Last night as I was teaching a budgeting class, I was reminded how much your income really is your greatest wealth building tool. Did you know that the average annual income in this country is right around $50k? That means that for the average working adult making an average income over the course of a 40 year working lifetime will have about 2 million dollars pass through their hands. 2 million dollars! Imagine how much more that is when you make more. That's a lot of money to go through and have nothing but Social Security to live on. I don't know how many retired or nearly retired people I've met who look back at their financial lives with deep regret of what could have been.
If the money comes in on payday and then all goes right back out in the form of payments, will you really be able to effectively reach your goals? Even after the great financial losses of 7 years ago, today's world is still one of easy credit. Banks advertise, "If you have the dreams, We have the money!" That's the irony of it. Have you ever noticed the skyline of just about every city in America? It is dotted with big, tall buildings, even skyscrapers. In nearly every case, those skyscrapers are owned by banks. They make billions and billions of dollars annually all because we as a culture are not willing to save up to buy things ourselves. Instead we use their money and build their wealth, not our own.
So my advice today is to stop. Stop borrowing money to finance your "dreams". Stop mortgaging your future on the whims and fancies of today. There is great satisfaction and peace in saving up and paying for something with your own money. Cars drive differently. Furniture feels better. The grass truly looks greener when it doesn't have a payment attached.
Showing posts with label Patience. Show all posts
Showing posts with label Patience. Show all posts
Thursday, June 11, 2015
Monday, August 5, 2013
Are Student Loans Really Worth It?
If you read this blog or know me at all, you know that I always am advocating for avoiding debt and paying it off as quickly as possible if you do have it. Student debt is no exception in my book. Other 'financial advisers' and even friends and family will justify it with you as 'necessary' or an 'investment in your future'. While that might be true with regards to getting an education, the debt so easily taken on is not. I came across an article today citing a study verifying the fact that it makes you poorer than those who do not get student loans.
When you get student loans, most of the time all you think about is how much it will end up costing monthly over the life of the loan. What you fail to take into account is what it does to your overall financial picture. It ends up being much bigger of a toll than how much you end up paying. For instance, what do you lose by making those payments instead of investing more in retirement or a house? Suddenly, you realize that you're not just losing what you're paying out every month, you're losing hundreds of thousands of dollars in compound interest over that time. When you look at things in this light, I don't know how you could go through with it, no matter how much you want it or think you need it.
Now that you are sufficiently sick about that, let me remind you about some of the other pitfalls of student loans. Student loans aren't like ordinary consumer debt. They are with you forever, until paid or you die. Period. They are in the same class as IRS debt because they survive bankruptcy. Another huge thing to consider is that you might not finish college or your graduate degree. Nearly half of all undergrads drop out before completing their degree and an even smaller number actually finish on time, costing much more as well. Graduate degrees don't fair much better. Even in fields with the lowest drop-out rates 1/3 still don't finish. If there's anything worse than having a pile of student debt, it's having that debt AND no degree to go with it.
For these reasons, don't go into debt for an undergraduate degree. If you want to seek a graduate degree, be creative with how you pay for it. Find a company who offers tuition reimbursement. If you want to go to medical school, did you know the army will pay for every penny? This is with the condition that for so many years afterward you'll work for them at a reduced pay. I think that's definitely worth considering for $250,000 of free tuition.
Sometimes it even means you delay your education goals. I have some rock star friends who are currently cash-flowing an MBA program. Instead of just going into $60,000-$80,000 in debt, they planned for it for many years. They lived super frugally while they had 2 incomes and continued when they had their first child and she stayed home. We're talking no eating out, no cable, no internet at times, no expensive shinny new cell phone plan, shopping at thrift stores, minimal gifts, etc. As a result, they bought a house on a short sale with a sizable down payment, fixed it up, and lived there for a few years. When they were ready to go for it, they sold the house, moved into an apartment (with 2 almost 3 children) and are using the money to pay for school. They have completely broken the mold on this subject, but are reaping the benefits of being so. Their sacrifice and hard work in the short term will make them multi-millionaires in the long term.
