This is a post from staff writer Robert Brokamp of The Motley Fool. Robert is a Certified Financial Planner and the adviser for The Motley Fool’s Rule Your Retirement service. He contributes one new article to Get Rich Slowly every two weeks.

Longtime readers may remember a few things about me:

  • At various times, I’ve studied to be a priest, a doctor, a teacher, and a financial advisor (though I was only two of those).
  • My posts can get so technical (okay, boring) that J.D. has to enliven them with cat pictures.
  • I’ve tried to lose weight over the past couple of years, and have concluded that reducing heft is very similar to building wealth.

Regarding the latter, I reported in January that I was down about 25 pounds in 18 months. Not bad – at least good enough to get me on public radio’s Marketplace (in case you’re dying to hear my nasally voice). Managing your cash and managing your flesh both start with giving up short-term pleasure for long-term gain.

This occurred to me again as I met earlier this summer with Ben Sterling, my office’s resident Wellness Fool. His scale told us that I had gained back almost seven of the pounds I had lost. I had still been exercising, but not as much and not as intensely, and I didn’t pay any attention to what I ate. Ben, in his wisdom, knew he had to give me more motivation – and given my financial background, he knew that motivator was money (though for me it’s the preservation of it, not the making gobs of it). So we made a bet: I would lose six percentage points of body fat by mid-September or I’d pay him $200 (which would go toward buying exercise equipment for the Fool office).

It got me motivated, but not quite enough – especially when it came to food. After all, it’s summer, a time of cookouts, gatherings, and vacations (and hot dogs, chips, ice cream, and fast food during road trips). Plus, I had three months; why rush things?

But then we did a check-in at the one-month mark, and my body fat percentage had actually gone up! So now I am trying to play catch-up. I exercise once or twice a day, attending cross-fit classes, watching P90X videos, riding my bike to work, dousing the gym rowing machine with sweat, and attending a weekly Kazaxe hour (sorta like Zumba) with these folks. I also have cut out just about any food that isn’t P&P: produce and protein.

funny pictures of cats with captions
via icanhascheezburger.com, where you can see more Lolcats and funny pictures

As I flagellated myself for slacking that first month, I thought about how having three months for the goal didn’t create enough urgency. And then I thought: This is why people don’t save for retirement: There’s not enough urgency. But it’s even worse for retirement, because once people feel that urgency, it’s often too late.

This past weekend, the New York Times published an article by economist Theresa Gharducci, which claimed that “Seventy-five percent of Americans nearing retirement age in 2010 had less than $30,000 in their retirement accounts.” In esoteric financial terms, most of these people are screwed. Yes, some have sizeable, secure pensions, but not most of them. And yes, some will just have to work well into their 70s, which isn’t the worse thing in the world. However, that only works if you’re physically able to work, and many senior citizens aren’t. (I am compelled to point out that many of these health problems are due to poor health decisions compounded over decades, which is yet another way weight and wealth are related.)

If I had trouble with a goal that was a whopping three months away, is it any surprise that people lollygag about something that is three decades away?

Fear and Greed, Bit by Bit
Despite my midsection deflation procrastination, I have been saving for retirement since age 25, and that’s when I was a teacher, so I wasn’t exactly rolling in the boodle. What got me to save back then for a goal four decades hence? A fear of financial privation and loss of control. You don’t want to hear my family history – and my family doesn’t want me to tell you – but suffice it to say that I had a front-row seat to visits from sheriffs, property repossessions, and debt collectors when I was a young-ish fellow.

Fear might not be the kick in the rear you need; perhaps salivating over future wealth inspires you to forgo some current spending. Whatever it is, finding what motivates you is the first step.

Then, as much as possible, break a long-term goal into short-term chunks. The sooner the goal, the easier this will be. If you want to pay off a credit card or buy a car in five years, it’s relatively easy – perhaps using an online savings calculator – to figure out an annual or semiannual goal. For retirement, it’s more complicated. I’ve written before about how to use a calculator to estimate whether you’re saving enough for retirement. While I think such a process is useful for everyone – and crucial for anyone at least in their early 50s — the truth is that the ability of a calculator to estimate your retirement needs declines the farther you are from retirement.

I have a colleague here at The Motley Fool who is in his early 40s and who has taken a different approach. He has three primary goals:

  1. Remain debt-free, except for a mortgage
  2. Pay off that mortgage in 15 years or sooner
  3. Invest a specific amount each month

He has a spreadsheet that tracks his goals. What’s most interesting to me is #3. Retirement calculators assume you need a specific amount by a certain age to cover a certain retirement income. But the truth is, if you’re a couple of decades from retirement, you don’t really know what your investments will be worth, what your income needs will be, and how much money you’ll need to cover that income (especially given that no one really knows what Social Security and Medicare will look like in the 2030s or beyond).

As he told me:

It would be silly for me to guess what my $5,000 Roth contribution will be worth in 20 years. I can’t control what it will be worth, but I can make sure I have no debt, a paid-for condo, and consistent monthly paid-in capital [i.e., money that has been socked away, which in his case will be at least a few hundred thousand dollars absent any growth whatsoever].

No Potential Pain, No Aspirational Gain
The final component is accountability, which for my health goal is that $200 bet with someone who will hold me to it. After this challenge is over, I plan to keep making bets with Ben – such as I can’t permit my body fat percentage to increase more than two percentage points or I owe him $200, with monthly check-ins. Otherwise, I fear it will be too easy to slide back. If you don’t have a fitness expert to make you put money on the waistline, make bets with your friends or use a site like Fatbet.net.

I suppose the same type of bet could be made about a financial goal, but for some reason, it seems counterproductive to make someone pay money if they’re already having trouble accumulating it. One option is determining an annual savings goal, which likely also entails an annual spending limit, so you could target either one — and make bets with friends that would involve you doing something embarrassing or repulsive to you (e.g., if you’re a Democrat, you put a Romney bumper sticker on your car; the Republicans get an Obama sticker; independents like me get both). Or use a site like TweetWhatYouSpend.com.

Or perhaps every six months, you sit down in a quiet space, and spend 10 minutes imagining — in explicit detail — what it must be like to be in your 60s with less than $30,000. That is motivation enough for me.