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3 Things Music Can Teach You About Money

3 Things Music Can Teach You About Money

While you may not think of turning to a musician for financial advice, music can teach us some interesting lessons about managing our finances.

As a life-long guitar player, I also play the financial calculator as a financial advisor/planner.  Though anyone would agree that being a musician and being a financial adviser are completely different career paths, I have come to the realization that the two are not that different after all.

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In fact, the habits that I have developed over the years as a guitarist have helped me enormously as a financial adviser, especially when interacting with my clients. There are three parallels I have found between learning to play an instrument and learning to successfully manage your finances:

Organization is a key factor in music and money

Think about a child banging on some kitchen pots or a jackhammer in the street. The erratic sounds can hardly be classified as music, because what distinguishes music from any other sound is organization. When someone decides to learn an instrument, they start by learning different scales, arpeggios, and chords. This system of organization enables them to transform haphazard noise into a unique and coherent piece of rhythm and melody.

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In the same way, successfully managing our finances must start with organization. Otherwise, without a good system in place, our financial life may look like haphazard decisions made based on fickle emotions rather than thoughtful planning. There are many various choices to be made when organizing your financial life, just as a musician has literally billions of patterns and combinations he could use to organize sound into music.

Tip to start organizing your finances: A simple way to start is to group your finances into smaller and more manageable units in the same way music is organized into scales, chords and arpeggios. For example, a group called Cash may consist of your cash flow, designed to track monthly cash surplus or cash deficit numbers. Giving could include your monthly charitable gifts. Time may include time based goals which may need funding such as a child going to college, or replacing your kitchen.

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Your music taste will dictate how you play, just as your personal values will dictate how you use your money

The musical preference of the musician will dictate the decisions that she makes while playing. For example, a flamenco guitarist and a rock guitarist use the same instrument to play, but their different musical tastes will determine which notes they use and which notes they leave out, their strumming technique, and the movement of their fingers along the fingerboard.

Similarly, a person’s financial decisions should reflect their personal values. A healthy financial life emerges when all of our financial decisions are in harmony with our personal values. For example, if you prioritize giving, you will be certain that your resources are set up in a way to share your wealth with family and perhaps get involved in philanthropic projects. While someone who prioritizes Risk above all may wish to maximize insurance coverage.

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Tip to start aligning your money with your values: Start by making a list of the things that you value most. Kind of like a “gratitude” list. Now take a good look at your financial life. Are your spending, saving, investing and making choices based on what matters most to you? Are there past decisions that you regret? Are there decisions that you keep putting off? What are the consequences if you take no action?

You can’t eliminate the financial aspect of risk, but it can be transferred to ease the blow

The best part of learning to play an instrument is getting to share the music with others. Yet there are inherent risks that come with playing for an audience. For example, during a guitar performance a string might pop, the guitar may go out of tune, or in a moment of panic the musician may forget the right chord to play. All these things are unplanned situations that will negatively impact the performance, but they shouldn’t make the musician fearful of playing. The musician cannot eliminate the risks, but they can mitigate them by placing an extra guitar on the stage, getting a digital tuner, or making sure they have a copy of the music handy.

Featured photo credit: Strum/Lucas Boesche via unsplash.com

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3 Things Music Can Teach You About Money

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Last Updated on January 21, 2020

How to Develop a Millionaire Mindset in 6 Simple Steps

How to Develop a Millionaire Mindset in 6 Simple Steps

We all like to dream about being financially wealthy. For most people though, it remains a dream and nothing more. Why is that?

It’s because most people don’t set their mind to achieving that goal. They might not be happy in their current situation but they’re comfortable – and comfort is one of the biggest enemies of growth.

How do you go about developing that millionaire mindset? By following these simple steps:

1. Focus On What You Want – And Take It!

So many people are too timid to admit they want something and go for it. When there is something that you want to accomplish don’t think “I could never actually do that”, think “I could do that and I WILL do that”.

Millionaires play to win, not to avoid defeat.

This doesn’t mean to have to become a selfish jerk. What it means is becoming more assertive and honest with yourself. You don’t have to grab off other people. There is a big pot of unclaimed gold in the middle of the table — why shouldn’t you be the one to claim it? You deserve it!

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2. Become Goal-Orientated

It’s almost impossible to achieve anything if you don’t set firm goals. Only lottery winners become millionaires overnight. By setting yourself attainable goals, you will get there eventually. Don’t try to get rich quickly — get rich slowly.

Let’s take the idea of making your first million dollars and expand on what kind of goals you might set to get there. Let’s also say you’re starting at a break-even position – you’re making enough to get by with a few luxuries, but nothing more.

Your goal for the first year can be having $10,000 in the bank within a year. It won’t be easy but it is doable. Next, you need to figure out the steps you need to take to achieve that goal.

Always look at ways to make growth before cutbacks. With that in mind, you might want to see if you can negotiate a pay rise with your boss, or if there’s another job out there that will pay better. You might be comfortable in your old job but remember, comfort stunts growth.

You may also have other skills outside of your workplace that you can monetize to boost your bank balance. Maybe you can design websites for people, at a fee of course, or make alterations to clothes.

If this is still not enough to make the money you need to save $10,000 in a year, then it’s time to look at cutbacks. Do you have a bunch of old junk that someone else might love? Sell it! Do you really need to spend $10 on your lunch everyday when you could make your own for a fraction of the cost?

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If you are to become a millionaire, you need to start accumulating money.

Here’re some tips to help you: How to Become Goal Oriented and Achieve More in Life

3. Don’t Spend Your Money – Invest It

The reason you need to accumulate money is for step three. Millionaires tend to be frugal people, and that’s because they know the true value of money is in investing. Being your own boss goes hand-in-hand with becoming a millionaire. You’ll want to quit your regular job at some point.

Stop working for your money and make your money work for you.

Rather than buying yourself a new iPad, that $500 could be used to invest in the stock market. Find the right shares (more on that later), and that money could easily double within a year.

There’s not just the stock market — there’s also property, and your own education.

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4. Never Stop Learning

The best thing you can invest in is yourself.

Once most people leave the education system, they think their learning days are over. Well theirs might be, but yours shouldn’t be. Successful people continually learn and adapt.

Billionaire Warren Buffet estimates that he read at least 100 books on investing before he turned twenty. Most people never read another book after they’ve left school. Who would you rather be?

Learn everything you can about how economics works, how the stocks markets work, how they trend.

Learn new skills. If you have an interest in it, learn everything you can about it. You’d be surprised at how often, seemingly useless skills, can become extremely useful in the right situation.

Start developing the habit of learning continuously: How to Create a Habit of Continuous Learning for a Better You

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5. Think Big

While I advise to start off with small goals, you absolutely should have a big goal in mind. If you have a business idea, then that is your ultimate goal – to start that business and make a success of it. If you want to invest your way to millions of dollars and do little work other than research, then that is your big goal.

There is no shame in not achieving a big goal. If you run a business and aim to make $1 million profit in a year and “only” make $200,000, then you’re still significantly ahead of most people.

Aim for the stars, if you fail you’ll still be over the moon.

6. Enjoy the Attention

To be successful, you have to be willing to promote yourself and enjoy the attention to a certain extent. Now the attention doesn’t need to be on yourself, it could be on your brand, but attention definitely attracts money.

Never be embarrassed to get your name out there. That means finding a spotlight and being brave enough to step right up underneath it.

If you run a business, try contacting the local papers. You’d be surprised at how amenable they often are to running a story about you and your business, and it’s all free publicity.

Above all, remember: You control your own destiny. Push hard enough for anything and you’ll get it.

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Featured photo credit: Austin Distel via unsplash.com

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