Every year around October most people begin destroying their ability to make next year ‘THE YEAR’ their financial life changed for the good. This is because it’s about the time when people begin losing their minds and start overspending at a frightening rate.
The Cause: Consumers don’t know the difference between ‘slavery’ and ‘financial freedom
Most consumers believe that a wealthy person is someone who can buy what they want, when they want and it makes no difference to them. This thinking is the reason why these same people end up working their whole lives (often not doing what they love to do) to make lenders rich. Unfortunately lots of institutions still equip consumers, who are none the wiser, with credit cards and loan accounts to spend money they don’t have, to look rich.
Statistically speaking, most multi-millionaires are first generation wealthy. This means they made their money the old fashioned way; they worked hard for it and then had to learn how to look after it. They did not inherit the money, hit the lotto or happen to win a tender because they were friends with ‘the right guy’.
Before most wealthy people become economically free they begin like everyone else; earning average money and faced with difficult spending decisions all the time. They also had to contend with December and festive season shopping but at some point all of this needed to start working together with where they wanted their lives to end up.
What is the key to this change?
Handling your money this way takes a massive amount of personal strength and can only be achieved if you are serious about living life on your own terms.
The thing that defines economic slavery is the lack of choice a person has – the choice where you work, where your kids go to school or whether you can take your wife for a romantic dinner to reconnect.
If you are a slave to drugs you are unable to function without being intoxicated. If you are a slave to gambling then you can’t function without the constant rush you get from chancing your family’s financial well-being.
If you are a slave to money then you will find that instead of moving closer to your financial goals each month, the harder and longer you work, you will see it will seem you end up with less and less money each month.
If you want to be free then…
Be honest with where you are money-wise. Decide where you want to be financially at the end of next year and use this December to take a giant leap forward by keeping your spending low and rather pay down your debt. (Or commit to investing more if you have no debt) Explain this to your relatives; they can only be proud of the commitment you’re making. This way, you will have less debt next year and can begin paying a bit more to each of your creditors each month which will mean getting rid of them quicker.
Ultimately when you are free of debt you will have your entire salary to yourself each month. For most people, they will now have enough money to maintain a reasonable lifestyle and begin the process of setting up an emergency fund and saving to build wealth.
The thing I’ve learned about wealthy people is they are prepared to do what others aren’t, so they can have what others can’t. What are you prepared to do?
Author: Gary Kayle – Money Coach, The Money School