Here’s a seemingly counter-intuitive finance lesson it took me a long time to learn:
You will never get rich by saving money and focusing on your bills and expenses is scarcity thinking. Let me explain…
In order to achieve abundance in your life, you have to first believe in abundance. You have to believe that there is more than enough money out there for everyone and it’s just a matter of doing what you need to do to get it.
Focusing on your expenses instead of increasing your income causes you to be limited in your thinking. Your attention and mindset turns towards limiting money going out instead of maximizing money coming in. Thoughts like spending is bad, you must cut back, there won’t be enough to pay your bills, etc. Scarcity focus.
The truth is, saving money will likely never make you rich. Lets say you save $2,500 a month, which is an extreme amount for most people, that’s $30k a year you’ll be saving. It would take 33 years to get to a million dollars only to discover that the money won’t be worth nearly a million dollars in 33 years. Sure, you can compound interest on that at say 5% a year and get there quicker, but inflation and taxes will still bring you back down to reality.
Now, I’m not saying not to save money. Trust me, I’m as frugal as they come. What I’m saying is, it shouldn’t be your focus because you will get what you focus on. If you focus on making enough money to cover your expenses, you will do so and still be living check to check like most people are.
You have to focus on abundance, on opportunities, on things that will produce wealth for you. Leverageable events that can deliver a big payout or a series of payouts.
If you want to attain wealth, the money you save should be viewed as capital. It should be viewed as money you have to put up as a good faith deposit just to be able to leverage other people’s money. It should be viewed as money you can afford to lose in order to take the risks needed to attain wealth. And you WILL take some losses, but who cares? You can get more money, but you can’t get more time and you likely can’t get back opportunities you miss out on.
To attain wealth, you need to invest in or build something that the world values at a monetary level consistent with the rewards you need to be wealthy. Read that again and think about it. Then leave a comment below :-)…