Tag Archives: saving

How My Money Perspective Has Changed From My 20s to My 30s – What Would I Do Differently? (If Anything)

Leave a reply

As I reflect about my life and my relationship with money, I would definitely say that my approach to spending, saving, and investing has radically changed over the years. Am I just becoming older and wiser or does the current state of the economy have any impact on my views on money? It can be a combination of things but I do believe that with life experience comes more knowledge. I have always had a passion for building wealth and that is something that has not changed since my 20s but my perspective is definitely different now and there are many ways in which I view money differently than I did a decade ago.

Having Money In My Bank Account Means More Than Spending It – I have always been a rather good money saver but over the years, I have become an even more aggressive saver. Why? As I have aged, it is just more satisfying to have a bigger bank account than to spend money on material goods or going out. I am much more willing to sacrifice my desires and wants now than I was able to in my youth. It comes more natural for me to say no to unnecessary purchases and to just save my money instead. For me personally, it just feels good to have a lot of money stored away in a bank account than to spend it.

Spending Money on Clothes Doesn’t Excite Me Anymore – I have always had a love for fashion and wearing stylish and flattering clothing. That would also mean having the nicest shoes and handbags to go with my outfits. Fast forward to the present moment and I now do not care about clothing like I used to. Over the years, I have accumulated a wonderful wardrobe of classics and staple pieces that still fit and look great year after year. This is why there really is no need to go out and constantly buy new clothes unless it is an item that is worn out and in need of a replacement. I also want to point out a valuable life lesson: No one really cares what you wear more than yourself. So there really is no need to overspend on clothing or feel the need to impress anyone because no one really cares about the clothing you wear. That is not to say that you should totally neglect your self image but to consciously make an effort to be less vain because at the end of the day–no one cares what you wear!

I am Obsessed With My Retirement Savings – When you are in your 20s, you do not really think about retirement enough unless you are taught the importance of compound interest and investing as early as you can. Fortunately, my mother had me open an IRA account at the age of 18 years old. While I was making contributions to my IRA as much as I could at the time (which wasn’t too much), my biggest regret is not making a conscious effort to max out my IRA contribution every single year. When I turned 30 years old, I made the conscious effort to start doing that and have really seen the increase over the years which is very encouraging. This motivates me to keep investing into my retirement and watching it grow over time.

My Time Is More Valuable Than Money – Despite how much I prioritize working and making money, as I have gotten older–I have tried to have more of a balance between my work life and personal life. In other words, I cherish and value having quality time as opposed to working nonstop. Sometimes you have to take the time to say no to work and actually enjoy living your life. I would rather just work less and make more as opposed to feeling like I need to work constantly. In the past, I would push myself to work as much as I can, even if that meant less free time to do the things that I loved. Although I still would consider myself a hard worker, I have toned down the intensity and have made having free time more of a priority over work.

Booking a Vacation Is Worth Every Penny – I have been an avid traveler since my mid to late 20s when I started to make a high enough income to allocate money towards one of my biggest passions in life–international travel. To this day, I still believe that travel is money well spent and something that I would never regret spending because the memories that are created are so worth it. While not everyone might have a love for travel, it is important to find something that you love and allow yourself to spend the money on your desired category of choice with zero regrets. I spent the money on travel then and will continue to spend my hard earned money on travel throughout the course of my lifetime. It can be an expensive hobby but it is one that I will always justify as an essential expense.

Lifestyle Inflation – What It Is and Can It Be Avoided?

Leave a reply

It is hard to understand how someone with a high income could be living paycheck to paycheck but it is more common in today’s society than ever before. While there is no denying that high levels of inflation can be a culprit, there is also a phenomenon known as lifestyle inflation which is making it even harder for people to save money. An example of lifestyle inflation could be when a person gets a work bonus or a new job with an increased salary, then this person feels more justified to buy luxury goods or spend more money than ever before. While it is good to treat yourself and spend your hard earned money, it is still really important to prioritize investing and saving as much money as you can because you not only need it for your future but you also might need it for an unexpected emergency.