Personally, I know how hard it is to resist using student loans for easy money. I also know how hard it is to pay them off. When my husband graduated from college nearly 10 years ago we had almost $14,000 of student loan debt. This might not seem like a lot compared the national average, but it was hard for us. We were broke. It took him 6 months to find a job in his field, which he then lost 4 months later and then was unemployed for 4 1/2 months. It was a very stressful time, but we battled through it and continued to make the minimum payment. Over the next few years we made the mistake of going into more debt. We bought a car, had our first child and bought a house stretching us even further. By the time we got our act together, we still owed over $10,000. But, by the time we were aggressively attacking it, we paid off the last $8,900 in just 10 months. As an added curve ball, a few months into those 10 months our house flooded and we had an insurance deductible to pay for. So we ended up selling our second car to get us back on track.
My point in telling you both of these stories is to give you encouragement that it can be done. Whether you have $10,000 in student loans or $100,000- KEEP GOING! Work extra jobs, cut back as much as you can. Sacrifice, hard work and above all patience will always pay big dividends down the road.
So what's the bottom line? If you don't have student loans, don't get them or certainly don't take them on lightly. If you already have them, get on a plan to pay them off as soon as possible. Don't be lulled by tax deductions and low interest rates. It's always worth it to work as hard as you can to pay them off quickly. I have coached couples and have friends and family from both ends of the spectrum and have seen the heart ache that comes from student loans, and triumph that comes from a lack thereof.
I leave you with a few things to consider if you are still considering taking out student loans:
1-Think long and hard about it. Maybe the timing is not right.
2- Make sure you get that degree.
3- Know that it will stunt your financial potential to some degree.
4- Don't get a case of 'Docitis'. After you graduate and get a job, live like you're still a broke college student and plow through those loans as fast as you can. This means no fancy cars, vacations and house. The faster you can get them paid off the faster you can get your future back on track.
When you get student loans, most of the time all you think about is how much it will end up costing monthly over the life of the loan. What you fail to take into account is what it does to your overall financial picture. It ends up being much bigger of a toll than how much you end up paying. For instance, what do you lose by making those payments instead of investing more in retirement or a house? Suddenly, you realize that you're not just losing what you're paying out every month, you're losing hundreds of thousands of dollars in compound interest over that time. When you look at things in this light, I don't know how you could go through with it, no matter how much you want it or think you need it.
Now that you are sufficiently sick about that, let me remind you about some of the other pitfalls of student loans. Student loans aren't like ordinary consumer debt. They are with you forever, until paid or you die. Period. They are in the same class as IRS debt because they survive bankruptcy. Another huge thing to consider is that you might not finish college or your graduate degree. Nearly half of all undergrads drop out before completing their degree and an even smaller number actually finish on time, costing much more as well. Graduate degrees don't fair much better. Even in fields with the lowest drop-out rates 1/3 still don't finish. If there's anything worse than having a pile of student debt, it's having that debt AND no degree to go with it.
For these reasons, don't go into debt for an undergraduate degree. If you want to seek a graduate degree, be creative with how you pay for it. Find a company who offers tuition reimbursement. If you want to go to medical school, did you know the army will pay for every penny? This is with the condition that for so many years afterward you'll work for them at a reduced pay. I think that's definitely worth considering for $250,000 of free tuition.
Sometimes it even means you delay your education goals. I have some rock star friends who are currently cash-flowing an MBA program. Instead of just going into $60,000-$80,000 in debt, they planned for it for many years. They lived super frugally while they had 2 incomes and continued when they had their first child and she stayed home. We're talking no eating out, no cable, no internet at times, no expensive shinny new cell phone plan, shopping at thrift stores, minimal gifts, etc. As a result, they bought a house on a short sale with a sizable down payment, fixed it up, and lived there for a few years. When they were ready to go for it, they sold the house, moved into an apartment (with 2 almost 3 children) and are using the money to pay for school. They have completely broken the mold on this subject, but are reaping the benefits of being so. Their sacrifice and hard work in the short term will make them multi-millionaires in the long term.
Personally, I know how hard it is to resist using student loans for easy money. I also know how hard it is to pay them off. When my husband graduated from college nearly 10 years ago we had almost $14,000 of student loan debt. This might not seem like a lot compared the national average, but it was hard for us. We were broke. It took him 6 months to find a job in his field, which he then lost 4 months later and then was unemployed for 4 1/2 months. It was a very stressful time, but we battled through it and continued to make the minimum payment. Over the next few years we made the mistake of going into more debt. We bought a car, had our first child and bought a house stretching us even further. By the time we got our act together, we still owed over $10,000. But, by the time we were aggressively attacking it, we paid off the last $8,900 in just 10 months. As an added curve ball, a few months into those 10 months our house flooded and we had an insurance deductible to pay for. So we ended up selling our second car to get us back on track.
