4 Things To Do To Be Rich in Life!
Adults of all ages struggle with money management skills. The topic can seem complicated and downright boring, yet these life skills are essential to building a strong financial future, whether you are 20 or 50.
We live in a culture of consumption. #MOREMOREMORE. We tend to use, throw out and replace items quickly. New cars, phones, and electronics come out each year, and we have an insatiable need to have the newest thing. This fact drives the economy, but also puts a strain on many household budgets. It can be hard to resist the latest and greatest, even if the improvements are slight.
The result of heavy consumption is overspending from an early age. Those who develop the following traits are more likely to resist overspending, live within a budget, and build a stable financial future. They understand that in order to use their money for something important, it takes some sacrifice on their part. They save and wait until the time is right to make major purchases. They keep an eye on everyday spending to ensure there is enough for the things that matter. People with strong money management skills achieve their financial goals faster. A few ways to learn strong skills is to develop strong traits:
Delay Gratification.
- We live in a time where everything is fast. Snail mail, moved to email, which moved to instant messaging. You can communicate in multiple forms in an instant. Faster communication has sped up a lot of services. We want loans “instantly.” Credit card decisions within “60 seconds.” Bring home the Television today and take 6, 12 or 18 months to pay. All these promotions have trained us to get it today and fund it tomorrow. There is power in waiting. Often those impulse buys bring very little satisfaction. When you look at the $5,000 you owe the XYZ bank, can you remember what it bought? Probably not. It seemed important at the time. It was a great sale, need, or whatever emotional tug that resulted in a purchase. Most people are unwilling to gain patience for something better. Train yourself to wait for things. If you are hungry, drink water and wait 30 minutes. You see a great outfit, sleep on it before making a purchase. Developing patience will save you money and help you regulate your emotional spending in a positive way.
Have a Long Term Goal.
- This allows you to think and plan ahead of time on how you will achieve it. This practice also helps develop patience because you can compare the impulse buy you’re your long term desires to resist spending. Working on any long term goal right now will help you focus on the road ahead even with all the bumps that come with it.
- For example: If your goal is to be a commercial pilot you must graduate with a bachelor’s degree, practice over 1500 hours of flying time taken at a flight school, log an additional 250 hours which include day and night time flying, and pass the FAA aviation exam. You only have 24 hours in a day and every time another activity demands your time, you must choose to advance you a goal or re-direct your attention elsewhere. The more often you are distracted, the longer it will take to obtain the pilot license. Money is the same way. You currently have a certain amount of money you earn each month. You also have things you want to buy, investments to make and trips to take. Every time you get distracted and buy something that does not further the long-term goal; it takes longer to get where you're going. When the weeks turn into months and months turn into years, you may find you are middle age or staring down retirement without enough in the bank to cover the costs. When you don’t think ahead about long-term goals, there is no direction for your income. You pay for things as they come up and before you know it there is nothing left. When unexpected costs arise, as they always do, you don’t know how to deal with them because you didn’t prepare for it. Let your long term goals guide your spending decisions.
Doing Volunteer Work!
- Volunteering allows you to help others and see life from another’s point of view. Everyone grows up in different circumstances and have different experiences. Volunteering allows you to see life from another angle and will help you appreciate what you have. Changing the way you view the world will help you establish priorities instead of getting caught up in non-productive routines.
Control Spending.
- The saying goes, “A successful man is one who can make more than his wife spends.” There is truth to this old saying (even though it’s certainly outdated), in the sense that financial success hinges on the ability to spend less than you earn. It’s a simple concept that can be hard to follow with the drive towards financing everything from cars to cell phones. Patience and self-control are a critical element to saving money. Compare temptations with your priorities and long-term goals to decide when to buy and when to pass. When you begin to make conscious decisions about spending, you will find many things you purchase are wants rather than needs. The more patient and self-control you have over your spending, the more likely you will invest and have money for future needs.
Pay attention to spending, delaying gratification, setting long term goals and volunteering are all strategies which develop strong money management skills that will last a lifetime. Your children, no matter what age, will see you working towards your goals and will help them develop better financial skills at a younger age. It is not how much you earn that determines your financial security, but how much you are able to keep, despite all the pressures to overspend.
Ryan Sasson is the CEO of Strategic Financial Solutions. He co-founded the company in 2007. A native New Yorker, Ryan has almost two decades of experience starting and growing businesses in the region. Before founding Strategic, Ryan was the president and founder of Timberline Capital, one of the largest Merchant Cash Advance companies in the country. Ryan is a member of YPO Metro and in involved with multiple charitable organizations. Ryan holds a Bachelor of Science in Business Marketing and Business Management from Tulane University and is currently enrolled in the Presidents Program at Harvard Business School. Connect via LinkedIn