Robert Kiyosaki describes the financial problems of our time as “being caught in a rat race”. Every day we are running and striving to make great strides in our financial lives. As hard as we are running, however, we ultimately end up in the same place that we started; our results not showing the amount of effort that we are putting in. This is because we have all been lied to. We have been made to believe in this lie so heavily that it is engrained into our everyday lives, it is in our belief system. That lie is Debt.
Dave Ramsey asks his listeners and readers, can you imaging life without debt? A student, without a loan? A car, without a note? A home, without a mortgage? Can you picture going to make a purchase without using a credit card? or going into a store and paying for the items in your cart with your bank account/cash. Many of us cannot. We live life with a notion of financial stability as making all of your minimum payments, and making them on time. It’s not until those payments start to cause us pain, that we start to see the effects of debt.
If I were to tell you that gaining financial peace is within your grasp and you can have it, would you believe me or would you cling to the belief that you have to have debt in order to survive in life? The truth is, financial peace is within your grasp and you can learn how to obtain it. The question is will you do what you need to do in order to get it?
Over a decade ago, I began my own financial journey. I was determined to reach the picture of financial peace I had in my mind. For years, I had bought into the lies and the myths about money. I had several credit cards, that I was making the minimum payments on, I had a student loan that was around for years, going form forbearance to forbearance, and a wonder of how to get by until the next payday. This was not the financial peace that I sought. What I was looking for was the ability to maneuver through my life, without worrying how I would afford it. I wanted to buy a gift for my wife, or take my children to a movie without worrying if the rent check would not clear. Financial peace for me meant, being able to afford the life that I wanted to live. Today, I can honestly say I have reached financial peace.
How’d I get here, you ask? It started with a quote from Abraham Lincoln. “If I had 8 hours to cut down a tree, i’d spend the first 6 hours sharpening the saw.” This quote is more commonly attributed to Author Stephen Covey in his book 7 Habits of Highly Effective people. Habit 7 is Sharpen the saw! Continuing to grow and develop myself has helped me to get to this point in my life. Here is a few things that I learned about finding financial peace.
1. What is your definition of Financial peace.
According to Cashcow, one definition of Financial Peace is being able to afford the lifestyle that you want to live. In order to to live that life you must define it. Chris Hogan, author of Retire Inspired, says you must dream in HD, and create a plan to get there. On that journey to live out your plan, is where financial peace is found.
2. Debt is Dumb
Dave Ramsey Asks a question to his audience that completely made sense in my head. If I were to hire you, to fix your own financial life. Would you continue doing the same thing as you are doing? Probably not. your first step would probably would be to eliminate debt, and increase savings. So why then, is this the hardest thing to do. Society thrives on debt. If you ask anyone what is the number one resolution in the world, guaranteed they will say get out of debt. So let’s start our financial journey there. Get it in your mind now, that debt is dumb. You don’t want or need debt.
3. What happened to the cookie jar?
My grandmother had an actual cookie jar on top of the fridge where she would put cash “for a rainy day.” Today, most people use credit cards/debt (if you really need to know why this is a bad idea, look at number 2 again). I’m not suggesting going back to a physical cookie jar, but having a stock pile of cash around for a rainy day, is a great idea. When you’re in debt and an emergency happens the last thing you want to do is go deeper into debt. there a several notions of where your cookie jar should be, the bottom line, though, is you need to have one.
4. Have a map to your destination.
Today, when we set off on a trip, the first thing we do is set the address in the GPS so we can follow the route. Winning with money takes the same types of strategy. A GPS for your money is called a budget. Just like you wouldn’t start a trip without a either a destination in mind or a map to get there, a month should not be started without a plan to help you meet your financial goals for that month.
5. Take control of your Wealth building tools.
When I first read Robert Kiyosaki’s book, I fell in love with his idea that your assists should be your wealth building tool. But I didn’t like how he got there. The concept, however, is great. Chris Hogan, put’s it like this. If you build enough wealth (earning at least an 11% return on investment), to where you can live on 6%, you will never touch the principle. Your assets at that point will be buying your wealth building tools and funding your life. Before we get to that point though, our greatest wealth building tool isn’t currently working for us. It is working for Visa, MasterCard, Discover, Wells Fargo, Bank of America, Salley Mae… etc. If we can take back our biggest tool, then we can start to see and make a difference in our worlds.
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Corey Stokes 