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How To Live Like a King on a Peasant’s Income

How To Live Like a King on a Peasant’s Income

Wouldn’t it be nice to live like a king, rule the land, and have people bow at your feet? It sure sounds like a nice fantasy that most of us think we can’t attain… but the truth is, you can.

Well, we might not get other people to bow to us, but we can certainly find a way to dress like a king, eat like one, and travel like one. Most kings have gorgeous clothes and a nice car; they eat at fancy restaurants; they travel in first class; and they always have crowns. Who’s to say we can’t experience a little of that?

Now, I know what you’re thinking: all of that might seem out of reach on a small income like yours, but I’m here to tell you it’s possible.

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There are ways to live like a king (or at least close to it) on a very modest salary—the key is to understand how to get great deals without putting yourself into debt. If you do your research, exercise patience, and keep your spending in check, you’ll be feeling like royalty in no time. Here’s how to go about it:

How To Wear King’s Clothes:

If you were a real king, you’d wear extremely nice clothes from the top name brands. Designers would beg you to wear their creations, and you’d have someone to do all your shopping and clothes coordinating for you.

All that sounds a bit luxurious, but there’s no reason why you can’t experience a little bit of that royal treatment. While you might not be able to match the exact brands favored by royalty, you can certainly buy clothes of very nice quality at a lower cost.

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One way to do this is to join membership shopping sites: membership websites like RueLaLa routinely have luxury brands anywhere from 20%-90% off of retail prices. Most of them also sell home goods, so you can make sure you’re living in the lap of luxury at home too. Also, don’t discount thrift stores, where you can scour thrift stores for both vintage and name-brand items that are worth a lot more than the small price tags seen at Goodwill—all it takes is a little bit of know-how and a willingness to look to find the best deals.

Also, don’t forget about websites like Overstock that carry nice items for less and eBay, where you can bid on brand new or gently used clothing items. Just remember to set a budget to stick to it. Living like a king is great, but only if you don’t go into debt to do it. Bidding online can get to be a bit addicting. It always helps to remember that unless it’s an extremely rare item, someone will sell something similar to it in no time.

Fancy Restaurants:

A few years ago, some five star restaurants would simply be out of a “peasant’s” price range, but with the birth of coupons and secret shopper programs, you can easily try out some of the best restaurants in the world for far less than you could have ever imagined.

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As a secret shopper, you can try out restaurants and eat for free as long as you rate their service and their meals. With companies like Groupon you can buy coupons to dozens of restaurants and get your meals approximately 50% off.

Drive A Fancy Car:

I can’t promise that you can afford a fancy car, but that doesn’t mean you can’t drive one. Have a fun day out with your friends. If you’re a guy, dress up in a suit with your nicest tie or bow tie. Be sure to have your shirt and pants pressed. (Wrinkly clothes don’t give off the best impression.) Ladies, definitely go for your nicest heels and a pretty dress. If it’s cold were you live, make sure to wear a nice peacoat or leather jacket, as opposed to a sweatshirt with your favorite team on it. I usually shop around at places like Marshalls or Ebay to get the best deals on clothing. The brands are not as important as how well they fit you and look on your shape. Once you’ve picked your you outfit and are dressed to impress, go out and test-drive some beauties.

Travel First Class:

There’s a whole movement of people called “churners” who use credit card points to fly free around the world. They also get free nights at some of the world’s best hotels and upgrades wherever they go. The best part is that most of these churners are normal people who just learned how be really smart about their credit cards.

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In order to master this, you have to have good self-control and great credit. Then, you have to be able to do the research required to understand the risks of being a churner, which could involve negative hits to your credit due to the amount of credit cards they apply for. Many churners apply for several credit cards all in the same day to avoid too many inquires on their credit. They also plan it out, so that they can reapply for other cards every 3 months. In order to receive these points you will have to spend anywhere from $1,000-$10,000 in a specified amount of time, so you’ll need to do your research and find out if your expenses actually merit getting a specific card. Spending needlessly just to get points defeats the purpose of getting free flights, so always stay within your means.

There are many resources online where you can go to find out how to travel in style. Join a forum online or read blogs written by churners to get insider tips on how the experts do it best. Some of our favorites are Milepoint.com and FlyerTalk.com.

