Spend Less Than You Earn

Posted on May 9, 2008
Filed Under Category00: Mindsets of Getting Rich |

I am amazed at how many people I meet are spending more than they earn. Many people do not follow this most golden of all the golden rules. That is,
• spend less than what you earn
• live within your means
• do not get stuck in a ‘Hand-To-Mouth’ situation
• create a little bit of savings for rainy days!
• create savings from which to generate more income (you can’t breed more chicken if you sell all your chickens!)

This mindset I want to push across does not contradict with my earlier post, “Penny Wise, Pound Foolish”. By the way, you should live within your means, but live well enough to be happy. If you don’t earn enough to have a nice luxury car to drive, then drive a simple Korean-made car. If you can’t earn enough to drive a car, then, don’t own a car; take public transport.

This mindset is about being informed and in control. The biggest mistake is not knowing what you are doing, where you are financially, and what is up ahead. Know your profile, know what you want and what the profile said you can do, and act on it with plans, goals and determination. If you have not analysis your profile, please do so.

The Jar Money Management system from T. Harv, again, could help you kick the bad habit of ‘spending more than you earn’. In the money management concept of T. Harv, you are supposed to put aside money for savings, education, etc. and a budget for spending on your pleasure and the things you want to enjoy. It helps you to plan, and slowly but surely, you will adopt the discipline of spending your money wisely. You will start to develop the habit of knowing what you are doing and where you are financially. Isn’t this habit a habit that we all find in public corporations and companies? Yes, we all need to be accountable to ourselves. If we are not accountable to ourselves, how can we be able to look after a huge organization? The habit starts within ourselves; i.e., managing ourselves.

Some people tell me this: “But you see, I do not have the skills and education like you have do, to earn enough money.” I say this is bullshit If you have that mindset of not finding a way to earn more, you will not have more.

There are many ways to earn more:
1. Educate yourself by learning new and more skills that can help you generate more money.
2. Have a second stream of income, such as MLM, Internet Marketing, and more; this can be done after office hours.
3. See if you can JV with some of your family members to start some businesses. They can be full time, and you support them part-time – like on weekends.

I see people complaining that they don’t have enough time to do my suggested method above, and yet they spend lots of time wandering around pubs, loitering in the streets, drinking away, wasting time. I guess they do not have the needed motivation. So, getting rich is a decision…a mindset you need to cultivate. Once this is in your mind, and your desire and passion are in your body, you are on your way to success –regardless of whether you have money now or not.

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