Why do you elude me when I need you the most? Is it because I spend more than I save? Or is it because I have champagne taste but a beer pocket? Maybe I can just use the economy as my scapegoat?
You probably have an array of reasons why you or your business is cash poor. Maybe you spend too much, make too little, went through a rough patch, or simply don’t know how to say no.
What it probably boils down to, though, is poor (or no) financial planning. Good financial planning will help you succeed and potentially live a good life. The question remains, can you live a great life without money? Perhaps, if you’re deserted on island and no one exists, but let’s get real; you need it to survive and thrive more often than not.
As of late, everyone seems to talk about money (or the lack of it), and this shouldn’t be the sole objective of our lives. However, at the end of the day, everything we do involves money (most of our life is dedicated to get it). So if you want to survive in today’s world, you must plan for your (or your business’s) future. Never live day-to-day thinking tomorrow is going to be okay, always plan for the worst. When worst actually hits, it will be a minor bump in the road. Having financial freedom will help your stress levels decrease and can put your mind at ease. Recessions are looming and scary, but a love for economics has shown me that on average the pain lasts eleven months. So with an emergency fund and a good financial plan, you can still insulate yourself better than an attic!
Here’s a favorite resource to get you started.
Now go make some paper and save some if it, too!
-SM
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Definitely. I’d have to say financial security is not so much about how much you make, but what you do with your money. Coming from a poor family, I now realize that my single mother made less than $20K annually, but she made some very good financial investments, and boom! She now has her own business and is doing very well. Saying “no” is also something we must all learn at times. We live in a consumer economy that continuously teaches us to consume, consume, and consume some more. Not going out one night did not hurt anyone.
People are always spending money that they don’t have. Relying on credit cards is never a good thing, unless you have the financial capability to pay it back before the interest kicks in. Especially now that we are in a recession, credit card companies are hiking the interest rate if you haven’t noticed already. And yes, they can do it because it was on the contract/agreement that you signed. Not reading a contract agreement is not a defense to prevent credit card companies from applying the rate they desire, but that is another issue.
Always be smart with everything you do. Be smart with your money. Save, but don’t just leave it sitting in a safe at your home. Make your money grow. Teach yourself how to be a smart investor. Don’t rely on others. If you want something done right, it’s best that you do it yourself.
I find that the single most important variable that determines one’s level of wealth is values. Values will drive us into a chain of actions that will lead us to a state of poverty or wealth.
For example, one of my friends, lets call him Tom, goes on vicious spending sprees every week, never failing to raise my eyebrow on the price tags. After inquiring him about his habitual trips down consumption avenue, he told me that he believes money is dirty and that it should leave his hands as soon as he gathers it. I would image such a perspective is uncommon, however this is a clear example of how values can drive wealth levels.
I happen to be on the other side of the spectrum. I value future financial freedom more than the current fashion trends. I rather have several thousand dollars in the form of capital than a new model car. The values therefore would drive to save and invest.
Whether or not my lifestyle is superior to Tom’s is not only irrelevant but a matter of perspective, and therefore inconclusive. What is certain, however is that the probability of my being wealthy in the future is higher than Tom’s, given that our earning capacities are equal. However, this is still a probability and life can throw in many variables.
- YxK
Money is a means to an end, not an end in and of itself. To answer the question, “Can you live a great life without money,” as Young previously mentioned, it all boils down to what we value. What motivates us? Whether it is power, prestige, respect, or merely the size of our paychecks, we must evaluate our values in order to answer this question.
First and foremost, money should not be the bane of our existence. There is nothing inherently wrong with possessing money. It is when money (moreover, greed) possesses and consumes us that we must reconsider our actions and regain perspective. Big house, nice car, extravagant vacation…there is nothing wrong with working for, or better yet, saving for, any of these things. However, we must keep in perspective what they are costing us because, more often than not, the sacrifices we make in order to gain them are costing us much more in the long run.
Granted, owning nice things and not having to worry about the green inflow can certainly contribute to one’s happiness and sense of well-being. However, as most of us have experienced, the rewards are insubstantial and quite often, short-lived. We set one goal after another; each time, the bar set just one or two notches higher than the previous. Unfortunately, this is inevitable and quite possibly a necessary evil to push us to our limits and drive us to success. Yet, before long, we find ourselves in our forties and knee deep in a mid-life crisis.
So what real question is: what do you value? Know what you want and why you want it. Actively pursue it with appropriate, tangible and realistic goals in mind. For what it’s worth, in my opinion, the greater things in life tend to cost much less than we think. Let’s not cheat ourselves by making money and happiness one and the same. There is more to life than money, money and more money.
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