I liked the way the old game Ultima IV approached character development. You had to elevate your character in 8 different virtues: honesty, compassion, valor, justice, sacrifice, honor, humility, and spirituality. There was no villain to defeat or princess to rescue. You won the game by achieving an inner victory for your character.
I sometimes think in similar terms about real life, although there are virtually limitless character qualities to develop beyond those 8 virtues.