Having A Crown:

Well, this last one might not be as easy as the previous items for us to attain. However, if you are smart with your money, utilize sales, shop around, clip coupons, and scour thrift stores, you can definitely save up for a crown in no time.

Featured photo credit:  Blissful couple toast the beginning of their holiday via Shutterstock

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Catherine Alford

Catherine is the go to personal finance expert for educated, aspirational moms who want to recapture their life passions.

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Last Updated on September 2, 2020

How to Set Financial Goals and Actually Meet Them

How to Set Financial Goals and Actually Meet Them

Personal finances can push anyone to the point of extreme anxiety and worry. Easier said than done, planning finances is not an egg meant for everyone’s basket. That’s why most of us are often living pay check to pay check. But did anyone tell you that it is actually not a tough task to meet your financial goals?

In this article, we will explore ways to set financial goals and actually meet them with ease.

4 Steps to Setting Financial Goals

Though setting financial goals might seem to be a daunting task, if one has the will and clarity of thought, it is rather easy. Try using these steps to get you started.

1. Be Clear About the Objectives

Any goal without a clear objective is nothing more than a pipe dream, and this couldn’t be more true for financial matters.

It is often said that savings is nothing but deferred consumption. Therefore, if you are saving today, then you should be crystal clear about what it’s for. It could be anything, including your child’s education, retirement, marriage, that dream vacation, fancy car, etc.

Once the objective is clear, put a monetary value to that objective and the time frame. The important point at this step of goal setting is to list all the objectives that you foresee in the future and put a value to each.

2. Keep Goals Realistic

It’s good to be an optimistic person but being a Pollyanna is not desirable. Similarly, while it might be a good thing to keep your financial goals a bit aggressive, going beyond what you can realistically achieve will definitely hurt your chances of making meaningful progress.

It’s important that you keep your goals realistic, as it will help you stay the course and keep you motivated throughout the journey.

3. Account for Inflation

Ronald Reagan once said: “Inflation is as violent as a mugger, as frightening as an armed robber and as deadly as a hitman.” This quote sums up what inflation could do your financial goals.

Therefore, account for inflation[1] whenever you are putting a monetary value to a financial objective that is far into the future.

For example, if one of your financial goal is your son’s college education, which is 15 years from now, then inflation would increase the monetary burden by more than 50% if inflation is a mere 3%. Always account for this to avoid falling short of your goals.

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4. Short Term Vs Long Term

Just like every calorie is not the same, the approach to achieving every financial goal will not be the same. It’s important to bifurcate goals into short-term and long-term.

As a rule of thumb, any financial goal that is due in next 3 years should be termed as a short-term goal. Any longer duration goals are to be classified as long-term goals. This bifurcation of goals into short-term vs long-term will help in choosing the right investment instrument to achieve them.

By now, you should be ready with your list of financial goals. Now, it’s time to go all out and achieve them.

How to Achieve Your Financial Goals

Whenever we talk about chasing any financial goal, it is usually a two-step process:

  • Ensuring healthy savings
  • Making smart investments

You will need to save enough and invest those savings wisely so that they grow over a period of time to help you achieve goals.

Ensuring Healthy Savings

Self-realization is the best form of realization, and unless you decide what your current financial position is, you aren’t heading anywhere.

This is the focal point from where you start your journey of achieving financial goals.

1. Track Expenses

The first and the foremost thing to be done is to track your spending. Use any of the expense tracking mobile apps to record your expenses. Once you start doing it diligently, you will be surprised by how small expenses add up to a sizable amount.

Also categorize those expenses into different buckets so that you know which bucket is eating most of your pay check. This record keeping will pave the way for cutting down on un-wanted expenses and pumping up your savings rate.

If you’re not sure where to start when tracking expenses, this article may be able to help.

2. Pay Yourself First

Generally, savings come after all the expenses have been taken care of. This is a classic mistake when setting financial goals. We pay ourselves last!

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Ideally, this should be planned upside down. We should be paying ourselves first and then to the world, i.e. we should be taking out the planned saving amount first and manage all the expenses from the rest.

The best way to actually implement this is to put the savings on automatic mode, i.e. money flowing automatically into different financial instruments (mutual funds, retirement accounts, etc) every month.