My point in telling you both of these stories is to give you encouragement that it can be done. Whether you have $10,000 in student loans or $100,000- KEEP GOING! Work extra jobs, cut back as much as you can. Sacrifice, hard work and above all patience will always pay big dividends down the road.
So what's the bottom line? If you don't have student loans, don't get them or certainly don't take them on lightly. If you already have them, get on a plan to pay them off as soon as possible. Don't be lulled by tax deductions and low interest rates. It's always worth it to work as hard as you can to pay them off quickly. I have coached couples and have friends and family from both ends of the spectrum and have seen the heart ache that comes from student loans, and triumph that comes from a lack thereof.
I leave you with a few things to consider if you are still considering taking out student loans:
1-Think long and hard about it. Maybe the timing is not right.
2- Make sure you get that degree.
3- Know that it will stunt your financial potential to some degree.
4- Don't get a case of 'Docitis'. After you graduate and get a job, live like you're still a broke college student and plow through those loans as fast as you can. This means no fancy cars, vacations and house. The faster you can get them paid off the faster you can get your future back on track.
Tuesday, July 30, 2013
Being Patient
Yesterday I made the mistake of going over different scenarios from past financial decisions had my husband and I made different choices. The results made me sick. I could do nothing but shake my head at the what ifs. Now it's all hindsight and water under the bridge because it's done, but what should you do if you're faced with important decisions? Here's a few things to keep in mind while making these decisions.
1~ Be patient with yourself and your situation. I list this first because too many times we get restless and impatient, wanting to do something with your finances that will impact you for years. These include buying or selling a house, car or any other expensive item. Don't ever be in such a hurry that you rush into something you don't fully understand.
2~ Take a step back (and a deep breath). Making any major financial decisions when under stress or strong emotion is never a good thing.
3~ Always live within your means. No exceptions. Period.
4~ Don't buy too much house or car. While houses are assets and generally go up in value, cars are not. They go down in value and if you can't afford the depreciation, don't buy it. Stick with a car that's a few years old and reliable. Buy a house that you can comfortably make the payments, and then some, to pay it off faster.
5~ Avoid debt at all costs. With the exception of a home and possibly some graduate level degrees, DO NOT go into debt. It's not worth it. Debt stifles your ability to build wealth and invest in your future. Cost versus benefit rarely tip the scales in favor of taking out loans of any kind. Most of the time that means sacrificing now for future rewards.
6~ Keep going. When you feel bogged down by where you are at, just remember to keep going! It's not a sprint, it's a marathon and you're not racing against anyone but yourself. As long as you keep putting one foot in front of the other you'll eventually get to where you want to be.
I promise that if you practice these things, not only will you will save yourself much grief, trouble and regret, but you will soar and be able to accomplish your dreams.
Thursday, March 14, 2013
Budgeting: Stay on Target Month After Month
Have you ever had a month or even a series of months where things are just off when it comes to your budget? I know I have. Life happens, things come up that threaten to tip your balancing skills. Maybe you've just lost the patience or the drive to keep going when the light at the end of the tunnel seems so far away. If you're like me you need a tune up once in a while to keep moving forward. So what should you do to stay on top of your game when budgeting becomes mundane?
1~ Breathe. Recognize that life happens, a lot sometimes. Even when you feel like you've been knocked to your knees, it's important to take a deep breath before continuing. No matter what you're going through, it will not last forever. It might not seem like it now, but if you keep pushing you will eventually break through to the other side. Don't let life's detours make you quit. Instead, enjoy the windy path along the way.
2~ Remind yourself of the big picture. Accomplishing your financial goals is a marathon, not a sprint. Big goals, like getting out of debt, saving for a house, kids college, or retirement happens one day, one step at a time. Taking the time to remember where you are headed and why will give you an extra pep in your step.
3~Don't get distracted by your wants. Sure you can throw in wants sometimes to spice things up, but don't make it a habit or you'll lose momentum. This is another reason why it's so important to have a blow category in your budget. It needs to be enough that you can blow off steam, but not so much that it derails your goal efforts.
