“Chains of habit are too light to be felt until they are too heavy to be broken”
– Warren Buffet –
If you are among nearly 42% of Americans (myself included) currently carrying credit card debt and feel like your debt situation has become too overwhelming to deal with on your own then you should consider getting some professional help to improve your credit.
The thing is, we get professional help on many things in life such as legal and medical, so why not hire a debt service to assist you?
Getting a free credit analysis from a professional will give you a chance to consult with someone who knows the in’s and out’s of credit disputes and the process of getting your credit back into good standing.
By working with a certified credit specialist, you don’t have to deal with the tedious work of filing dispute letters with credit bureaus, creditors and aggressive collection agencies. It’s their job to deal with credit disputes and provide good will letters to creditors on your behalf.
Certified debt professionals also know the laws and how to deal with unlawful debt collection practices. They can identify possible law violations and file complaints with the states attorney general, FTC and BBB (better business bureau) if warranted.
All of the headaches and hassles are removed from your responsibility to theirs. This not only will give you peace of mind by alleviating stress, but also provides you with valuable time to focus on other important endeavors.
Let the professionals deal with your debt
Sure, there are stories of seedy “debt relief companies” out there, but Credit Assistance Network is a legitimate company. They have an A+ better business bureau reputation with no complaints of corporate misconduct. They have trained certified credit specialists that focus on credit improvement rather than credit repair that is designed to help with virtually any credit related problems. Lastly, they provide personalized 1 on 1 credit building coaching.
Here’s how it works. Start by clicking here and provide the necessary information to set up a free consultation. Part of the enrollment process is consulting with a specialist who will give advice and get your feedback. Once enrollment is complete, the service department will thoroughly analyze you credit reports to evaluate what items will be disputed, how they will be disputed and on what legal basis.
Choose the solution that’s best for you
Ultimately, the decision on how to handle your debt situation comes down to the one that’s best for you. If you think you can repay your debts without assistance then keep doing what works. If however, you think that hiring a professional service might be necessary to help alleviate the stress of overwhelming debt management, then please contact Credit Assistance Network for more information.
I’ll see you in the next post. Until next time… be sure to comment below and let’s get some dialogue going. I’m curious to know, what tips do you have on debt management?
“Don’t let average people make you feel guilty for pursuing your mission in life”
– Eric Worre –
If you’ve been reading my blog (and you should be regularly… so please subscribe) then you know that I’m a big advocate for financial literacy and how the lack of it has had massive negative affects on peoples lives. The average person has very little financial knowledge which is why the average person has little to no savings, drowning in debt and nothing put towards retirement planning. The average person will NOT be able to stop working in their later years because they are not preparing properly, if at all.
Even though I’m not a financial planner (yet, but working on it), here’s a tid bit of financial advice anyway. Don’t be average… you can’t afford it!
Did you know that nearly 77 million Americans have debt in collections? That’s just a portion of people who are drowning in debt, Nearly one third of Americans pay the minimum amount due on their credit card each month because they can’t afford to pay more. In 2018 the banks and credit card companies racked up $104 billion in interest and fees.
Being average requires that you keep up appearances and maintain a heavy consumer mentality instead of an investment one. There’s no money left over to put towards financial planning when you’re focused on living a lifestyle beyond your means.
It’s only 43% of Americans who spend more than they earn and borrow on credit each month to cover the shortfall.Credit card balances reached $930 billion in the last quarter of 2019, which was an increase of $46 billion from Q3.
The average American household has over $132,000 worth of debt and that doesn’t factor in those with a mortgage, then it averages to over $172,000. This debt factors in things such as credit cards, mortgages, auto loans, student loans, medical debt just to name a few. The average credit card balance alone is $16,061.
Are you noticing a word that stands out a lot so far? And I’m not even finished yet!
Only 30% of Americans have a long term financial plan and many of those aren’t planned properly against estate taxes, future market downturns and unexpected misfortunes.The average American’s 401k balance is only $96,288 and that’s tax deferred so the the taxes have yet to be paid on that amount.In addition to that, only 18% of Americans actively contribute to an IRA which is capped at $6,000 annually for people under 50.
The average person lives paycheck to paycheck. In fact, ten million Americans don’t even have a bank account. I think it’s safe to assume that these same people also don’t invest for their future or have goals set to become financially independent.
The average American’s social security retirement benefit is $1,363 per month. That calculates to $16,356 annual income. The average retiree relies on social security for nearly 90% of their income but it was intentionally designed to cover only around 40% of the average workers pre-retirement income.
