines of this:

“My goal is to build generational wealth (purpose) by focusing on shoring up savings for my retirement in 20 years through steadfastly contributing every quarter to ethical investment opportunities that I believe in, as well as taking on additional part-time employment (plan) in order to maintain a strong quality of life in my golden years (values).”

Or, let’s say your family is looking to extricate itself from debt. Your FMS might look something like this:

“The Jones family seeks to eliminate the vicious stranglehold debt has had on us by 2025 (purpose) by aggressively making payments to creditors every month and retaining only one credit card for absolute emergencies (plan) so that we can stop renting and begin to start saving to buy the home of our dreams so our children can finally experience peace of mind and not be surrounded by tense parents who are always arguing about money as a result of our past toxic spending habits (values).”

When you articulate these things it becomes easier for you to make other shorter-term financial decisions, such as whether the individual in the first example can in fact finance the luxury car she’s been thinking about buying, which is really a want and not a need. Or whether the Jones family from example two can afford to take a family vacation this year, for example, rather than simply finding a creative and cheaper ‘staycation’ alternative which would be more aligned to their long-term goal of debt reduction.

If you haven’t already, write an FMS for yourself or your household. If you have already, revisit it annually or whenever there’s been a major change in your life. Remember, your needs, wants and priorities change over time with the many life events you will experience. On your way to financial freedom there’s a finite amount of money at your disposal. Make sure to spend it wisely.