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Dr. Charles Barugahare- January 13, 2026
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Financial planning is the 3rd crucial skill in the financial literacy series laying the foundation for a better financial life. Here are 3 top financial planning mistakes most people make and how to minimize them;
Do not set goals during peak times or moments
—at New Year’s Eve, while on holiday, or when an important milestone has been achieved.
Why—during those moments you are either over exited, over challenged, or over inspired. This is when you recognize that have been tickled by a great conversation or read/watched something motivational that aroused your interest.
The peak fades with time
During such times, the goals you set will most likely be over ambitious and influenced by the environment you were in while at the time.
The danger is that when that environment changes and you get out of that peak season, you cannot keep up the pace. You need the same pace and momentum within which you set —the goals to continue.
So, please design or set your financial goals during normal periods (off peak) times. They will most likely not be engineered or influenced by the environment. Set baseline goals (real and natural as possible).
Your goals can only be implemented in real and natural environments. This is why Vishen Lakhiani says “Lowering your minimum raises your overall average.” It may appear strange, but let’s examine it with 2 examples.
Reading goal view
Instead of setting a goal to read for an hour every day, you can set a minimum of reading 10 or 15 minutes a day.
If you achieve that lower goal consistently you will be much better than the one who burns out in 2 or 3 weeks of a high target of one hour.
On the other hand, you can keep raising your reading standard from 10 minutes, to 20, then 30. Develop and nature that reading habit, then you can increase your targets later.
Financial goals can be emotional
When you find yourself in peak moments, emotions can significantly impact your decision-making and choices.
For instance, you can easily commit to fund a holiday or contribute to a fundraising event out of emotion. You may even commit to take your child to school X or Y that you may not financially afford.
Heightened feelings of excitement, anxiety or fear will easily cloud your judgment, causing you to make impulsive financial choices and decisions.
Thus, it’s crucial to approach financial planning in a real and natural environment as possible. Do so with a clear and rational mindset, which is often hard to achieve during peak times or moments.
You cannot figure everything out during financial planning.
My financial coach told me, that much as clarity beats certainty every time, there is an illusion around setting clear financial goals.
And this is his point, “clarity does not come from thinking or planning — you cannot figure out everything first, you cannot make a perfect plan. But clarity comes from moving while doing with whatever rough plan you have.”
The lesson is that at financial planning, you need direction
Think of it like a torch light at night, it will help you see a fraction of the road, you will only see the path as you continue moving ahead.
The path becomes clearer and more defined as you continue moving forward. You can not have a torch light that can see the whole road to your destination, the same applies to your financial plan.
Clarity improves along the way as you are moving ahead. You keep adjusting as you move ahead.
Please do not ask whether you have a good financial plan, check if the plan is helping you to move in the right direction. That is what will create momentum that matters most.
Correction, no judgment and improvement
Whatever financial goals you set; you will slip away, you will miss some days, or you will drift away. But, what you do next after the misses is what counts.
To most people, missing achieving a goal triggers self-judgment and doubt. A friend of mine said “mastery is the rate of correction not the absence of errors.”
Don’t judge yourself harshly, momentum is created not in self-judgment and biting yourself up. It is built in the ability to dig deeper and find a better way to do it.
Call to Action
Do not set goals during peak times or moments. Design and set your financial goals during normal periods (off peak) times in the real and natural environment as possible.
Appreciate that you cannot figure everything out during financial planning. Think of planning like a torch light at night. It will help you see a fraction of the road ahead, you will continue to see the path as you move ahead.
Don’t forget that whatever financial goals you set; you will slip away, you will miss some days, you will drift away— but what you do next after the misses is what counts.
In case you missed the previous articles in the series, here they are.
https://financelip.org/financial-literacy-series-no-1-understanding-the-laws-of-money/
https://financelip.org/learn-before-you-earn-and-spend-the-7-step-learning-guide/