The latest spending stats tell us the average US consumer spends about $60,060 per year yet, money statistics in America for 2019 say the median yearly income was $48,672.
I could keep going on but I’m going to start to wrap this post up. I hope the point I’m making here is pretty obvious. The whole reason that I created this blog is to help promote financial literacy to average people so that the new average of financially educated people becomes the standard.
If you haven’t done so already, give some attention and love to a couple of my previous post linked below so that you can avoid being average and live a life that you can afford to live.
Please help me get the message out and share these articles on your social media accounts and assist me in my mission of teaching financial literacy to the masses… it’s my passion!
As I’m starting a financial services business, my time is becoming limited to what I can put towards writing this blog which is my passion. I will be continue to post new articles regularly, but they will be once a week and most likely on every Sunday.
I so appreciate you as a valued reader and it’s an honor for me that you give your precious time to reading this blog.
As I like to say… “the journeybegins with the first step”.
If you see value in this article then please be sure to subscribe to the blog if you haven’t done so already. I’ll be putting up more wealth building posts in the future and you can have them delivered straight to your email account.
Sign Up
I’ll see you in the next post. Until next time… be sure to comment below and let’s get some dialogue going. I’m curious to know, what tips do you have on avoiding being average?
“There’s a difference between interest and commitment. When you’re interested in doing something, you do it only when it’s convenient. When you’re committed to something, you accept no excuses; only results.”
– Kenneth Blanchard –
As someone who enjoys consistently learning about wealth building and then teaching to others what I’ve leaned up to this point, I often wonder how many people who are interested in building wealth are truly committed to the task. So let me ask you a question. As someone reading this right now… are you interested in achieving financial freedom or are you actually committed to doing whatever it takes to get there so long as it’s moral, legal and ethical?
I ask this because it seems most people have the desire, but not the drive. Everyone dreams of somehow coming into a large sum of money and all of the things they’d do with it, but they never intend to do the work by having financial goals set or even put any effort into pursuing any type of wealth building education whatsoever.
When you’re interested, you do what’s easy and convenient. If you’re interested you’ll allow your excuses and stories to convince yourself as to why you can’t. If you’re interested all of the obstacles that come your way will be larger than your vision and goals.
However, when you’re committed you’ll do whatever it takes. You’ll pursue and upgrade your knowledge, skills and develop the beliefs and habits to match your vision and goals.
Achieving financial freedom is a choice and part of the process to attain it requires taking action. If you’re not committed to something then it’s easy to make excuses and talk yourself out of doing whatever it takes to accomplish your goal.
So let me ask you this… which are you?
Without a sense of urgency… desire loses it’s value.
If you’ve decided that your committed then let’s discuss what it will take to make your desires achievable.
Set the goal and make a commitment to achieve the goal.
Once the goal is set, you then figure out how you’re going to do it afterwards. Most people believe they need to know how to accomplish them upfront or there’s no point in setting them in the first place. But the reality is, once you’ve committed yourself to them, the people, places, things and situations begin to reveal themselves a long the way.
Be intentional and specific about your goals designed outcome and set the date it will be accomplished. Specificity is the key to success. Keep the plan simple and easy to execute.
2. Feed your brain and reinforce your beliefs.
Begin to work on you… your identity. You’re limited by your identity and by what you think you’re capable of. Do things that stretch your identity and worth. You are your habits and rituals. Under pressure you’ll always go back to your habits, so develop habits, routines and rituals that serve you.
Start doing beneficial activities like affirmation meditation that feed your subconscious mind in areas such as self worth, self imaging and self esteem. Listen to podcasts and audiobooks, read books, blogs and watch videos on personal development and financial success.Experiment with all of these strategies and figure out what works best for you.
You need to learn that you deserve to be successful and not feel any sort of guilt for doing so. Good people only take what the feel they deserve.
Know that hard work matters. When you begin to do things that other people aren’t willing to do then you begin to believe that you deserve things other people won’t have. And it’s that type of thinking that will get you a seat at the table of success.
The hard work part plays into shifting your identity.
3. Put yourself in uncomfortable situations.
Another beneficial activity to stretch your identity and enhance personal development is to get comfortable with being in uncomfortable situations. Doing this and meeting set goals are probably the two most challenging things you will encounter in life.
By doing things you don’t want to do, you build mental toughness. Like any muscle, courage is a muscle that needs to be developed in order for it to get stronger.
