We work hard and earn money either small or big.
We also toil and struggle but most of us are still struggling financially even when we earn high.
If you’re tired of being stuck in regular financial mess, do the following:
- Develop a Growth Mindset.
The first thing that needs to be done on the journey towards Financial Independence is to make a mind shift from negativity to positivity. This involves shifting your thoughts from impossibility to possibility of savings and investing towards exiting the rat race.
This mind shift can be difficult but it is absolutely necessary because it is what empowers the human for a life of abundance. Every invention or innovation or change started in the mind as a thought. When you think it is possible, then you will keep working on the possibility till you achieve what you set out to achieve about Financial Independence. Be resolute on achieving your financial goal.
Remember, “Whether you think you can, or you think you can’t, you’re right” – Henry Ford.
- Next is just start saving no matter how small and be regular.
To be able to understand and cultivate the Culture of Savings, let’s first break down the concept of wants and needs.
Wants are those things you desire to have even if they are not so critically needed for you to survive. Everyone wants good life which is endless. Human wants are insatiable!
On the other hand, your needs include those things that you will require to run through life.
Wants are different than needs in that you may want a brand new Toyota Sienna minivan (2021 model) to live a good life but what you really need is a reliable vehicle to convey you from one place to another so as to make your work or life easy.
So, this will guide you in spending lesser than the unthinking Financially unintelligent person who will spend more money to impress or to feel good. You therefore will have more money to save.
I will like you to check up write ups on the Marshmallow Test. This explains the effect of Delayed Gratification in the achievement of success. You have to be determined to feel some pain from depriving yourself of some enjoyment by saving from your earnings so that you can have longer lasting enjoyment later after the savings and investment may have yielded profits.
When you decide to move out of the rat race, there must be a commitment to go all the way to achieving financial independence.
The starting point is with saving at least about 10% of your earnings every time you earn. If 10% appears to be too challenging for you, you can do less, may be 5%. Make sure this is regular and you can decide to open a savings account for this purpose only.
One easy way to be able to achieve the saving culture will be by starting to track your spendings and plan the month’s spending ahead.
You must know that people will criticize you as you save and plan for exiting the rat race but you are the one that understands why you’re doing what you’re doing.
- Be patient in learning how self discipline works for wealth creation and growth.
When saving, there will be times that you may get tempted to spend from your savings or even from your investments. Know that the most important part of all these processes is building the culture of savings and investing.
The amount you save or draw from your savings may not be the most important but the fact that you’re saving and are cultivating the culture of savings. Don’t break the chain!
- Learn to invest in small ideas before big ideas.
Most people tend to be in a hurry to invest in big ideas as soon as they have appreciable amount of money from their savings because they want quick big money, not realising that savings and investment are both learning processes for wealth creation.
You need to start small even with your BIG dream and grow big gradually. This will give you the opportunity to learn and make safe mistakes from taking small risks. As you take up more challenges, you’ll grow and get more experience in handling bigger projects or investments.
- Persevere if your ideas or investments don’t work as expected.
Try again and again while learning better ways of doing it right. Understand that it may take time, no short cuts!
When you understand that it’s a process and every bit of the process should be celebrated, then you will appreciate every step no matter how small or how slow. Persevere and never give up on this journey. No one that ever had financial freedom had it easy, this is because if it were easy, everyone will be wealthy!
Learn to keep at it and make every step count. Each time you take a step, know that you are a step closer to your financial goal. There will be a chance that you will get tired when your goal is not coming through early enough, still keep at it. There will be a time that you will take just one more step and the result will be realized just like the last straw that broke the camel’s back!
- Be mindful of your circle of friends.
Hang around people that have achieved it or those seriously working on achieving the same financial Independence that you are working towards.
Research has it that you are the average of the 5 people you spend most of your time with. Don’t hang around people that aren’t working towards achieving the kind of financial dream you are building for yourself.
- Again, remember to always save before spending from your earnings not vice versa!
Never forget that you are supposed to save before your salary is paid as opposed to what others do: spend even before earning so much that some people will be owing before monthly salary is paid. It’s a very bad habit.
Save before you start spending since you will have planned your spending from the tracking done earlier.
All the best!
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