We all have this dream of financial freedom. Having enough to never need to work again. Having enough to simply do the things we want, when we want, with who we want minus the stress of money worries weighing us down like a tonne of bricks.
Yet for many, this sounds like a dream than a distant-but-totally-achievable goal. It almost sounds too good to be true but that’s because we waste so much of our money (and time) on stupid things. On things we kid ourselves will bring us closer to financial freedom but in reality put space between us and our freedom.
We become fixated on higher and higher salaries since we have this silly perception that more earnings = more freedom.
We assume the more we earn, the more money we’ll have and the richer – and better off we’ll be. This is one of the biggest lies we tell ourselves. More money simply means our habits will be magnified. It goes both ways, I’m afraid.
Lifestyle creep is, well, a creep!
As we earn more, most of us are guilty of upgrading our lifestyle until we find ourselves working harder than ever before all to meet this new level of living.
Now, our earnings are met with ever more stress, late nights, lost opportunities and time gone by. More earnings for the sake of keeping up with your higher and higher living standards isn’t going to get anyone anywhere. Read here the shocking truth why 36% of America’s high earners are living payckeck to paycheck!
What we mean when we say more money is more bills. Bigger, fancier houses with faster, flashier cars. When we earn more without making an effort to think twice (or at least once) about where our money is going to, it usually ends up in places that do us most damage.
More money acts as a habit-multiplier
We earn more, we spend more and we have buy more debt. From credit card debt to car loans to whopper mortgages. All the money we earned suddenly has us chained to our jobs (which is usually our only source of income – read here the 3 simplest ways to boost your financial resilience).
And if that were to go down the pan, well you can pretty much kiss goodbye to any sort of freedom since the debt you’ve accumulated will start to snowball. Read here why credit cards can be so crazy (and cool) plus how to avoid sliding right into that consumer debt trap.
Welcome to lifestyle inflation. It’s dangerous, deadly and definitely contagious!
See, we don’t like to be different. We may not admit it to ourselves, but we desperately want to fit in. We want to do what everyone else is doing and buy what everyone is else buying.
So it’s literally no surprise that the minute we earn more, we blow it on stuff just to look cool (and rich, of course). That’s what seems important to others – and so to us, too. We waste so much time and lose so much sleep all to earn yet more bucks that we don’t stop and think what we should really be using all that extra money for!
If it ain’t being used to build that nest egg of yours, well, honestly what’s the point then?
Earn more, take on debt, work more, take more debt, work more and so on.
If your earnings simply serve as a corridor for yet more debt (mortgages, car loans, credit card debt, you name it), well you really aren’t free at all. You’ve become a slave to your debt. To your desires.
Month in, month out you’ll be paying it off. And you end up working harder now that your wants have become needs. This is how 99% of people live. Dare to be the 1%.
You’ve gotta be okay to be different. To do things no one else is really doing and to not do the things most people are way too busy with. The goal should not be a higher salary for the sake of it but a higher salary to fund your future.
A higher salary to invest more with. Not to spend more since spending kills freedom. Cultivate it by investing. By turning your money now into more money later. Read here what to do the minute your paycheck hits your account.
Invest more now, focus on earning more later
Focus on investing as much of your salary as possible. More investments means more freedom. Investing in assets will set you on the path to freedom. Investing in things that give you money (assets) over things that take money away from you (liabilities) will allow you to have greater control of your financial future.
Through the sheer magic of compounding, your nest egg will (over decades, not days!) grow into something father beautiful.
The world is filled with endless opportunities to make money. It’s never too late and definitely never too early to get started! But better to have invested late than to never have invested at all.
All the people I know that have reached a state of financial freedom have done so by putting their money to work and not living like others. They didn’t spend willy-nilly. They put their salary to work. They didn’t take time for granted. They used it to their advantage to build their future, fund their retirement and sponsor their dreams.
They made their money work darn hard for them. They were ridiculously patient and delayed short-term gratification (ahem, that Gucci handbag) for long-term freedom (time).
Do the hard things now to have an easier life down the line. Or, you could simply follow the crowd and do what’s easy now but suffer later with the consequences of your choices. It’s up to you.
Disclaimer: This blog is not investment or financial advice. It is my opinion only. This blog is not a personal recommendation to buy/sell any security, or to adopt any such investment strategy. Always do your own research before you commit to any investment.
Knead Your Dough 