4~Make it a game. When my husband and I were getting out of debt, we made it a game to see how much extra we could glean to put towards a bill. As a result there were months where we made a double, triple, or even quadruple car payments or student loans. It becomes addictive almost and feels great to see the progress you are making. We are doing the same thing now that we are saving for a down payment for a new home.
5~Put daily reminders around the house, car, work to help you remember. Maybe it's a picture of what you are trying to do. I always encourage my clients to do this because a visual reminder helps a lot when you feel bogged down.
6~ Remember to always budget for those non-monthly expenses. They can quickly become budget busters and also throw you off track. Here's my post about that from last year.
With rare exception, change happens gradually, not overnight. It only happens when the pain of staying the same is greater than the pain of change. If you keep these 6 steps in mind, the mundane will be revitalized again and you will see that change over time.
Wednesday, August 8, 2012
The Difference
I often get asked the question, "How can I help my friend/child/sibling/parent who is struggling with their finances?" The answer to that question often depends on the person or people in question because no matter how badly you want something for someone, you can't do it for them. I know first hand how frustrating this can be. This got me thinking about the people I have coached over the last 2 1/2 years since I became a financial counselor. I've had quite the range in client's ages and circumstances. From the young newlyweds to the retired or nearly retired couple, those with very modest incomes to those with six figure salaries. Some have turned out to be my success stories, while others have struggled to get things together. What really has made the difference? I've come to the conclusion that those who are successful with what I teach have some common characteristics.
1~ Be Teachable: If you want to be successful with what I teach, you have to be open and ready to learn. Not everyone is ready to learn or make the changes necessary.
2~ Realize You Need Help: This is probably one of the hardest steps because it requires you to swallow your pride and be open and honest with not only yourself, but me.
3~ Be United with Your Spouse: If you aren't on the same page or can't get on the same page with your spouse because of trust or communication issues, you will not be successful with your money or your marriage. Fighting about money is a symptom to those deeper issues and must be addressed first.
4~ Be Determined to Follow Through: The mechanics of budgeting isn't difficult, but having the follow through to actually do it is another story. Not giving up even when things start to unravel is what it takes sometimes.
5~ Be Proactive: Ignoring problems will not do. No matter what your circumstances, you have to be in the driver's seat and take control.
So when it comes to trying to help yourself or those you love, keep these qualities in mind. They transcend both age and income and are more important in determining the outcome. These aren't something developed overnight but through patience and diligence even the worst of circumstances can be turned around. When they all come together nothing will stand in the way of achieving success.
1~ Be Teachable: If you want to be successful with what I teach, you have to be open and ready to learn. Not everyone is ready to learn or make the changes necessary.
2~ Realize You Need Help: This is probably one of the hardest steps because it requires you to swallow your pride and be open and honest with not only yourself, but me.
3~ Be United with Your Spouse: If you aren't on the same page or can't get on the same page with your spouse because of trust or communication issues, you will not be successful with your money or your marriage. Fighting about money is a symptom to those deeper issues and must be addressed first.
4~ Be Determined to Follow Through: The mechanics of budgeting isn't difficult, but having the follow through to actually do it is another story. Not giving up even when things start to unravel is what it takes sometimes.
5~ Be Proactive: Ignoring problems will not do. No matter what your circumstances, you have to be in the driver's seat and take control.
So when it comes to trying to help yourself or those you love, keep these qualities in mind. They transcend both age and income and are more important in determining the outcome. These aren't something developed overnight but through patience and diligence even the worst of circumstances can be turned around. When they all come together nothing will stand in the way of achieving success.
Wednesday, January 18, 2012
Confessions of a Financial Coach
The Tortoise and The Hare:
It's not that fun to be and feel like you're the only tortoise in a world of hares. After all Tortoises are kind of ugly. They are big, bulky and all hard and wrinkled. Hares on the other hand, are fun, popular, fast, and sleek. Sexy even, compared to the tortoise. But if you think about it, tortoises are superior in many ways. While they are worn and weathered, they have everything they need to get through the storms of life. They carry their home after all, and they have endurance for the long journey. Hares are fast in bursts, but have ADD when it comes to staying focused on the task at hand. They are also ill prepared for drought and famine.