There are those who fight the uncomfortable and those who can face the uncomfortable. Those who fight the uncomfortable are always hating, hiding and blaming. However, those that face the uncomfortable end up getting comfortable in it.Once you can overcome this obstacle there’s nothing that you can’t accomplish.
4. Associate with people who you look up to.
Mentors are a must have when you’re looking to grow. There’s a quote that says the five people that we look up to the most reflect our values and our integrity… that they’ll be a reflection of who we are.
Once we start to get intentional about the people that we surround ourselves with, we can rapidly transform our life. If we meet someone who’s already living and modeling the type of life that we want to live, we’ll able to learn from them since they’re already masters of that area.
Associate with people who are always striving to the best possible version of themselves.
5. Create momentum… it’s a magnifier.
As you combine the afore mentioned strategies together, it’s an amazing feeling to see everything coming together and begin falling into place. Small gradual gains amass to large accomplishments over time.
One way to start momentum is to never stop learning. Become obsessed with self education and then extract what you know and teach it to other people (like what I’m doing with this blog for example).
Become part of a group and empower each other. When you’re around like minded people with similar goals, the energy becomes contagious. That energy then motivates which then leads to taking action.
Momentum is a magnifier needed to achieve growth. Momentum is the invisible force that takes something from good and makes it great… from great to extraordinary.
The key to success is to focus on goals… not obstacles
One last thing I’d like to add before wrapping this post up. Don’t listen to people who tell you that you can’t do it. They are dream stealers who limit themselves and project those limitations outward onto others. Because you’re committed, they were sent to you to test your resiliency and dedication.
Keep the promise that you made to yourself when you decided that you are committed and forget about everyone else, it’s the foundation in your life.
If you can overcome and disregard all of the naysayers and doubters and get clear on what really matters, then you have a really good chance of accomplishing great things.
As I like to say… “the journeybegins with the first step”.
If you see value in this article then please be sure to like and subscribe to the blog if you haven’t done so already. I’ll be putting up more wealth building posts in the future and you can have them delivered straight to your email account.
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I’ll see you in the next post. Until next time… be sure to comment below and let’s get some dialogue going. I’m curious to know, what’s your opinion on being committed?
401K contribution $177.30 – current value $15,555.40
Fidelity brokerage account $30.00 – current value $256.55
Acorns Roth IRA $0 – current value $101.51
Acorns investment account $0 – current value $139.49
– A part of what I earn is mine to keep –
You can create your own acorns account by clicking here.
As usual I’m not putting a lot into my brokerage account as I continue to pay down my debts. But I will maintain paying myself first no matter how little it might be. I do contribute 6% of my pretax income to my 401k since my employer matches dollar for dollar up to 6%. Unfortunately the employer match has been suspended until further notice due to the covid crisis.
I only added $30 into the brokerage account this payday because I’m starting a business and will be putting more into that as time goes on. I’m putting funds from this payday towards educational material and will have to pay for licensing fees once I’m ready to take the exam.
There are multiple ways to invest and the most important investment you can ever make is in yourself.
I’m considering picking up more shares of BRG since it’s down and that would make the divided yield that much nicer. I’ve also been considering opening a position in another REIT as well.
Be sure to keep track with me and if you’d like, share your payday plan in the comments section below.
Until next time… be sure to comment below and let’s get some dialogue going.
“Financially irresponsible people are not bad people. They’ve simply fallen prey to bad habits”
– Mary Hunt –
Let me ask you a question that some people find offensive but I think is very important to answer honestly. Are you struggling to make ends meat like most of society is or are you comfortable with your financial situation? I ask this because 78% of of Americans live check to check with very little to no savings at all… let alone have any type of financial investments working for them.
The savings rate in america is at an all time low at less than 2% as a nation.
The main reasons of this unfortunate reality is because of bad financial habits that were formed early on in life combined with lack of financial literacy. These formed bad habits have a ripple affect in peoples lives that not only affect their financial situation, but are contributing factors in things such as domestic violence, crime and a growing divorce rate.
The good news is that it’s never too late to purge the bad habits and replace them with habits that you will find beneficial to your life in more than one way. It’s just going to require some desire and discipline to make it happen.
Here are five powerful habits that once adopted will not only strengthen you financially, but assist in overall personal development and help you a long the journey.
Embrace financial hardships & set backs, don’t deny them.
