We all want financial freedom, or at least, to be less stressed about money, right? And we want it without making our quality of life worse. Scrimping and saving every penny is just not desirable, so how can you succeed with money in a pain-free way?
To succeed with money, there are three main areas to focus on: minimizing your spending, maximizing your income and maintaining good financial management.
Let’s take a look at the 3 cardinal rules to succeed with money.
Rule 1: Habit-stack to succeed with money
“You don’t have to be a miser, just be wiser with your money” – Dorethia Conner Kelly
You’re about to embark on a sweeping life change to achieve financial success. The beginning is always the most difficult part as it takes an average of 3 weeks to break a habit.
The great news is that once you break your poor financial habits, you will be on the road to personal finance mastery.
Our advice is to make incremental changes. This way, it is not too sudden a change and you can stack new personal finance habits in a gradual manner.
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Rule 2: Think long-term
“It takes as much energy to wish as it does to plan” -Eleanor Roosevelt
It’s human nature to think in the short-term, a legacy from our hunter/gatherer ancestors who had to search for food and other resources daily. Fortunately we don’t live like that anymore. Why is long-term thinking with money a good idea?
- You will spend less
Buying food every week is more expensive than a monthly jaunt to the grocery store. Another common, expensive cost comes from higher purchase buys, which usually wind up costing much more than an upfront payment. Thinking long term with your financial goals in mind, and you will see significant savings.
- Your retirement needs you to
62 per cent of Americans are expecting to delay their retirement age due to a lack of savings and a failure to manage their money better. Why? One reason is because of short-term thinking. The YOLO – You Only Live Once – trend is partly to blame, which encourages you to forego planning for tomorrow.
- You absolutely need an emergency fund
Most people just don’t think of a potential rainy day fund to cover emergency needs such as paying a medical bill or covering house or car maintenance costs.
You can start to think long-term by writing down your financial goals and focus on how to reach them. Aim to minimize larger costs by avoiding places that would otherwise encourage you to splash the cash. But, importantly, it’s ok to splurge every once in a while, within your budget. After all, it’s part of the spice of life.
Rule 3: Think BIG
“Don’t save every nickel. Invest in yourself” -Henry Ford
You don’t need to scrimp and save every penny to succeed with money. Keep getting that Starbucks! Would becoming ultra frugal help? Sure, of course it would – you’ll be spending less money after all – but at what cost? Your quality of life will go down and really, the difference won’t be all that big.
What you can do is ensure spending is moderate and turn your focus to ways of increasing your income. You can ask your boss what you can do to get a raise, increase your earning power with new qualifications, and look at how to generate multiple revenue streams (moonlighting, developing passive means of income, consulting, and investing, among other methods).
The final word
Following these 3 rules will bring you greater financial freedom. They do however require commitment and discipline, especially in the beginning, but will help lead you to succeed with money. To get a kickstart and really get your financial house in order fast and primed to perform, download our free, award-winning app below!