Adding more income will never solve your financial problems. Because I am not wise enough to condense these complex issues into one sentence, let me explain:
Your Money Money Should be Working for You
Money is neither my god nor my devil. It is a form of energy that tends to make us more of who we already are, whether it’s greedy or loving. Money is the Fuel, Not the Steering Wheel.– Dan Millman
Having been brought up in a 9 to 5 family, the value of hard work was drilled into us from an early age. So it comes as no surprise that my adult life I spent every available hour working to be on top in order to make more money.
Adding more fuel to an engine gives it the ability to run faster and longer, but it won’t change the direction you’re driving. After 15 years of the 9 to 5 work weeks, I had come to realise that even though I was earning more I was not that wealthy. In fact, I had nothing of real value, which meant I needed to keep working to survive.
Pareto’s Principle or it’s commonly known the 80:20 rule is the idea that 20 percent of your actions lead to 80 percent of your results. For many including myself, we have to do 80 percent of work only to be rewarded with 20 percent of the gains. This was the point that I realised something needed to change, it’s about getting the most from your time and effort, maximizing your results, and having focus. My focus was on how to use the money to work harder for me.
In my opinion real wealth is not the monthly paycheck I received monthly. Real wealth is measured by your assets, by that, I mean how the equity you’ve built is contributing to your financial well being. If I were to quit my job today are my assets generating an income so that I would not need to work? If the answer was ‘yes’ then that would be by definition of wealth.
Address Financial Literacy First
Fears are educated into us, and can, if we wish, be educated out.– Dr Karl A. Mennings
So many people believe if they just made just a few thousand more there problems would be solved. Many set their sights on being the next billionaire. How often we have seen wealthy celebrities, with the world’s attention on them earning million-dollar contracts only to find themselves a few years later bankrupt. They are two aspects that many people are struggling financially. First, they have limited financial knowledge, and second, the have a weak spirit or motivation.
The South African Research Chair in Poverty and Inequality Research (SALDRU) is focused on a sustained program of research to measure and analyse the unfolding social dynamics within contemporary South Africa with particular attention being devoted to poverty and inequality dynamics. According to a SALDRU, South African households earning at least R58,753 (R570,000 annually) after-tax annually are bringing in 99% more than the country’s median household income. Disregarding the enormous wealth equality in this country, let us take a look at the USA. Middle-income households are on average bringing in $60,000 (est. R890k annually). While the top 8% is bringing in over $200,000 (est. R 2,9 million annually). While we can’t compare our economy to an economic powerhouse like the US, we can agree that as the global economy the majority of us have very little room to navigate, which limits our choices and opportunities. When you take into account that 20% of South Africans live from paycheck to paycheck it’s easy to assume that the average income earner will not be able to live off retirement alone.
Financial education and financial literacy are not only subjects never taught in our school system, but they are also rarely discussed in the adult peer groups and are often a taboo subject in social settings. Even if you are one of the few who despite those hurdles seek out the education, it is hard to know where to look and whom to trust. Because of all these factors, few subjects have more ignorance around them than financial education. Unfortunately, this attracts scummy con artists who prey on the masses of ignorant people looking to improve their lives.
It’s Possible to Learn & Change Your Ways
I have about concluded that wealth is a state of mind, and that anyone can acquire a wealthy state of mind by thinking rich thoughts.– Andrew Young
Fortunately, we live in an age where knowledge and teachers are accessible from anywhere in the world. I believe now more than ever, people have access to more free, unconventional education. For example, if your eyes have made it to this part of my article, you are already on the right path. Every person’s story is different, so every person’s education will be different. It works on a case-by-case basis, but if there is one thing I am sure of, 50 percent if not more of the battle is simply understanding that the solution to your or anyone else’s financial problems lies with your mindset the rest of the battle is taking action.
Once you have made that determination, your mindset will begin to expose how to use the energy of money to do more good, be more loving, grow your wealth exponentially, teach others to do the same, and eliminate the negativity that comes from financial burdens. I hope and believe this article will have a ripple effect through all those who read it.