This is where a lot of people get deeply into financial trouble when they can’t make payments and get behind on their debts. Rather than face the reality of the situation and work with creditors to come up with some type of repayment arrangement, they ignore the problem by not replying to collection notifications via the mail or phone calls.
I know from my own personal experiences with this that depression and embarrassment take it’s toll on you. Living in denial only escalates the situation that can lead to things like repossession, frozen accounts, wage garnishment and in worse case scenarios, bankruptcy.
The best way to prevent this from happening in the first place, is to have money put aside in case of an emergency. This not only gives you peace of mind, but also has the health benefit of staving off depression and the ailments derived from it. Also, your credit score will thank you for preventing it from falling by accumulating late payments.
Always be willing to discuss options and seek out any type of financial assistance you can.
2. Check your credit score on a regular basis.
We’ve all heard horror stories from victims of identity theft and how it decimated them financially. This is one financial hardship that I can say that fortunately I have not experienced and make efforts to keep it that way.
With free credit score services like credit karma that allow you to check your score once a week, there’s no reason not to be able to monitor your credit on a consistent basis. In fact, once you’ve established an account with credit karma, they will present offers on loans and credit cards that may help you to refinance your existing debts into lower rate loans. Which in turn saves you money that you could put towards building wealth.
Some credit card companies allow you to check your credit score once a week as well. I know that capital one not only shows your credit score but provides your credit utilization percentage and how that has an affect of your score.
There are also paid subscription credit monitoring services available. If any credit discrepencies pop up they alert you immediately for verification of legitimate credit purchases to prevent fraudulent charges from occurring.
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3. Designate time for financial education, study habits of the rich& teach them to others.
The saying “give a man a fish and he eats for a day… teach a man to fish and he eats for a lifetime” has so much relevance when it comes to building wealth. As mentioned above, financial literacy is severely lacking in society. Therefore, it’s up to us as individuals to self educate through medias such as books, podcasts, videos and websites like this one.
Schedule time at least once a week dedicated to learning. One way to use your time wisely is to listen to audio books and/or podcasts while commuting and running errands. Instead of listening to music, put that time towards expanding your knowledge base.
By studying the habits of the rich and incorporating them into your own life, you can emulate their success. As you level up and become more successful, you can then take that knowledge and teach it to others.
Surround yourself with people you can always learn something from and people that you can teach. I find so much value in the philosophy of teach what you know as you learn what to teach.
4. Seek out opportunities that will benefit you financially & life in general.
I don’t believe that money is the root of all evil. However, I do truly believe that the root cause for most societal issues are financial. When you take financial difficulty out of the equation, stress levels drop, depression lifts away and people are generally more happy with life.
If you’re passionate about something then figure out ways to earn an income from it. When starting out it takes time to build momentum and get the word out, but over time it’s possible to make a full time income from it. You just have to stick to it and be dedicated to making it work.
What’s important to remember is to not make it about the money. If the products or service that you’re passionate about has value, the money will come eventually.
Persistence, passion and discipline are requirements in order to become successful in anything that you pursue. But none of them have purpose without taking action.
5. Find a support system of like minded people and be active in it.
You should always be striving to be the best version of yourself by setting goals and making achievements a long the way. It’s always more pleasant to take the journey with others and chances are that there are others looking to do the same as yourself. Network within your community and social media with people pursuing the same path and develop strong bonds a long the way.
Be sure to be beneficial to the group by reciprocating in helpful ways through encouragement and providing examples for others to learn from. If you find such a group already exists then consider joining it (hint… hint). If not, take the steps necessary to create one yourself.
“Surround yourself with people you can always learn something from. Always work with people that are better at their craft than you are.”
– Tony Vincent –
As I like to say… “the journeybegins with the first step”.
If you see value in this article then please be sure to like and subscribe to the blog if you haven’t done so already. I’ll be putting up more wealth building posts in the future and you can have them delivered straight to your email account.
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I’ll see you in the next post. Until next time… be sure to comment below and let’s get some dialogue going. I’m curious to know, what’s your opinion on developing financial habits?
“We were not taught financial literacy in school. It takes a lot of work and time to change your thinking and to become financially literate”
– Robert Kiyosaki –
There’s a lot of financial wisdom being shared all over the web. Tips, tricks, strategies, how to guides and step-by-step tutorials just to name a few. I’ve written a few blog posts about these things myself. Many of them offering valid advice and with the intent to help the average person gain financial wisdom.
But it’s not the how that’s the issue here, it’s the why.
