A Mindset of Kicking Financial Stress Out of Your Life
After reading dozens of books, watched hundreds of hours of documentaries and shows and listened to countless hours of audio on personal finance and you really only need to know few things to succeed. is successful people think, act and perceive the world differently.
This behavior gives them the ability to see reality differently, ultimately allowing them to create their reality. A reality so many feel is impossible. If they realize it even exists at all.
This is not to say that everyone who acts differently suddenly will have the same chance of living this better life. There is geographical reasons, intelligence, luck, and background just to name just a few variables outside of our everyday control.
I want to make it clear that none of these are reasons to be unsuccessful. For every excuse why not, there are a hundred examples of people who have overcome that very roadblock to succeed. That just changes your specific details or unique story.
1.) Take Action
Nothing in this book or any financial book will ever mean anything and will do nothing to make your life better until you take action.
Of all the books I have read, videos watched, podcasts listened to, and seminars attended only one thing has ever yielded any results, taking action.
It is often the number one tip of entrepreneurs, business owners, and successful people and it is my #1 tip for you, take action.
At some point in your life you will need to stop learning, stop reading, stop dreaming, stop making excuses, and quite simply, take action.
I wrote this book because I want others to know where to take action in their own personal finances. Save $1, don’t buy that latte, earn extra money, start creating a business, get your family, friends, and children on board, it doesn’t really matter where as long as you take action.
The goal of this book is to show you the possibilities and provide the knowledge and inspiration to be one of those few who do more with their life. Once you accept that it is possible and make the choice to make it happen, all that is left is taking action.
2.) Consider The Cost Of Inaction
As humans we naturally think about the possible negative consequences of taking action. What if I fail? What if I lose the money? Humans have an incredible ability for creating negative what if scenarios.
We do this because our brains evolved1 over tens of thousands of years to protect us. If I move will a predator see me? If I drink that water will I die?
So how do we overcome this fear of taking action? Consider the Cost of Inaction. That is the concept of asking yourself what it will cost you if you do not take action. Another way of thinking is to think of all the scary things that may happen if you do not take action.
This type of thought should be part of any major decision in life. The cost of not taking action to better yourself professionally will cost you possible wage increases, job opportunities, and an increased chance of staying at the bottom of the ladder.
The most common cost of inaction is an average life. Though certainly no longer a guarantee, the Cost of Inaction for not going to college could be a life-long career in fast food. So which is scarier 4 years of a college or a life of low paying jobs?
The cost of inaction is one of my most motivating tools. The whole reason I began researching lifestyle business and finance was because of my fear of my life not going anywhere.
I remember looking around at my bosses. I was in my early twenties and a recent college graduate. My bosses were twice my age and all I could think of was, “That is where I was headed!” I have never stopped searching for something new.
Start considering the cost of inaction vs the future value of taking action, not the current cost of taking action. Think about the negative consequences of not taking action and the positive possibilities of taking action.
3.) Change Your Daily Behavior
Changing your behavior is the only way to change of your life. To make these long lasting changes requires that you make long lasting changes in your behavior.
You can lose weight with a 90-day diet however if you go back to the same eating habits will the weight come back? Most likely.
Coming into more money while keeping your financial habits the same eventually lands you back in the same situation. Most people who win the lottery prove this time and time again with 9 out of 10 lottery winners spending every penny within 5 years1.
More money does not change a person. It simply amplifies one’s personality, habits, and behaviors. and opens up more opportunities as to how what they are able to do
The rest of this site will have various habit suggestions to help you change your behavior.
If you are sitting back and thinking, ‘Well, I just have to go to the movies every weekend!’ recognize that this is not an essential. It is important to distinguish what you need to live and what just makes living your life more fun.
4.) Realize It’s A Foundation, Not The Answer
So why concern yourself with being financially healthy? We all have personal finance. The real question is whether you are going to control your finances. Because who controls your finances will be the tipping point between having a life of security and complete happiness versus a life full of stress and uncertainty.
Personal finance will not directly make your life better. Personal Finance is only a foundation. Depending on how much fore thought and purposeful action you put into building this foundation determines whether it is a stable foundation or its about to crash.
Another words, are you living paycheck-to-paycheck>?
What you need to ask yourself is which foundation do you want to build your home and life on. Building your life on a shaky foundation, and it could come crashing down with the slightest hiccup.
We are all but guaranteed to spend money on retirement and medical and very likely on education. We all know this but few do something about it.
Because it is just too easy to enjoy things now, than it is to sacrifice for the future.
If we can just accept this sacrifice now and start building this foundation up, we could save ourselves a great deal of headache. Personal finance should be about making your life good.
There is no need for money to cause stress, headaches, arguments, or frustrations. Let’s work together for a better life. A life you define. A life any good person deserves.
5.) Consider The Future You
Are you taking money from your future self or are you giving money to your future self? It is up to you.
