To lose weight, you eat less, eat well and exercise regularly. To become a better basketball player, you watch videos of pros and practice a lot.
But how do you achieve financial success?
Improvement in any area of life requires focused attention and a definition of success. If the goal is weight loss, you must be conscious of what’s going in your mouth and how much you’re exercising. You must also define how much weight you want to lose. In basketball or any other sport, you must practice (some experts say 10,000 hours is how long it takes to become an expert). You must also watch and play against those who are better than you.
To achieve success, you first need a definition of success. What does financial success mean to you? It’s different for every person. Does it mean being debt free? Financial independence? Retiring at 55? As long as it’s specific and attainable, there’s no wrong answer.
With success defined, you’re ready to make a plan. In it you’ll lay out your vision for the future, how you’ll get there and how long it will take. Your values should drive the plan. Do you tithe? Do you like having new things? Do you have other financial commitments to meet before you start the plan? Just like the old saying, “If you fail to plan, you plan to fail.”
A key piece of the plan should be creating separate savings accounts for your goals. Mint and SmartyPig are two excellent resources that help you visualize progress. I have a different method though. I use simple savings accounts with an online bank. Right now I have five accounts, one for each of my goals. My accounts are all together on the same page, so I can see at a glance how I’m doing. I’ve found that if it all sits in my checking account I’ll spend it quicker than Speedy Gonzales.
Control Your Cash
When you’re deep in debt creditors demand your money each month. When you don’t have values, anybody can come along and tell you what to do with your money because you shift with the tides. When you don’t have a vision and a plan, your money is at the mercy of spontaneous whims, spur of the moment decisions and unbridled emotion.
Do you want these to be controlling factors in your life? Not if you’re living with purpose! The secret to financial success is to define success and then direct your money there.
Don’t let whims, flavors of the week or financial salespeople dictate what you do with your money. Define success and have a vision of what you want the future to look like. Then you’ll be in control of your cash and on the way to financial success.
Photo by garmaonhealth.com