What’s holding you back from accumulating financial wealth up to this point? It’s probably because you were never taught financial literacy when you were growing up. We are trained and conditioned from adolescence to become good employees that are dependent on getting a good job that we can survive off of.
Imagine this…
You’ve been working for this corporation for 24 years. You’ve been a solid employee that’s always arrived on time, worked hard and built up a reputation in your field as “the go to guy”. When shifts needed to be covered and staffing was short, you were the one who came through time and time again. You were the pinnacle of the ideal employee.
Now, you’ve just started working a 12 hour shift because they needed you to help them come in early to get things caught up. You step it up and manage to get things caught up to where they need to be and that’s just the first three hours into the shift. You work tirelessly all night to keep the chaos under control and finally get to the end of your shift. You’re called into an urgent meeting before you punch out just to be told you’re being let go.
Yep… been there… done that.
The problem with that is what happens when we no longer have that “good job” that we rely on to pay for our cost of living expenses? What were we taught to do when that happens? EXACTLY!
You see, the answer to that is to get another job that you have to hope won’t be lost again. Just continue to participate in the rat race until one day you can no longer work for whatever reason that becomes. And if you have no retirement savings to fall back on… then what?
You’re not broke because you can’t build wealth, you’re financially strapped because you weren’t prepared to build wealth from a young age. You were led to believe that making a lot of money means spending a lot of money on frivolous things and luxurious items because “you only live once” (YOLO).
The truth is that you don’t become wealthy because you make a lot of money. A person becomes wealthy because of how they manage the money that they make. The sad reality is that most don’t know how and that’s why people who make six and seven figure incomes still end up broke.
There are several key factors when it comes to building wealth, but two of them are extremely important. One of them is discipline. The fact is that no matter how well educated you are, if you’re not disciplined enough to manage your money properly, you won’t achieve financial freedom.
That’s where I kept messing up on my past attempts to build wealth. I didn’t focus on the discipline part and sabotaged my financial gains time and time again. I should be a lot further down the path to being financially independent than I am, but I haven’t given up and learn from my failures.
Which brings me to the second key factor to building wealth… perseverance. The ability to not give up and begin to rebuild a financial foundation with a better understanding of what it takes to be successful on this journey.
Too many people just accept that they will never become rich because they have the wrong mindset. Once again, they were conditioned to believe that financial wealth is for the “privileged” and the “lucky”. Simply because they were never taught financial literacy.
Because I know what it’s like to endure financial hardships and also because of my failed attempts to accumulate wealth in the past, I’m very empathetic to those who don’t know what they don’t know. It’s become my passion to educate and teach financial literacy so that others can avoid the mistakes I’ve made.
My goal isn’t just to achieve financial freedom for myself, but to achieve it with as many other people as possible a long the way. There’s no joy in taking the journey all alone.
The mission is to keep on teaching financial literacy as I make progress, however slowly, and track my progress to share with the readers of this blog. I believe in the philosophy of you teach what you learn as you learn what to teach.
In order for others to follow the path I forge, I feel it’s my duty to provide markers towards progress. Achieving financial freedom is a slow momentum process that gradually accelerates over time.
People don’t become successful because they quit. Building wealth isn’t easy but it also isn’t hard either. It’s about laying brick upon brick gradually over time. There is no “get rich quick” short cut to wealth that doesn’t come with high risk for the “reward”. Only fools fall for the dream of “overnight success”.
So the why in why I teach financial literacy is because I don’t want people to stay trapped in the rat race until they die. I want to see wealth and prosperity for the masses and less suffering.
I ask for you to be there with me as we lift up others who follow our lead and give back to those in need with encouragement, so that we can be the change we want to see in the world.
As I like to say… “the journeybegins with the first step”.
If you see value in this article then please be sure to like and subscribe to the blog if you haven’t done so already. I’ll be putting up more wealth building posts in the future and you can have them delivered straight to your email account.
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I’ll see you in the next post. Until next time… be sure to comment below and let’s get some dialogue going. I’m curious to know, what’s your opinion on teaching financial literacy?
401K contribution $177.30 – current value $15.637.43
Fidelity brokerage account $55.00 – current value $210.81
Acorns Roth IRA $0 – current value $103.35
Acorns investment account $0 – current value $142.77
– A part of what I earn is mine to keep –
You can create your own acorns account by clicking here.
Once again I’m not putting a lot into my brokerage account as I continue to pay down my debts. But I will maintain paying myself first no matter how little it might be. I do contribute 6% of my pretax income to my 401k since my employer matches dollar for dollar up to 6%. Unfortunately the employer match has been suspended until further notice due to the covid crisis.
