Are you picking the wrong money goals?

Setting smart, achievable goals is important if you want to take charge of your financial life. But many of us are surprisingly bad at choosing the goals that actually matter most to us.

Investment research firm Morningstar had 318 people write down their top three financial priorities, then showed them a master list of goals prepared by the researchers. Three out of four investors changed at least one goal after seeing the master list, and one out of four switched their top priority.

“We were like, ‘Wow. People don’t really know what they want,’” says lead researcher Ray Sin, behavioral scientist at Morningstar.

Other behavioral research has shown that even when people think explicitly about what matters to them when making decisions, they overlook many of their most important goals. That interferes with their ability to evaluate their choices and consider alternatives.

Among the problems: We’re better at thinking short term than long term, Sin says. Plus, we may overvalue goals that are currently on our mind.

A renter who just attended a housewarming, for example, might say her top priority is saving to buy a home. She may forget that she really wants to be able to quit her job and travel the world for a year. She probably has other goals as well, such as retiring someday and perhaps starting her own business.

Of course, all those goals may matter to her, but “resources are finite,” Sin says. That’s why prioritizing is so important. Someone determined to retire early, for instance, may not be able to fully fund a child’s college education or leave an inheritance.

If you want to check for your own blind spots, quickly write down your three most important financial goals. Then look at Morningstar’s master goal list and see if you want to change what you wrote: • Be better off than my peers • Pay for personal self-improvement (e.g., go back to

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