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The Only Route to Financial Freedom – Entrepreneurial Mind

The Only Route to Financial Freedom – Entrepreneurial Mind

We are all familiar with the old adage,  “The rich get richer while the poor get poorer,” but why is this so? Let’s actually take a moment and try to break it down.  Is there something the rich have, inherently know or do that the poor and the stagnating mediocrity dwellers don’t? I believe there is, and here’s why.

The Education System

We have all grown up being taught that higher education is the most stable, feasible and surest way to success. While the people who follow the rules go on to realize higher academic achievements, the majority of them never spend time outside of school learning about the rules of money. Unfortunately, our educational system was designed to produce hard-working perpetual employees rather than self-sufficient millionaires.

 “ The purpose of foundation (the general education board) was to use the power of money, not to raise the level of education in America, as was widely believed at the time, but to influence the direction of that education…The object was to use the classroom to teach attitudes that encourage people to be passive and submissive to their rules.

The goal was-and is- to create citizens who were educated enough for productive work under supervision but not enough to question authority or seek to rise above their class. True education was to be restricted to the sons and daughters of the elite. For the rest, it would be better to produce skills workers with no particular aspiration other than to enjoy life.”

-G.Edward Griffin in The Creature from Jekyll Island, on Rockerfeller’s General Education Board, found in 1903.

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If you have or plan on choosing a professional career you might live to be comfortable. But without the applied knowledge of business and investments, you will find it extremely difficult to live the life you had once dreamed of as a kid.

Debt            

What’s your initial reaction when you hear the word debt? Nine out of 10 people would probably experience a less than positive one.

Most people take out loans or use their credit cards to pay for things they cannot afford. Most of those things become liabilities. Meaning they suck the money out of your pockets to a place where it will never be seen again.

For you to fully understand debt and how to deal with it, you must open your mind to its uses and possibilities. If you didn’t already know, there is actually debt that is considered good.

Good debt can make you more money than you have.

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Let’s say you take out a loan and invest it into a rental property. This would be considered good debt because it’s actually putting money back into your pocket. On the contrary taking out a loan to buy that Mercedes C Class you can by no means afford while living in your mom’s basement, would be considered bad debt.

Utilizing and understanding the concept of good debt will actually increase your financial stability not diminish it.

Save Your Money

Most common mantra #2: Go to school get a high-paying job and save your money. Yea,yea,yea we’ve heard it all before.

If we Gen Y’ers are actually planning on building our own wealth, working our asses off just to stack it up in the bank will not cut it.  Just like with good debt, knowing how to spend your money is just as important as making and saving it. Educate your self on investment options that interest you and spend that money. Work for your money and then make it work for you. Otherwise you’ll be stuck on the perpetual hamster wheel with the rest of them. 

Get a Job at a Big Corporation and Work Your Way up the Organizational Ladder

We all go through that pressing brain-crushing moment when we realize that we need to make a serious decision about the direction we want to go in life. You’re sick of your parents “helping you out” and you feel an overwhelming need to break through into your own independence. But now what? When your age has caught up to society’s standards of where you’re supposed to be in life I’ve seen people take one of these few directions:

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A) Blind themselves with their social life (friends, girlfriends, boyfriends, I like to party all the time etc.)

B) Settle into a job doing something they love (or sadly not even that,) which doesn’t provide any real growth or opportunity but is stable enough to make them feel comfortable.

C) Get a job at a big corporation and spend the majority of their years putting their blood, sweat, and tears into working their way up the corporate ladder.

D) Or you can go against the grain of it all and become an entrepreneur by starting at the bottom with the goal to make it to the top on his or her own terms.

As for options A and B, I don’t think people who pursue them are too concerned with the prospect of becoming wealthy. Option C is where life gets tough. These people want success and they’re willing to work for it. The problem is after all the time spent killing themselves in school in hopes of landing a job at a top corporation; these people spend the best years of their lives working over 60 hours a week for that pot of gold at the end of the rainbow.

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The worst part is that these people spend their lives making someone else’s business prosper, and do not work to help themselves. They are constantly depending on getting raises, bonuses and promotions, and put all of their energy into their next paycheck.

For all of the D’s out there, you realize the importance of owning the ladder instead of climbing someone else’s. You would rather put your blood and sweat into your own business to create real wealth and financial freedom for yourself.

You Need Money to Make Money

If you didn’t have the pleasure of being born into a rich family, or have access to daddy’s Rolodex it probably seemed at one point or another that making millions on your own was a long way away. I remember growing up and wishing my parents were rich, wishing I had more connections and that someone would be able to pass me over something instead of starting at square one. But if you look closely you’ll realize that because information and resources are easy access, riches can be and are made through innovation and knowledge more so than through having money alone.

Live Below Your Means

It’s all about your mind set. If you’re focusing on staying below your established means how can you ever grow and surpass your current financial standing?

It is said that the person who lives below their means suffers from a lack of imagination. I say, if you can’t afford it innovate ways to make it possible!

Original Source – Elite Daily

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Brian Lee

Chief of Product Management at Lifehack

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Published on September 17, 2018

How Being Smart With Your Money Leads to Financial Success

How Being Smart With Your Money Leads to Financial Success

Achieving financial success is not something that just happens. Maybe if you win the lottery or something, but for the average person like you or me, it comes from a series of small steps you take over a long period of time.

With each step, you form a new smart money habit. And with each smart money habit, you build towards financial independence.

So what sort of habits can you form to get on that path? Let’s take a look at smart money habits you can start today to get you closer to a financially independent future.