In your youth, it is very easy to fall into this lifestyle inflation trap because maybe you want to own a fancy car or dress in designer clothing. If you can afford it right now, you might be thinking: Why not? Again, there is nothing wrong with treating yourself but this cannot be an ongoing habit or this is going to lead to a lack of savings and potential debt. The right mindset to have is asking yourself, how do I build my net worth? If you place your focus on building wealth over time, then it will become easier for you to resist overspending on things that you truly do not need. As you get older, it will probably become a more conscious decision to save for retirement or to find investment opportunities rather than overspending. 

The best way to avoid lifestyle inflation is to first shift your mindset as I mentioned previously. For me personally, my mind is more focused on seeing more money in my savings and investment accounts than in my closet because I am a practical person with an understanding that excessive material goods really is not a necessity nor is it really making my life that much better in the long run. Whereas in my youth, I cared very much about having new and stylish clothing including designer labels. Once you have made a mindset change, then the next step is to develop the right habits to support your beliefs. In this case, that would mean to allocate your money towards necessities only and to commit to your financial goals. It can take time to develop the right habits but as long as you start implementing them, then your habits eventually become much more automatic. 

How to Teach Your Children to Become Financially Independent

2 Replies

One of the greatest spiritual gifts that you can give to your children is teaching them how to be financially independent. Many parents seem to believe that they are doing their children a favor by giving them everything that they can provide them and by paying for all their expenses. Even if parents have an abundance of wealth, it is still wiser to teach their children how to earn their own money and not to consistently receive financial handouts. In the long run, when children are given free stuff all the time without having to work for it, this creates entitled, spoiled, helpless, and lazy adult children. In order to break this cycle and to prevent this from happening, as a parent, it is important to teach financial independence from the start. This might require some tough love on your part but it will ultimately ensure that you raise children who become self sufficient and financially secure adults who are not dependent on mommy and daddy’s bank account. This is a positive thing and should not be seen as a selfish act as you are forcing your children to grow up, preparing them for the realities of the real world, and building their self worth that they are fully capable of doing this themselves. So where do you begin? The short answer is–as early as possible! There are also some other tips that I would recommend.

Encourage Your Children to Work and Earn Their Own Money – As soon as they can get their working papers, encourage your children to go out in the real world and get a job. Even if the job is not glamorous or high paying, it is still better to push your kids to work and make their own money as opposed to just supplying them with your credit card or money whenever they want something. They are going to eventually need to find a career path but in the meantime, it is smart to have them gain some work experience which will build their work ethic.

Make Them Pay for Everything – I know this might be tough to enforce if your children do not have a steady job or source of income yet but it is essential to make your children pay for everything from the start. Then they will not rely on you for every little thing and expect free handouts. Is your child at an age to drive a car? Do not give them a free car–have them work for it! In addition, they should pay for their car insurance, gas, and the maintenance costs. If you tell them that they need to pay for these things, they will figure it out. This might mean working a job after school or saving strategically but these are great skills to possess. You want your children to be doing these things. It might take them more time to buy the things that they desire but that’s okay. You want to teach your children to know how to pay for things and put in the work that is necessary to earn everything.

Be Okay Saying No When Your Children Ask for Material Objects – It is understandable that your children are going to constantly be asking you for new stuff. It is important to establish what are actual needs versus wants. Oftentimes, the items are not necessities in which it is okay to say no. If the child wants something badly enough, it is a good idea to teach them the benefits of saving any money that they receive or earn to eventually buy the item themselves because it will always be more valuable when it is earned as opposed to being given things for free. It is also good to say no so that the child learns to appreciate what they have as opposed to becoming materialistic and acquiring too many unnecessary possessions.