If you are borrowing money today you are taking money from the future self. If you are investing and saving money today then you are giving money to the future you. This is the battle between the future and present self.
You can borrow $100 today and make the future you pay $200 back or you can invest $100 today giving the future you $200.
With a 30 year mortgage at 5% you will pay over $2 for every dollar you spend. For a $200,000 mortgage you will pay $461,511 over 30 years.
If you have written down a why that truly interests you, thinking about the future you will be much easier. Your why should be making you think twice about taking from the future you. You should be thinking about what actions you can take today to get future you closer to your why.
Think about what or where you want to be in 5, 10, or 20 years. Start actions today to have it tomorrow.
6.) Create Your Own Luck
Like it or not, luck is part of the picture. When a major media outlet selects a first time author to be featured in their publication, it is often luck. When a small business lands a million dollar client seemingly out of the blue, it may be luck. When two people are sitting at the repair shop and one has the money to pay for it, the other person often thinks they are lucky. When you are sued from a car accident and your insurance covers the bill people love to say you were lucky to have insurance.
The only way a first time author will get a lucky break is if they publish a book. The only way for you to land a huge client is to have a small business in the first place. The only way to pay for emergencies is to build an emergency fund. The only way to get insurance to pay is to buy insurance before you need it.
Many things in life are pure chance, right place, right time, and right people. There are just too many variables to control them. However, there are variables you can control. Who you connect and work with, what you do with your time, and how you spend your money to name a few.
If you want more luck start creating an environment for which luck thrives.
7.) Live A Focused Life
In many ways a focused lifestyle resembles minimalism. The major difference being that with a focused lifestyle regardless of what you have or how much you have, you have it for a reason. Assuming your reason is not vague like “because I wanted it” you should naturally have less. In minimalism you will Getting rid of stuff has been almost as relieving as eliminating debt.
I do not consider myself a minimalist. However, over the years I have changed my mindset to less material items and a more focused lifestyle. Graham Hill did a nice TED Talk on this.
I threw out unfinished projects, reduced my home size, and stopped buying things unless I knew I would use them to their fullest value. Today I have much less stuff, much less stress, and have a surprising feeling of freedom that I had not predicted.
Don’t Organize It, Get Rid Of It
Minimalism is like wanting to get ultra organized by eliminating all the crap people tell you to organize. This also causes extreme focus.
6 Months, Your Out
Do you have a basement full of stuff or a garage so packed you can’t park in it. Take a day and clean them out. I heard an organization expert say that you should get rid of anything you have not used in 6 months because chances are you will never touch it. This for the most part has worked well for me.
8.) Understand Why Your Doing This
Your vision is an overall goal or why. It’s your vision of where or what you want your life to be.
Personal finance cannot be done in a vacuum. Getting out of debt is an admirable goal but what happens when you get out of debt? Saving money is great but how much is enough?
A vision gives you a reason to keep moving long after these these short-term goals have been accomplished. So what is your vision? This is going to be different for each of us and will most likely change and evolve over the years.
This vision is why you are building a strong financial foundation.
When you know why and you truly believe that why, you will naturally make different decisions.
Your goals and Your Why will be different but none the less I want you to have a why and to accomplish your own version of a better life.
You need to have a Why and goals so you know when you are accomplishing something and when enough is enough.
Ultimately why you are reaching for financial freedom needs to be your own. The steps of the journey to financial freedom will be similar for all of us, it’s the why that will be different.
Do you really want to go to work to make money to buy things you don’t need to impress people you don’t care about? If you are going to spend 40+ hours a week under an employer’s control shouldn’t that money go towards something truly valuable? Or should you just stop buying stuff and spend more time doing what you really want to?
We need to make that switch from thinking about today to thinking about tomorrow. This is the reason for creating a why. It will give you a reason to focus on the future and a reason to forget about today’s distractions.
To help here are my reasons:
- Want to earn interest, not pay interest
- Eliminate finances as a point of argument my marriage
- Be able to send all my children to college without incurring debt
- Go on vacations, beautiful, long vacations.
- Retire in my 50’s
- Start a small business without risking my current life
- Take 3 months when having a baby
First write down the reasons why you want your finances in order.
In over 7 years of marriage I can’t recall a single argument about money. We have a 529 college savings account for all three of our children. We have been to Ireland, Germany, Mexico (for brother’s wedding), vacations to the east coast to scout future residence, visited my parents in Florida, and have taken countless long weekend vacations. Each of which was paid for before we walked out the front door.
I have started a handful of small business (not all successful). We are well onto our way of having over $1 million in retirement by the time I am 50. I took 2 months off when my daughter was born and 3 months off when my son was born, most of it unpaid. We have no credit cards, paid off all our student debt, and the only debt we now have is a mortgage.
1-Don McNay, author of the book “Son of a Son of a Gambler: Winners, Losers and What to Do When You Win the Lottery,” says nine out of 10 winners go through their money in five years or less.