1. Avoid being “penny wise but pound foolish”

It’s tempting to try saving a couple cents here and there when buying small items. However, that’s not where the real money is saved. You’re putting in extra effort for something that doesn’t move the needle.

You get the most bang when you’re able to cut down on your bigger bills. For example, finding a lower interest rate for your mortgage could save you $50+ per month. And cutting your transportation bill by purchasing a cheaper car or taking public transportation can provide large gains as well.

So, look at your recurring expenses such as housing, transportation, and insurance, and see where there’s wiggle room. It’s a much better use of your time than trying to pinch pennies here and there on smaller purchases.

2. When you want something big, wait

Impulsivity can get you in trouble in most aspects of life. Finances are no different.

It’s human nature to see something and want it right then and there. It starts as a kid in the checkout line at the grocery store, and it continues on through adulthood.

We get an idea in our head of something we want, and it’s hard not to go out and get it right then.

A good example is wanting a new car. Perhaps you’ve had your car for several years. It’s crossed the 100k mile mark. Maybe maintenance is due, and you’re annoyed that you need to replace the timing belt or purchase new tires.

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So, you get the itch.

You start digging around online, and you realize you could trade in your current car for something newer and more exciting… all for a few hundred bucks a month. Then you get obsessed.

Here’s where you have to take a step back.

Your newfound obsession is clouding your judgement. Rather than giving into the impulse, wait it out.

Set a timeframe for yourself. Maybe you come back to the decision three months down the road. See if the obsession lasts.

It might, but often, a funny thing happens. Often, you forget about it. And often, you find that the new car wasn’t a need at all.

The impulse faded. And you just saved yourself a ton of money.

3. Live smaller than you can afford

You finally get that big raise. And you want to celebrate – and why not?

You’ve been looking forward to this forever. And after all, it was all due to your hard work.

That’s fine, splurge a little. However, make it a one-time deal and be done.

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Don’t get caught in the trap that just because you’re now making more money, you should spend more.

Too often, people get more money and feel like they that gives them the means to buy a bigger house, a bigger car… you know the drill. Resist.

The fact is that living smaller than what you can afford is one of the fastest ways to build savings.

But if you constantly upgrade as you begin to make more, then you’ll never get ahead. You’ll just build up more debt along the way and have just as little wiggle room as before.

4. Practice smart grocery shopping

Food… it’s one of the biggest portions of any budget. And if you’re not careful, it can be one of the biggest drains on your wallet.

But luckily, there are a few things you can do to ensure that you stay smart with your money when buying groceries.

Create a grocery budget

Set a strict weekly grocery budget. When you know how much you can spend on groceries, you can then plan your weekly menu around it.

Once you know what all you need, you can go shopping and keep a running tally as you shop to ensure you’re on track.

I tend to do this in my head, rounding for each item. However, writing it down as you go would probably work best for most people.

Make a list… and never deviate

Never go to the grocery store without a list. If you go to the store with a ballpark idea in mind, you don’t have a true ide of what you need.

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You’re not well-researched. You don’t know what the sales are. As a result, you’re going to make decisions on the fly.

These impulse decisions will lead to overspending, which will derail your grocery budget.

Eat before going grocery shopping

It’s also important to eat prior to going to the grocery store. Hunger is a powerful force.

If you’re shopping on an empty stomach, everything is going to look good. In particular, you may find a lot of ready-made, processed snacks will look enticing.

After all, you’re hungry now and that food is easily available. So subconsciously, you may lean towards those items.

Unfortunately, not only are those items typically less healthy, but they’re likely more expensive. You pay for convenience.

However, when you eat prior to shopping, then you’ll shop with a clear mind. Your hunger won’t cloud your judgement, influencing you to make poor decisions like a cartoon devil resting on your shoulder whispering in your ear.

This makes it much easier to stick to your grocery plan.

5. Cancel your gym membership

Now that you’re all set on your food, it’s time to get smart about managing your budget in terms of physical fitness. And let’s begin by avoiding the gym. The gym bill, that is.

The average gym membership costs around $60 per month. That’s $720 a year.

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Yet, two out of three gym memberships go unused. That means two-thirds of people who have a gym membership are literally giving away almost a thousand bucks a year. It’s crazy!

I recommend seeking an alternative. One good alternative is to look into fitness streaming services.

Streaming services allow you to stream hundreds of workouts like Insanity and p90x, right in your own home for around $10-20 a month. That’s $40-50 less a month than the average gym membership.

Of course, then there’s the free option. The internet is full of free workouts that you can do on your own with minimal or no equipment.

For example, there’s the Couch to 5K program, that I personally used a decade ago to ease myself from couch potato to running my first 5K race. If I could do it, anyone could.

Then there are free resources like reddit that have limitless information on workouts. The Fitness subreddit has done all the research for you, populating workout tips and detailed workout routines for anyone to use in their wiki.

There are several routines that require no equipment. And you can join in on the subreddit to become part of the community, making it easier for those seeking comraderie and encouragement in their fitness goals. All for free.

It’s baby steps… And baby steps can start now!

I’ve never met anyone that can’t stand to be a bit smarter with their money. And on the flip side, anyone can get smarter with their money. But remember, it doesn’t happen all at once.

Begin by fighting your impulses. Prepare for the week and be smart at the store. And cut monthly expenses like gym memberships that are overpriced and you probably aren’t getting your money’s worth out of anyway.

The devil is in the details. And the details can change your lifestyle and prep you for a financially independent future.

Featured photo credit: Unsplash via unsplash.com

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