6 Steps to Identify Your Income Goals

I have an ambitious income goal for 2011.

With my number in mind, I woke up in a panic moment early (too early) one morning last week.

I was alarmed because I realized that I had no plan to reach that number.

The first step I took was to ground myself in reality. I encourage you to do the same by following the process I went through.

1. Decide on your income goal. It’s not the number that’s important, but that you create a plan to attain it.

2. Create a space to focus. Shut down email, Facebook, and Twitter and clear your calendar for the day. Really. This is all you’re going to be doing for this exercise. You can’t multitask and focus at the same time.

3. Gather your financial documents for the past three or four years. Because of a big jump at one point, I needed four years of data to determine my income goal. You may only need three.

4. Break down your income for each year into categories that coincide with your bookkeeping. For example, you might have income from art sales, teaching, product sales, and consulting. You can further break down art sales into more specific categories like paintings, commissions, sculpture, and the like.

I did this step in a Word document table for each year. My income categories were in the left column and the year was at the top. I also made a notes (comments) column to capture my insights into the numbers for each category.

5. Create a simple spreadsheet with the data from the categories and each year. Study the data closely and look for trends.

What were your biggest moneymakers for each year? When did they trend up?  When did they slow down?

6. Add another column for 2011 to your spreadsheet. Based on what you know and what you want to achieve from your life and career, add your income goals for 2011.

How will your future income be divided among the categories you have chosen? How much do you plan to earn in art sales? In teaching? In product sales?

What do you need to do more of to attain your goal? What do you need to do less of?

Where is your time best spent?

What should you delegate? Where do you need help?

Getting a grip on your past income makes it easier to understand where the money will come from in the future.

Do you have another way of identifying income goals?