I wound up selling my share of BIGC because I had read some articles discussing the share price being over valued and predictions of a massive decline in the share price. I wound up selling at 110.09 which isn’t a bad profit since I purchased it at 72.81.
I took that and added it to some dry powder I had sitting in my brokerage account to pick up a share of apple for 132.91 after the apple stock split but the share price started tanking right after I opened my position. I didn’t want to see all of my BIGC profit vanish so I sold AAPL at 122.99… it’s currently at 113.60 at the time of this writing.
I decided to take that and what I had left sitting on the sidelines in my brokerage account and purchased shares of BRG which is a REIT stock that pays an annual dividend of $.65 per share. I opened a position and purchased 23 shares at $7.56 per share. It’s time to start building that passive income portfolio.
I just added 7 more shares of BRG at $7.33 per share after adding the $55.00 to my account to make an even 30 shares.I’ll probably start picking up 1-2 shares a payday from this point on to add to that position. I’m researching some other stocks I’d like to open positions on in the coming paydays.
I’m not adding to the acorns account on this payday.
Be sure to keep track with me and if you’d like, share your payday plan in the comments section below.
Until next time… be sure to comment below and let’s get some dialogue going.
“Spend each day trying to be a little wiser than you were when you woke up”
– Charlie Munger –
How do people become wealthy? Well, I’m about to go over five methods that you can apply towards building wealth that are used by people already where you want to be. It’s not enough to just manage your money like the rich, you need to have methods in place to get there in the first place.
Establish a money tracking system.
If I were to ask you where did you spend your money last month, do you have an exact answer? Without having an understanding of how you spend the money you have now, it becomes difficult to make and manage more.
Developing the skill of overseeing money will not only help you manage the money you have now, but when the time comes to manage more money you will have the skills in place to make intelligent decisions.
The best way to keep track of your money transactions is to place them into three main categories:
Income: Everything that generated you money for the month. This includes your job, any side hustles and/or business income.
Living expenses: These are recurring expenses such as rent/mortgage, monthly bills and food. The basic necessities that you need to survive.
Other expenses: These are things that are considered luxuries such as a streaming account, daily cups of coffee from places like starbucks, fast food and other expenses that are not necessary.
2. Develop the discipline of saving money.
It’s not shocking to know that the wealthy are very dedicated to putting money away. It doesn’t matter how much money a person makes if they spend it all as quickly as they earn it. The key to building wealth isn’t about how much you make, but how much of it that you keep.
As you might know, I’m a huge advocate of the richest man in babylon mindset of “A part of what I earn is mine to keep” and the pay yourself first philosophy.
Saving money is the foundation to building long term wealth. Especially for when unexpected expenses arise… you should have something put away in case of an emergency.
Statistics show that 57% of Americans have less that $1000 in their savings accounts and 39% have no savings at all.
Saving money can be challenging, but there are a few ways to do it.
The first way is to automate your savings. Many savings accounts allow you to schedule transfers from your main bank account to your savings account as soon as your paycheck arrives. Become a (richest man in babylon) fanatic like myself about paying yourself first before any of your other expenses.
Another method is to have your savings account with a completely different financial institution than your main bank. Not a checking account with a debit card, but just a savings account, preferably one that pays the highest interest on your savings that you can find. Those type of savings accounts are typically online banks.
The purpose of this is that it makes accessing your savings more challenging and makes it easier for you to keep it. It usually takes 2-3 business days for an electronic money transfer to take place so you’re less tempted to tap into your savings for an immediate purchase.
Just to be clear, having money saved doesn’t make you wealthy, even if it’s a large amount. Saving money is just the first step. There’s a difference between having cash and having equity.
Here’s another question for you. Would you rather have a million dollars in cash or a million dollars in real estate and/or good companies? The rich prefer that latter.
Cash is just that… cash. If you save a million dollars and don’t spend any of it, ten years later you’ll still have a million dollars. And when you factor in inflation, that million dollars loses purchasing power over time.
But chances are that a million dollars in equity of real estate and/or good companies in ten years will be worth much more than it currently is today.
3. The wealthy invest their capital into money-generating assets.
As I previously mentioned, saving is just the first step. The rich don’t save just for the sake of saving, they use that money to build long term wealth. So once you have a system set up to consistently save money, it becomes time to use this system to multiply the money. Money working for you to make more money is the goal.