Sometimes I feel like the slowest tortoise in the world, like I'm never going to reach my financial goals. This isn't helped by feeling like I'm surrounded by hares, jetting past and dancing around me with all their excitement and great new things. Because of this, I do a lot of self-adjustment. I have to sit back and see the path I've traveled. It's been long and rocky. While I'm not to the top yet, I've come a very long way and life is good. If I had to, I would do it ALL again because it's been worth every hard step. While we only have one car for the time being and our house is a little on the small side for our growing family, I can't complain. My husband and I are debt free except for our house AND We have an emergency fund. That's more than about 80-90% of the population have going for them. So yes, I am a tortoise, but I'm proud to be one! Who wants to be a broke, stressed out hare? If you are trying hard to abandon your hare-like ways, keep trying! It's only too late if you stop trying. Just remember, every time I read the story, the tortoise ALWAYS wins.
Friday, August 26, 2011
The Four P's
Perseverance, Patience, Participation, & Perspective- Four words that sum up success in not only your finances, but life. Perseverance, because without it you give up short of the mark when things get hard or aren't working. To me, this is the #1 ingredient for success, because the lack of it shows in your character. It's easy to give up or quit when things get hard. Having perseverance means that you muscle up and shoulder the hard times as well as the good. Having perseverance also takes a lot of another P- patience. You can't have one without the other. Like they say, if you ask for patience, it's tested immediately. So expect it to be hard at first. I chose participation because you have to be in the game to win. It's a choice we make every day. There is no standing still. You are either moving closer to or farther away from your goals. And Perspective, because it's hard to participate, have patience and persevere through the tough times if you don't keep it in mind. Without proper perspective, hope fades and we despair easily. Being successful isn't an accident. It won't just happen. It takes all these qualities working together to get to where we want to be in life.
Friday, October 15, 2010
Perseverance=Success!
If there is one thing that separates the goal-oriented from the wanderers, the strong from the weak, and the successful from the failures; it is PERSEVERANCE through the thick and the thin. This is true if you are trying to become fit physically or financially. While this is such a simple concept, in practice it's very hard. But anything that is hard to do will be worth it in the long run, right?
I want you to take a look at your life. You've got things that are going well and things that aren't. Look at the goals you may have set at the beginning of the year. If you don't have any, think about what you want out of your life and future. What are your financial goals? Do you want to get out of debt? Save for a rainy day or retirement? Have more money to give and help those around you? Whatever your goals, have you accomplished anything towards them or are they sitting untouched on the shelf or in the drawer where you put them? If you aren't moving toward a goal, why is that? Personal finance is exactly that, personal. It's not just about knowing how to do math. By and large it's about the many emotional and behavioral strings attached to those numbers.
Remember, some progress is better than none. It's the slow and steady mentality that you want; crockpot not microwave. As frustrating as it is, there is no shortcut to any place worth going. Maybe it's the optimist in me, but no matter what your circumstances financially or otherwise, a good dose of perseverance will keep you going along the way. Because the sun eventually will come out tomorrow. Please don't be so hard on yourself that you quit altogether. After all, taking two steps forward and one step back will still get you to your dreams.
I want you to take a look at your life. You've got things that are going well and things that aren't. Look at the goals you may have set at the beginning of the year. If you don't have any, think about what you want out of your life and future. What are your financial goals? Do you want to get out of debt? Save for a rainy day or retirement? Have more money to give and help those around you? Whatever your goals, have you accomplished anything towards them or are they sitting untouched on the shelf or in the drawer where you put them? If you aren't moving toward a goal, why is that? Personal finance is exactly that, personal. It's not just about knowing how to do math. By and large it's about the many emotional and behavioral strings attached to those numbers.
Remember, some progress is better than none. It's the slow and steady mentality that you want; crockpot not microwave. As frustrating as it is, there is no shortcut to any place worth going. Maybe it's the optimist in me, but no matter what your circumstances financially or otherwise, a good dose of perseverance will keep you going along the way. Because the sun eventually will come out tomorrow. Please don't be so hard on yourself that you quit altogether. After all, taking two steps forward and one step back will still get you to your dreams.
