Financial freedom is something which anyone who is old enough to understand the value of money wishes for. Yet, in spite of this, only a small portion of the population actually succeeds at personal wealth building and the establishment of financial freedom and security. If you’re interesting in knowing the key differences between those who succeed and those who struggle, that’s what this article is going to cover.
Financial Freedom Can Only Happen On Purpose
Are you what people might consider to be a “tightwad” when it comes to the way that you manage your money? You know what I’m talking about, a nerd who lives on a written financial plan and who keeps track of what they earn and what they spend. If not, it’s time to stop caring about what people say about being a nerd or a tightwad and it’s time to start living like one. Remember in school when the kind who got straight A’s was picked on as a nerd or a teacher’s pet?
This doesn’t change as we progress into adulthood, it’s called the punishment of achievement and it’s done out of jealousy. You need a clear and written financial plan that gives you a clear picture of how you’re earning, how you’re spending and what your plans are for increasing your earning and gaining control over your spending.
The Foundation of Your Plan for Financial Freedom
Before you develop your clear and written plan for becoming a financially secure and wealth “nerd,” the first step is to determine what’s most important to you. In other words, what is your long term financial goal: to purchase (not mortgage) your own house? To retire in 20 years? To start your own business? Once you have this established, you make a “no matter what” commitment to invest in that before you do anything else.
People who never achieve their financial goals do it because they pay their living expenses before paying themselves. The mindset is that once they achieve financial security (most of the time by earning more money or “getting ahead”), that they’ll start making their goals a priority. This is the most certain way to never read your goal. Determine what’s important to you, and make it the #1 priority, even before you pay your expenses.
The Most Important Principle of Personal Wealth Building
Once you’ve set your priorities for how to spend and invest your money, make every financial decision with this question in mind: “Will this decision add value to my goal for financial freedom or to someone else’s goal?” Ask this simple question every time that you make a purchase from now on. As simple as this might sound, it will help you to gain control over your spending and to stick with your plan for achieving financial freedom.
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