Think of the game Monopoly. The game is about who owns the board, not who has the most money. You don’t win the game just by holding cash. The goal is to spend the cash to own the property that generates income. In the end, the one who owns the board ends up with all the cash anyway.
So which would you rather have? Money saved earning a minute percentage that looses value over time or a money-generating machine? The rich use money to build or purchase a money-generating machine that creates passive income.
This is why the wealthy don’t have to work for money. They understand that creating passive income allows them the benefit of putting their time to better use by not having to work for an income.
4. Most wealthy people live below their means.
Contrary to popular belief, most people with real wealth live below what they earn. This is especially true at the beginning when they haven’t amassed their wealth yet.
Research shows that wealthy people have a history of being quite frugal with their money. Many did not buy the expensive cars and mansions even when they were making a decent amount of money.
There are people who make six and seven figure incomes annually who buy all the luxuries and spend most of their money. However, the people who actually get wealthy have a bigger picture in mind. They aren’t looking to make a couple million, they are focused on accumulating massive wealth. So many of them continue to spend money like the average person.
The idea is to get used to not needing much in order to build long term wealth, even as your income grows. This is a very powerful strategy to employ as business and economic cycles go up and down.
So, as we begin to track our finances, build a savings and invest that saving into money-generating assets, there is one more thing the rich do so that they never run out of money.
5. Spend the residual, never the principal.
Most people start off with active income, the money we spend time to make. Once you start investing into income-generating assets, you then start earning passive income which is the cash flow that your assets produce.
The difference between the wealthy and the rest is that those building real wealth only spend the cash flow their assets produce, not their hard earned money.
it’s like planting a fruit tree, most people eat the seeds before planting the tree. Whereas the wealthy plant the tree first and only eat what the tree produces. Many wealthy people still maintain earning an active income, the difference is that they use their hard earned money only to invest and only buy luxuries with the money that their investments have produced.
That is how they make sure that they never run out of money, even when buying expensive luxuries.
So, what is a good practical step to take on your journey to building wealth?
As mentioned above, in order to begin investing, you need to save. In order to save, you must lower your expenses or increase your income.
These strategies may seem simple, but simple means nothing without discipline. As I’ve mentioned in previous posts, discipline is a key principal to achieving financial freedom.
As I like to say… “the journeybegins with the first step”.
If you see value in this article then please be sure to like and subscribe to the blog if you haven’t done so already. I’ll be putting up more wealth building posts in the future and you can have them delivered straight to your email account.
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I’ll see you in the next post. Until next time… be sure to comment below and let’s get some dialogue going. I’m curious to know, what’s your opinion on wealth building strategies?
“Be not afraid of going slowly. Be afraid only of standing still”
– Chinese Proverb –
Let’s face it, we all dream of living “the good life” of financial freedom. The unfortunate fact is that most people won’t ever get to that point in life because they were never taught financial literacy. Not only that, society has been conditioned to believe that taking short cuts to “get rich quick” is the ONLY way to achieve financial freedom. The reality is that unless one has been fortunate enough to be born into wealth, most wealthy people achieve their status over time by being financially disciplined and meticulous planning.
But before we go any further, let’s define the term.
Slow FI: When someone utilizes the incremental financial freedom they gain along the journey to financial independence to live happier and healthier lives, do better work, and build strong relationships.
The journey to financial freedom is exactly that… a journey and not a race. If you haven’t done so already, it’s imperative that you start investing now so that your wealth portfolio has time to grow and use compound interest in your favor.
Don’t be fooled into believing that you can put it off until later because you’re young. That’s the ideal time to start! Building a wealth portfolio should be done meticulously but also enjoyable. Adding money each payday and watching it grow over time should be as much of a priority as paying down debts each month. And once you’ve achieved debt freedom, the money put towards those debt payments should then be put towards your wealth portfolio.
If you’ve read any of my other posts then you should know that I’m an advocate of the “richest man in bablylon” philosophy of paying yourself first regardless of your debts and putting that money to work for you. I’ve disciplined myself to do this and I implore you to do the same. I know I sound like a broken record by always repeating this, but repetition is one of the keys to learning and forming habits.
We live in a quick buck society with instant gratification in high demand. But the reality of it all is that many people are managing to just get by pay check to pay check if even that. They dream big but often take no action and later in life have no financial reserves to fall back on.
As a reader of this blog, my goal is to help you avoid that lifestyle. I’m dedicated to getting this philosophy out and influence the counter culture belief that it’s okay to build wealth slowly and enjoy life in the process.