Friday, July 2, 2010
True Financial Independence
This week as we celebrate the 234th anniversary of our nation's independence, I want you to take stock of your financial independence. I'm not talking about the false sense of independence that debt gives you. I'm talking about true independence or freedom that comes from not being a slave to your creditors. The fact of the matter is that 7 out of 10 households in this country live paycheck to paycheck. This is because we've chosen to have a mortgage that stretches us, a car payment or two, student loans, and to buy things on credit that we can't pay for, all in the name of financial independence. We try to show the world how independent we are by having all these things. When the reality is that we have made ourselves slaves one purchase and/or one loan at a time. As a result, we may also be slaves to a job that we don't really like because we need that paycheck to make our payments.
Today, I want you to think outside the box. If doing those things cause nothing but stress, worry and heartache, how is that freedom? Today, I want you to dream about what it would be like to truly be financially free. What would you be able to do or not have to do? Who would you help? I'm asking you to dream about where you want to be and what you want to be able to do 5 or 10 years from now. Now ask yourself if what you are doing today will lead you to or away from those dreams. Some of you cynics might be thinking, "well, I won't ever get there, so what's the point of trying." That attitude is exactly what is going to stop you from even trying, let alone, actually achieving your dreams. One of my favorite quotes is by Zig Ziglar, it's one of his mantras. "If you aim at nothing, you hit it every time." He also says that, "failure is an event, not a person."
I guess what I'm trying to say is that no matter where you stand financially today, what are you doing to achieve your dreams of tomorrow? Remember true financial independence comes from hard work and patience. Only you can decide if it's worth striving for. Celebrate your Independence Day by choosing to make changes that lead to financial independence!
Today, I want you to think outside the box. If doing those things cause nothing but stress, worry and heartache, how is that freedom? Today, I want you to dream about what it would be like to truly be financially free. What would you be able to do or not have to do? Who would you help? I'm asking you to dream about where you want to be and what you want to be able to do 5 or 10 years from now. Now ask yourself if what you are doing today will lead you to or away from those dreams. Some of you cynics might be thinking, "well, I won't ever get there, so what's the point of trying." That attitude is exactly what is going to stop you from even trying, let alone, actually achieving your dreams. One of my favorite quotes is by Zig Ziglar, it's one of his mantras. "If you aim at nothing, you hit it every time." He also says that, "failure is an event, not a person."
I guess what I'm trying to say is that no matter where you stand financially today, what are you doing to achieve your dreams of tomorrow? Remember true financial independence comes from hard work and patience. Only you can decide if it's worth striving for. Celebrate your Independence Day by choosing to make changes that lead to financial independence!
Friday, April 2, 2010
Money is Active
Anyone who has had money or would like to have money (pretty much everyone) has experienced how money is active. It has a flow that makes it unique. Whether it's observed through varying interest rates, cash flow, or value, money is dynamic. If you try to hold onto it by burying it in the back yard in ten years, it will have lost buying power, and therefore value, due to inflation. Sometimes the harder you hold onto it the faster it seeps through your fingers. (That is the paradox of giving that I'll talk about another time.) The vast majority of time however, money leaves because you're not respecting it. You've gotten lazy and just going with the flow, swept up in the current so to speak.
Are you starting to see that if you can understand this law of money, it might be easier to manage? This is why I think I keep talking about and coming back to the principles of being intentional, organized, focused and above all educated about how to handle money. This concept takes time and patience to understand and develop. It doesn't happen overnight but if you keep going, you will get there. Through this process please remember that money doesn't care what level of education you have. The fact of the matter is if you don't know about money management, then you can't keep beating yourself up. Until now you have probably been doing the best you could with what you knew. Ignorance about money and impatience are a recipe for disaster. Now it's time to change that and do better.
Are you starting to see that if you can understand this law of money, it might be easier to manage? This is why I think I keep talking about and coming back to the principles of being intentional, organized, focused and above all educated about how to handle money. This concept takes time and patience to understand and develop. It doesn't happen overnight but if you keep going, you will get there. Through this process please remember that money doesn't care what level of education you have. The fact of the matter is if you don't know about money management, then you can't keep beating yourself up. Until now you have probably been doing the best you could with what you knew. Ignorance about money and impatience are a recipe for disaster. Now it's time to change that and do better.
