Categories: values, personal finance, net worth
“A man is rich in proportion to the number of things he can afford to let alone.”
Henry David Thoreau
Only you can decide what you want to focus on in your life. It is up to you to choose whether to live to “keep up with the Jone’s” or to determine your own priorities. Thoreau was a master at living life according to his own rules. If you set the rules for your life, including what you want, how to spend your time, how you spend your money; then you can define your own happiness.
Main Topic
I have spent many years managing money, both personally and professionally. My personal finance background includes an MBA and work experience in the financial field. Here are the basics I have learned about money and life:
ü Making your money grow is more about time than anything else.
ü Start as young as possible and you can build substantial wealth.
ü Managing your finances can be broken down into a few simple steps; it does not need to be complicated.
ü Happiness comes from what you choose to focus on!
ü After your basic needs for food, clothes, and shelter are met, more money does not equal more happiness.
ü Your net worth does not equal self worth or serenity.
OK, if this sounds way too simple, indulge me for a moment and read on. Think about some of your habits, both good and bad; i.e. eat chips for a snack, leave clothes on the floor after taking them off, put off work until the last minute, brush your teeth twice daily, avoid activities you don’t like, give to charity, listen carefully when others speak, work-out, or do volunteer work. I’m sure you could list scores more. Now, some of your habits are really productive and work for you like brushing your teeth twice a day. Whereas, if you eat too many chips too often, you get fat, high cholesterol, and heart disease.
The premise of BarbaraFriedbergPersonalFinance is quite simple. Learn good money and attitude habits, practice them regularly and improve your life. Many of you don’t have the knowledge of information to improve your mental and financial life. If you stick with me, every blog entry will give you a small task to practice which will improve your financial literacy and your money management HABITS. Let me be clear, the personal finance you will learn is not just my opinion. NO, it is informed by research about WHAT WORKS. You will also find that people selling you financial advice to make a profit for themselves are not selling you the best products for you!!! In a nutshell, you are going to learn to manage your money so you will have enough for what’s important to you and some left over for future spending. Finally, you will learn to handle all money tasks FAST and make many of them AUTOMATIC.
Now what does all this have to do with happiness. Happiness can also be practiced and learned! I’m not saying that you will never feel negative emotions, because that is impossible or even desirable. What I am saying that you can learn to create a happy mindset for yourself and increase your life contentment!
Practical Application
I want to help you get started today. Because the sooner you begin developing sound money and contentment habits, the better your life will be. So let’s get started with some personal finance 101. When you are trying to lose weight, you usually begin by stepping on the scale to find out how much you weigh. That is how you measure your progress!
In personal finance, no matter how scary it might be, you have to begin where you are right now, not where you wish you were. That means, taking stock of how much money you have if you sold everything and converted it to cash. Simply put, it means adding up-
WHAT YOU OWN:
ü Bank accounts
ü Savings accounts
ü Brokerage/mutual fund accounts
ü Retirement accounts
ü Value of your house
ü Value of your car
And then subtracting-
WHAT YOU OWE:
ü Mortgage loan
ü Student loan
ü Credit card debt
ü Other debt
What’s left is called your NET WORTH. If the final tally is positive, that’s good, you own more than you owe. If the final result is negative, you owe more than you own. And, that’s a problem.
Just like stepping on the scale is sometimes unpleasant, the same is sometimes true about completing your Net Worth.
In fact, by now, you may be thinking that figuring out my Net Worth will definitely not make me happy! Don’t worry, I get it.
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How Can Personal Finance Make You Rich and Happy? Learn to be mentally and financially in control Save for your future systematically Develop mental skills to increase life contentment step-by-step START NOW Wealth and happiness will follow |
Before you get to the Rich and Happy part, you have to pay your dues and go through the struggle; just like success in weight loss, success in your job, or learning a new skill. The happiness comes after you face up to reality and start stepping towards money and life control.
Action Step:
Get a notebook and label it: “(your name) Personal Finance” and keep it by the computer. Use it to keep all of your personal finance thoughts, activities, and plans.