Teach Them the Benefits of Both Saving and Investing Their Money – Most children are not wise enough to think about the long term effects of their everyday habits. That is why it is natural that they want to spend money to satisfy their need for instant gratification. However, if they were aware of the benefits of compound interest over time and/or the value of saving money for an emergency fund, they would be be more inclined to start saving and investing at a young age. It is up to you as a parent to teach your children financial literacy, especially considering that this is not a subject that is taught in most schools. The best way to teach this is through example and during their younger years so that they can start making the right financial decisions from the start.

Don’t Let Your Adult Children Live at Home for Free – I know this sounds harsh but adults should learn to become adults. That means taking on responsibilities such as moving out of their parents’ house, paying their own bills, managing their personal finances, etc. When you let your adult children live at home for free, they tend to become freeloaders who have no motivation to work or do anything. Do you blame them? Why work when they don’t need to?! It is for this reason that you should encourage your children to move out and learn how to navigate adulthood on their own. Aside from financial lessons, there are so many other life lessons that are gained from living independently such as becoming more responsible and self sufficient. If you allow them to live at home still, maybe consider having them buy their own groceries, contribute towards utilities, pay rent, and/or do extra chores around the house. This might encourage them to want to move out or at the very least teach them that living at home comes with a cost.

3 Ways to Build Wealth Through Your Mindset

Leave a reply

Whether you want to believe it or not, your MINDSET is your strongest asset in helping you manifest your desires and reach all your lifetime goals. For many people, building wealth is on the top of the list but many people do not know where to start. Time and time again, as I just pointed out from the very beginning–it all begins with your mindset. It is your choice in how you develop your thoughts, so why not think with intention and develop a stronger mindset? The good thing is, it is never too late to develop a positive mindset in regards to how you view money and navigate your financial future.

Believe in Your Money Making Potential – For me personally, making money has always come very easily. Mind you, I have always worked very hard to ensure that I make enough money to be financially independent while also saving for my future. My earning potential has always been abundant not solely due to my deep desire to build wealth but also because I strongly believe that I have the capacity to generate a ton of money. This belief propels me to take the action that is needed to manifest and make it happen. I don’t sit around and wait for the money to fall from the sky because I recognize that the process does not work that way. Maybe for some people, they are not in a position where they need to work or they have someone who can totally provide for them. While this might appear nice on the surface, it goes against my core belief that I am a money making machine. Hence I have never been one to rely on others for money and have always found ways to make a good living where I have enough money for daily expenses and where I can still put money aside for the future. This goes to show that anyone can do it given they have the right mindset.

Understand that Building Wealth Is a Gradual Process – Everyone is looking for a get rich quick money strategy or wants to be rich right now but realistically, most people who have accumulated a substantial amount of wealth will tell you that it was not an overnight process. It is more about how consistent you are with your money habits and setting long term goals which will ultimately lead to a good amount of money. Besides saving money, it is important to invest your money so that it continues to grow and accumulate over time. It is okay if you are starting small or with essentially nothing, as long as you stay on a good path to wealth with the mindset that you are going to continue to keep building wealth throughout your lifetime by your everyday money habits.

Be Willing to Make Sacrifices for the Greater Good of Your Financial Future – I recognize that saving and investing money might not be as exciting as spending it right now but it is ESSENTIAL to get into the habit of holding onto more money than you are taking home. This is a necessity not only for building long term wealth but this habit will allow for you to become financially stable and prevent you from taking on any unnecessary debts. There will always be temptations in your life from having the fanciest car to having designer clothes to wanting to eat at the nicest restaurants or whatever you want to spend your hard earned money on to provide you instant gratification but you need to shift your mindset to believe that you don’t need these things and prioritize your future above anything else while just focusing on your basic necessities as much as you can. That is not to say that you are not allowed to treat yourself from time to time but rather to not let instant gratification be the driving force of your spending decisions. It is better to make financial sacrifices now for the greater good of your abundant future that lies ahead.