Friday, March 26, 2010
Patience Pays
These days a little patience in our society could go a long way in solving many problems we face. Especially when it comes to our money. I mean think about it. We live in a world that has rush rush, buy now pay later, gotta have it NOW type of thinking. So many people are willing to put money into the next 'sure' investment or other get rich quick schemes. What ever happen to good old fashioned patience in getting what we want? Has this all too important virtue really been foolishly thrown by the wayside? It seems like now days adults walk around acting like a kid in a candy store throwing a tantrum. Only instead of a candy store it's the Mall, Electronics R Them or Big Box store inc. We use rationalizations like, "I work hard so I deserve it" or "I need it" because it's safer, a good investment, or "it makes me look sophisticated or smart." Or my personal favorite- "I can pay the monthly payment so I must have the money to buy it." These excuses are nothing but a bunch of garbage that make it all better when the bills come due. While all of this stuff is nice to have, we delude ourselves into thinking that we must have it, no matter what the cost.
I believe the amount of patience one has is in direct proportion to how much wealth one can acquire. You see, your income is your most powerful tool in building wealth. If it all goes out the door in payments to banks and corporations then you can't build wealth effectively. This is true whether you make $50,000 or $500,000 a year. In the average working lifetime you see at least a million dollars pass through your fingers. How much are you going to hold onto? If you lack patience, then you will always be in debt, going from loan to loan all because you want it now. Most poor financial decisions can be traced back to a lack of patience. Ironic when you consider that newlyweds spend the first 7 years of marriage trying to attain what took their parents 30 years to achieve.
I have said before and I'm sure I'll say it again, the key to getting out of debt is to have focused intensity over the long haul. This focus requires diligence and of course patience. I know these concepts might seem a little abstract so let me give you an example of how patience really pays off. The average car payment in this country is around $478 a month. That's a pretty big chunk of change to be forking out every month for something that is going to go down in value every year. Think about this instead. If you saved up and paid cash for say a $2000 car and then continue to save what you would have spent in a car payment. You could easily upgrade with to a better car in a matter of months. Over a lifetime, these car payments can cost you dearly. If you show patience and invest that car payment you could easily have close to a million dollars by the time you retire. Last time I checked, a $2000 car in good condition will still get you work and back just as well as a $20,000 car. It might not be as pretty or smell as nice but for a the time being, it's worth it's weight in gold- literally.
Patience will pay off every time you apply it, whether it's buying a house, car, big screen TV, furniture or anything really. It's one of those behaviors that again separates the rich from the poor. Like diligence and focus, it gives you perspective of what's really important in the long run. This isn't to say that you can't ever go out and buy nice stuff. But it means that you just shouldn't rush out and buy it all right now. Chances are that you'll value the stuff more if you had to sacrifice more to get it.
I believe the amount of patience one has is in direct proportion to how much wealth one can acquire. You see, your income is your most powerful tool in building wealth. If it all goes out the door in payments to banks and corporations then you can't build wealth effectively. This is true whether you make $50,000 or $500,000 a year. In the average working lifetime you see at least a million dollars pass through your fingers. How much are you going to hold onto? If you lack patience, then you will always be in debt, going from loan to loan all because you want it now. Most poor financial decisions can be traced back to a lack of patience. Ironic when you consider that newlyweds spend the first 7 years of marriage trying to attain what took their parents 30 years to achieve.
I have said before and I'm sure I'll say it again, the key to getting out of debt is to have focused intensity over the long haul. This focus requires diligence and of course patience. I know these concepts might seem a little abstract so let me give you an example of how patience really pays off. The average car payment in this country is around $478 a month. That's a pretty big chunk of change to be forking out every month for something that is going to go down in value every year. Think about this instead. If you saved up and paid cash for say a $2000 car and then continue to save what you would have spent in a car payment. You could easily upgrade with to a better car in a matter of months. Over a lifetime, these car payments can cost you dearly. If you show patience and invest that car payment you could easily have close to a million dollars by the time you retire. Last time I checked, a $2000 car in good condition will still get you work and back just as well as a $20,000 car. It might not be as pretty or smell as nice but for a the time being, it's worth it's weight in gold- literally.
Patience will pay off every time you apply it, whether it's buying a house, car, big screen TV, furniture or anything really. It's one of those behaviors that again separates the rich from the poor. Like diligence and focus, it gives you perspective of what's really important in the long run. This isn't to say that you can't ever go out and buy nice stuff. But it means that you just shouldn't rush out and buy it all right now. Chances are that you'll value the stuff more if you had to sacrifice more to get it.
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