General

the secret to money the wealthy know (and you don’t)

Well, maybe.  But maybe not.  See, the problem is that by spending that money now, you negate spending more of it later.  Because you want the nice clothes and latest iPhone and best Crossfit membership, you are more than likely skimping on funding your retirement or building your emergency fund or saving to put 20% down on a house.  And you know what that means? It’s costing you extra money. And potentially YEARS of retirement.

Think of it like this:  all that money you’re spending on rounds at the bar could have been thrown into savings and used as an additional down payment on your home.  Now, however, instead of putting down 20% to get a lower interest rate and avoid PMI (i.e. things that will save you serious cash), you can only afford 10%, meaning you are losing thousands every year that those of us 20%-ers don’t have to worry about. 

Or, let’s say you haven’t quite gotten around to building an emergency fund. No big deal…until your company gets acquired, and suddenly you lose your job with nothing to fall back on. You end up having to take a job just to pay the bills, but damn, do you hate it.  Out of nowhere, you’ve found yourself in a situation where you dread going to work in the mornings and are maxing out your credit cards just to stay above water. Sucks, right? It’s more common than you think.

If you truly want to “have it all,” you need to become a master of delayed gratification, meaning you have to be willing to give up a little now in order to get a lot later.  I know, easier said than done, but it’s a habit that can be learned.  And coming from someone who knows, the promise of financial stability and more “fun” money down the road is definitely worth it. All it takes is a little willpower.  And I’m here to show you how to develop it.

SET GOALS THAT SUPPORT YOUR “WHY”

You know which are the easiest promises to break? The ones you don’t care about.  And the same thing goes for your goals.

If you don’t set a worthwhile financial goal, there is no way you will sacrifice your wants and needs now for your wants and needs later. Yes, we can all say we’d like to be debt free, but honestly, the promise of nixing a $300 monthly payment doesn’t really make sacrificing our current Thursday night happy hours or weekly personal training session very worthwhile. 

That’s why you need to figure out your “why.” Why it’s important to reach your goal. Why you want to be on better financial footing. Why giving up your time and energy now will be worth it down the road.  For instance, let’s say your goal is to pay off debt. Great. I’m all for it. But if that’s where you leave it, you’re not going to find the motivation to stick with it. You need to figure out the root cause behind why you want to free up your cash.  Is it to use that extra money to save for a house so you can expand your family? Finally take a honeymoon? Just be able to go out to dinner and buy a pair of shoes without feeling guilty?  Whatever it is, make it something you are 100% behind and ensure that reason is the focus of your efforts.

SET REMINDERS

Day to day life can sometimes get in the way of our long-term goals.  You get last minute invites to happy hour after a stressful day, opportunities to donate to a friend’s charity, or find a really expensive pair of shoes on sale and all of a sudden, you’ve blown your budget.  Again.

That’s why setting reminders of those long-term goals is so important: it keeps you focused on the end goal.

Here’s what you need to do: change your desktop background to a picture that represents your why.  Do the same for your phone.  Put an actual photo up somewhere in your house or in your wallet next to your credit card. Heck, even set periodic reminders on your phone.  These little reminders will keep you on the straight and narrow, and when you pass by those boots you’ve been eyeing at Nordstrom, you’ll have a much easier time walking away.

AboutKara

I’m a writer, new mom and foodie. I love sharing what I know while making others feel beautiful. On this blog, I share my healthy lifestyle, simple meals, fitness tips and experiences.

Leave a Reply

Your email address will not be published.

Kara Bout It