Taking the automatic route will help release some control and compel us to manage what’s left, increasing the savings rate.

3. Make a Plan and Vow to Stick With It

Learning to create a budget is the best way to get around the uncertainty that financial plans always pose. Decide in advance how spending has to be organized

Nowadays, several money management apps can help you do this automatically.

At first, you may not be able to stick to your plans completely, but don’t let that become a reason why you stop budgeting entirely.

Make use of technology solutions you like. Explore options and alternatives that let you make use of the available wallet options, and choose the one that suits you the most. In time, you will get accustomed to making use of these solutions.

You will find that they make it simpler for you to follow your plan, which would have been difficult otherwise.

4. Make Savings a Habit and Not a Goal

In the book Nudge, authors Richard Thaler and Cass Sunstein advocate that, in order to achieve any goal, it should be broken down into habits since habits are more intuitive for people to adapt to.

Make savings a habit rather than a goal. While it might seem to be counterintuitive to many, there are some deft ways of doing it. For example:

  • Always eat out (if at all) during weekdays rather than weekends. Weekends are more expensive.
  • If you are a travel buff, try to travel during off-season. You’ll spend significantly less.
  • If you go shopping, always look out for coupons and see where can you get the best deal.

The key point is to imbibe the action that results in savings rather than on the savings itself, which is the outcome. Focusing on the outcome will bring out the feeling of sacrifice, which will be harder to sustain over a period of time.

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5. Talk About It

Sticking to the saving schedule (to achieve financial goals) is not an easy journey. There will be many distractions from those who are not aligned with your mission.

Therefore, in order to stay the course, surround yourself with people who are also on the same bandwagon. Daily discussions with them will keep you motivated to move forward.

6. Maintain a Journal

For some people, writing helps a great deal in making sure that they achieve what they plan.

If you are one of them, maintain a proper journal, where you write down your goals and also jot down the extent to which you managed to meet them. This will help you in reviewing how far you have come and which goals you have met.

When you have a written commitment on paper, you are going to feel more energized to follow the plan and stick to it. Moreover, it is going to be a lot easier for you to track your progress.

Making Smart Investments

Savings by themselves don’t take anyone too far. However, savings, when invested wisely, can do wonders.

1. Consult a Financial Advisor

Investment doesn’t come naturally to most of us, so it’s wise to consult a financial advisor.

Talk to him/her about your financial goals and savings, and then seek advice for the best investment instruments to achieve your goals.

2. Choose Your Investment Instrument Wisely

Though your financial advisor will suggest the best investment instruments, it doesn’t hurt to know a bit about the common ones, like a savings account, Roth IRA, and others.

Just like “no one is born a criminal,” no investment instrument is bad or good. It is the application of that instrument that makes all the difference[2].

As a general rule, for all your short-term financial goals, choose an investment instrument that has debt nature, for example fixed deposits, debt mutual funds, etc. The reason for going for debt instruments is that chances of capital loss is less compared to equity instruments.

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3. Compounding Is the Eighth Wonder

Einstein once remarked about compounding:

“Compound interest is the eighth wonder of the world. He who understands it, earns it… He who doesn’t… Pays it.”

Use compound interest when setting financial goals

    Make friends with this wonder kid. The sooner you become friends with it, the quicker you will reach closer to your financial goals.

    Start saving early so that time is on your side to help you bear the fruits of compounding.

    4. Measure, Measure, Measure

    All of us do good when it comes to earning more per month but fail miserably when it comes to measuring the investments and taking stock of how our investments are doing.

    If we don’t measure progress at the right times, we are shooting in the dark. We won’t know if our saving rate is appropriate or not, whether the financial advisor is doing a decent job, or whether we are moving closer to our target.

    Measure everything. If you can’t measure it all yourself, ask your financial advisor to do it for you. But do it!

    The Bottom Line

    Managing your extra money to achieve your short and long-term financial goals

    and live a debt-free life is doable for anyone who is willing to put in the time and effort. Use the tips above to get you started on your path to setting financial goals.

    More Tips on Financial Goals

    Featured photo credit: Micheile Henderson via unsplash.com

    Reference

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