Do you dream of financial freedom, but feel lost in the fog of overwhelming debt and ever-rising bills or you just do not have a clue how to begin? Sure, you know in a vague sense that building wealth involves saving and investing, and each month you propose to start but with expenses multiplying, how exactly will you ever become financially independent?

Well, here is the thing — you are not alone. This dilemma is incredibly common. The underlying issue is usually that people tend to overlook the critical first step. When you decide to embark on a journey to financial independence, you need to figure out why you want to do it. If you are in debt, ask yourself why you want to get out of debt. If you are debt-free, ask yourself what the reason is for deciding to build wealth. Seems kind of obvious, right? But you would be surprised how many people cannot answer this question with clarity. Just like any journey, success in building wealth starts with clarity of purpose. In other words, what is your “why”?

To figure out exactly what drives you, consider creating a financial mission statement.

What’s A Financial Mission Statement?

You are probably familiar with a mission statement at the organisational level. A concise description, which explains why a company exists. It helps it to make decisions that are in line with its vision and respond to changes. A mission statement allows an organisations customers, employees, and leaders to understand the organisation’s top priorities. For example, Meta, owners of Facebook and Instagram, has “Giving people the power to build community and bring the world closer together.” as its mission statement. The NCB Financial Group’s (NCBFG’s) mission statement is “To be the premier Caribbean financial services group delivering superior products and services to satisfy the needs of our customers while developing our employees and building the communities we serve.” Knowing what we know about Meta and NCBFG, these mission statements probably don’t surprise you because each company’s statement sums up exactly what the company is known for.

Now, imagine a personal financial mission statement (or FMS). Just like a company’s mission statement, your FMS should encapsulate your financial “why”. In the same way that an organisation’s mission statement succinctly explains its overall reason for operating, likewise, your FMS should reflect your unique financial vision for your finances in alignment with your financial goals and values. It should also be a constant reminder of why building wealth and financial independence is important to you. Your personal FMS is, frankly speaking, the North Star for your financial strategy. It should be a written document so that you have a physical reference point to which you can always return. However, this does not mean that it is set in stone and never changes with your dreams and aspirations. It is just that thinking about financial independence in a nebulous kind of way only helps to keep you unfocused and feeling like your money is going in directions that you seem to have no real control over. Therefore, always, always, document your “why” through personal FMS. After determining your reasons for wanting to build wealth or financial independence, it is time to create the FMS.

Writing Your Personal FMS

Once you have worked out your why, there are a few more questions you should ask yourself, to help refine your FMS:

• What do I ultimately want out of life?

•What kind of lifestyle do I want to live, now and in the future?

•If there were no obstacles, what is the one thing I would pursue in life?

At first glance, it might seem like a straightforward task. However, it is not necessarily as easy as it seems. Crafting your FMS requires careful consideration, especially if you manage money with another person. Your FMS is a statement that should be meticulously crafted using the answers to these questions to help guide you in the direction you need to go to build your wealth. However, it goes beyond that. Your FMS should define who you are, leaving no doubt about your values and what you want your money to achieve. It should outline not only your financial vision for your life but also how you plan to achieve them. In essence, it’s an articulated financial vision that helps you focus on making the right financial decisions for you and your family for years to come. Typically, it should include these aspects:

1.Why do you want financial independence

2.What are the obstacles and opportunities to be addressed (purpose or why)

3.How will you overcome these obstacles and embrace the opportunities (plan)

4.What are your principles and how do they align with achieving your goals (values)

So, for a young woman/man who is debt-free, her/his FMS could look something like this: “My goal is to build generational wealth (purpose) by focusing on shoring investments for my retirement in 25 years’ time by contributing every quarter to ethical investment, such as sustainable energy, and other investment opportunities that I believe in. I avoid investments that do not align with my beliefs, like the tobacco industry. I will take on additional part-time employment for extra savings (plan) in order to maintain a strong quality of life during my golden years that involves travelling the world and donating to charities close to my heart (values).”

Let us say the person is older, with a family, and overwhelmed by debt. Their FMS might look like this: “The Cunningham family is determined to dig our way out from the mountain of debt we have been buried under by paying off our bills by 2026 (purpose) by aggressively making payments to creditors every month and retaining only one credit card for absolute emergencies (plan). This will allow us to stop renting and start investing to buy the home of our dreams so our children can finally experience peace of mind and not be surrounded by parents who are always arguing about money as a result of our past bad relationship with money, which we have pledged to not return to (values).”

When you articulate the things you want, it becomes easier for you to make other shorter-term financial decisions, such as whether the young woman in the first example can in fact finance the luxury car that she’s been thinking about buying, which might be a want and really not a need at all. It can help the Cunningham family determine whether they can really afford a family vacation this year, or should they simply find a creative, cheaper alternative that is more aligned to their longer-term vision of eliminating debt.

Creating a personal FMS is the first step toward achieving financial independence and building wealth. It helps you to set more targeted goals and increases your chance of success because you know exactly what success looks like for you. Whether you are aiming to pay off debt, save for retirement, or build generational wealth, your FMS will keep you on track, ensuring that your financial decisions align with your long-term vision. So, take the time to craft your FMS today and start your journey towards financial freedom!