Dave Ramsey has a saying that goes like this “live your life today like no one else, so that you can live your life tomorrow like no one else”. It’s a very simple concept, yet so enlightening.
As I take this journey of building wealth from scratch slowly, I’m documenting it with my payday post plans. I post these every other Friday which consist of how much I’ve paid myself and how I’m applying those funds to my wealth portfolio. I take screen shots of my investment accounts and post them as proof.
So you see, I’m following the principle of SlowFi wealth building because I believe in the principle of practicing what I preach.
As I like to say… “the journeybegins with the first step”.
If you see value in this article then please be sure to like and subscribe to the blog if you haven’t done so already. I’ll be putting up more wealth building posts in the future and you can have them delivered straight to your email account.
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I’ll see you in the next post. Until next time… be sure to comment below and let’s get some dialogue going. I’m curious to know, what’s your opinion on slowfi wealth building?
“The number one problem in today’s generation and economy is the lack of financial literacy”
– Alan Greenspan –
Looking back at my early years, I wonder why it was required that I had to study things like social studies and world history when in fact none of what I was forced to study has any value to my adult years in life. Yet the ONLY financial class in high school that I recall offered was accounting, and that was an elective so it wasn’t required learning.
It really miffs me to know that so many people in society have very little, if any, financial knowledge other than how to balance a checking account. And some people can’t even do that correctly! A huge chunk of banking profits come from overdraft fees.
Our education system is broken and too many kids are entering into adulthood without the real world knowledge that they need to be financially successful. Not only that, they aren’t encouraged to pursue entreprenuership endeavors, but instead indoctrinated into the belief of “get a good education to get a good job”.
Also, kids are led to believe that going into student loan debt of tens of thousands… if not hundreds of thousands of dollars is justifiable to become wage slaves dependent on employment. It isn’t until they graduate from college and attempt to enter the workforce that the reality of loan repayment sets in.
Then if they’re even fortunate enough to find a job in the field that they pursued an education in the first place is questionable. Often they have to settle for a job that they could’ve gotten without going to college in the first place. Oh, and those student loans still have to be paid back and can’t be charged off in bankruptcy!
Once they’ve entered the workforce they are now dependent on their employer for that after tax deducted paycheck. It’s rare that the youth think to put money aside in case of an emergency for unexpected expenses. And lets face it, retirement planning and managing their money like the rich isn’t a top priority for most twenty somethings.
So they’ve started their key working years in debt with student loans. Then there are cost of living expenses such as rent/mortgage payments, utilities, food and transportation to factor in. Typically credit card debt has accrued at this point as well. Credit card companies target students for good reason… they tend to have limited finances.
By the time the desire to build wealth sets in, they’re thousands (often tens of thousands) in debt and have limited, if any money left to put towards that goal. That’s when they turn to the advice of “financial gurus” who never seem to advise them to ALWAYS pay themselves first with the mantra “part of what I earn is mine to keep”. But instead they’re told to get out of debt and then invest in mutual funds that earn 7% (magically in guruland) annually.
Financial literacy is something that we can’t afford to not be teaching/learning. Since we can’t rely on the education system to make it required learning, we have to make it required learning for ourselves. I implore you to make this a priority in your life and encourage everyone that you know to do the same.
The reason I started this blog was to connect with people who are in pursuit offinancial knowledge and building wealth. Especially those who want to do so but can’t either because they are drowning in debt and/or have limited funds to do so.
The world is on the verge of bankruptcy and financial collapse. We as a society need to purge the consumerism obsession lifestyle out of us and make financial stability our mission. The societal financial safety nets of social security and medicare are unsustainable. Social security was never meant to be the sole source of retirement funding, but a supplement to it.
As unemployment surges and people have no financial reserves, they are turning to government assistance programs which are strained and reliant on tax revenues for funding. Food banks are maxed out and charities can only give so much.
So, let’s focus on solutions and strive to teach those willing to learn. Let’s be the change we want to see in the world by forging the path to financial freedom and lift up as many as we can a long the way.
As I like to say… “the journeybegins with the first step”.
If you see value in this article then please be sure to like and subscribe to the blog if you haven’t done so already. I’ll be putting up more wealth building posts in the future and you can have them delivered straight to your email account.
I’ll see you in the next post. Until next time… be sure to comment below and let’s get some dialogue going. I’m curious to know, what’s your opinion on teaching financial literacy?
building wealth 