What is your view on wealth?


Each of us views wealth from a unique perspective. To one-person wealth may mean having enough to do whatever he or she wishes. To another, it may mean freedom from debt. To yet another it may mean the opportunity to grow and to achieve. To the majority who probably haven’t spent too much time thinking about the subject, wealth is simply symbolised by one word: Millionaire. Now there’s an exciting word! It rings of success, freedom, power, influence, pleasure, possibilities and benevolence. Surely, being a millionaire is not a bad mental image to hold! – Jim Rohn

You can positively change your life in any five years. From age 35 to 40, age 23 to 28, age 59 to 64 and so on’. Before looking at where you want to be in life over the next 2 to 5 years it is important to look at where you are today, and how did you get here?

It is important to know that you will not be able to transform your financial situation overnight. Where you are financially today is an aggregate result of the decisions you have made over the last 5 to 10 years of your life.

Just as you should not expect to get rich quick overnight, you should not expect to become a financial wizard overnight either.

However – The truth is…

The difference between a rich man and a poor man is the way they think. In the beginning be prepared to do a load of stuff you don’t get paid for – so that in the future you get paid for a load of stuff you no longer have to do.

The fact that you’re reading the content of this document sets you apart and ahead of 90% of the population.

Most people earn enough money to get into debt, but not enough to get out of debt.

Imagine you want to lose weight, you could eat less, or workout more. But, if you want to get even better, faster results you can eat less AND work out more. A similar law applies in wealth creation. If you want to build wealth, you can spend less, or earn more. But, if you want to get better, faster results you can spend less AND earn more!

You can’t always control how much you earn, but you can immediately control your spending and what you do with your surplus money. You are always going to work on growing your income. But if income growth is your focus you might end up earning more and still be broke at a higher level. There’s nothing gained by earning £100,000 a year and spending £100,000 a year. All you’ve done is raised the bar of your expenses and skewed your wealth calculation to now fewer years to live off your savings / pension. So, it is imperative that you get control of these first two topics right off the bat.

How to spend less – Whilst making MORE!
When it comes to maximising the money you have available to you,
is it best to scrimp and scrape or,
is it making sure you earn to maximise your way forward?

Nearly everyone who’s ever read an article on personal finance can tell you to ‘spend less than you earn’. Whilst that is great advice and following it will put you on solid financial footing, you need to go a step beyond to start making progress towards your goals. It’s this next step where the finance options start to diverge in to two main camps.

Spend less

Spending less is the easier of the two options. If you want to cut £100 of spending out of your monthly budget you can simply stop eating out so often, quit buying rounds of drinks, or make smarter consumer choices like switching utility providers. Cutting out spending is faster; you can make changes and see results immediately you will reap the monetary benefits by simply making a telephone call.

The problem with cutting spending, even to extremes is that there is only so far you can go. Yes, you can cancel your TV subscription, start biking to work and eating nothing but pot noodles for every meal. But at the end of the day there is only so much you can cut out of your life.

Don’t get me wrong, spending less works. Depending on your goals it may be all you need to do to reach them. We have the utmost respect for people that live a prudent lifestyle to be able to save to achieve their financial goals. But, what do you do when you hit your goal? Let’s look at earning more monthly money…

So, maybe spending less is not the answer to all our financial problems.
Let’s check out how we’d fare making more money!

Some people lean towards spending less because earning more can be hard. Let’s face it, if it was easy, we’d all be making millions and shopping in Monaco. That doesn’t mean that earning more is impossible by any means. It can be easy as selling some of your old stuff on eBay, as hard as starting your own business, or as uncomfortable as asking your boss for a pay raise.

The best part about earning more money is that the sky’s the limit to how much you can earn. Whilst there are only so many things you can stop spending on, there is no cap on how much money you can possibly earn or how many income streams you can earn from.

Whilst we all want more money, there are some drawbacks to counting on earning more to reach your goals. For starters, making more money takes time. Even if it’s just something on the side, building a business takes time and sometimes money, to get started. Making more money is also less certain. While we all know that cancelling out TV subscriptions can save you a tidy sum every month, we can’t be sure it’s sustainable.

Which side to choose?

As is obvious, it’s going to be a combination of both schools to meet your financial goals. You can earn all the money in the world but if your spending is out of control you’ll end up in as much financial trouble as anyone making next to nothing. Just look at all the pro athletes that end up broke a few years after their playing days are over. On the flip side, cutting your spending down to the minimum will save you more money, but you’re never going to become a millionaire if you don’t make some decent money as well.

Cutting the dead weight out of your budget and getting a handle on your spending will put you on the right track. But getting motivated and finding ways to increase your earning power will really propel you towards the goals you’ve set.