Money doesn’t just jump into bed with anyone.
It flows to those who appreciate it and understand the responsibility of managing it wisely. If you feel you are always struggling to get ahead then your thinking needs to change. Not only that, you need to do something different from what you have always done.
When I talk about budgeting for wealth, I am talking about how you want to live your life. When we hear the word wealth we conjure ideas of big business people like Richard Branson, James Packer or Gina Rhineheart.
What I see for you is not this; I see a business person wanting to get ahead and have a good quality of life with freedom and not having to struggle to get by.
Chasing big bucks is never going to work.
I have learned that wealth is not what money you have, but what you have left when you have lost all your money. It’s the ability to get up in the morning and be of value to other people. It is about your contribution to a service and what you offer to a business that they feel is worth paying you for. Chasing big bucks is never going to work. I know, I have been there and every time I go for the big idea it seems to always elude me and I find myself back where I started.
I have spent a great deal of time studying wealth, reading business books, finance books and attended a barrage of seminars on the subject. From this, I have learned a few things I think will help you understand where you are at.
- Have a budget. Know where your money is going. If you don’t put your money where you want it to go someone else will decide for you, in the form of unexpected bills etc.
- Save first. Your savings amount each week doesn’t have to be a huge amount, it just has to happen every week. Every quarter add 10% to your savings, if you do this, in two years you will double your savings amount, I have done this since 2013 and it works.
- Put aside three months of your living expenses and never touch it. This I learned the hard way. When I broke my leg I was unable to tend to my business for six months, I ended up eating into our savings to live and this really hurt me. I felt terrible because I let myself down and worse than that, I had let Lindsey down. If I had put aside three months of living expenses I would have been in a much better situation emotionally. Financially it would have been the same, but it was the emotional damage it did to me that was hard to take. From this, I learned that money should be put aside in a separate bank account and not kept with your savings.
- Have bank accounts for all the different things you want to set money aside for. I have many bank accounts, most of them are online savings accounts that don’t have large fees if any. The thing about this is that you don’t rob Peter to pay Paul. Having money set aside, for example for bills, puts it there for that purpose only. If you are saving for a holiday open a separate account and put the money in there. This way you know that everything is covered and when you have enough in the account you can go on holiday. Doing this leaves nothing to chance because your money has been set aside for specific purposes.
Always be wealthier than you were yesterday, even if it’s by $1.00.
Knowing that you are growing your wealth even by the smallest amount gives much confidence and encourages you to continue saving.
Pay off your debts.
When I say this I mean bad debt, such as credit cards, car loans, Harvey Norman cards that type of debt. This is consumer debt, the type that pays for items that do not increase in value but deplete your money. Think about the purchases you make. Are they necessary and do they add value to your life?
Live below your means.
There is a lot to be said about the minimalist lifestyle and how it affects our wealth. Steve Jobs (Apple) was known for his minimalist lifestyle. I read that in his lounge room he had a desk for a computer and a rug on the floor with a large cushion to sit on, that was it.
Living below your means does not mean being miserly, it means not being wasteful and buying things you really don’t need. Take time and think before you spend your money on unnecessary items.
Be realistic about where you live.
If you live in an expensive area you will pay accordingly. Think about this before you decide you want to live in the most affluent area of town. This kind of thing drains your money and your energy. Living to impress others is one sure way to lose your money. So many people spend time buying things to impress other people and really all it does is cost them, because one thing I have learned is that most people are so busy worrying about impressing someone else, they are not even looking at me.
Building wealth and leaving nothing to chance.
I want to live my life in a way that I can support others in their endeavours to improve their lives. To be in a place where we share in each other’s value, to create an environment to learn and grow together through training and learning. To run highly successful businesses that build wealth and have a clear understanding of what needs to be done and nothing is left to chance.