In our country (Philippines), when “ber” months come, you can really feel the spirit of Christmas not just because of the decors and radio songs, but because of the long ques in shopping malls especially on the month of December. Why?
Christmas Sale! Holiday Sale! Year-end Sale! Here, there, and everywhere!
Many people were in rush on all these sale and promos. Many people are rushing to spend there Christmas bonus, 13th month pay, 14th month pay, and other extra money. For the whole month of December, it seems like a “spend-it-all” race in malls.
What about on the next days and months when cash inflow is almost insufficient for the needs? The anwers: Loans, Credit cards, any means of debt
I know because I was once a contestant of this “spend-it-all” race.
I’m fortunate and grateful that three years ago someone opened doors for me to the opportunities of financial literacy, the way to financial freedom. It is not and there is no quick-rich scheme to financial freedom. It requires the right mindset and consistency.
Start on pondering the difference of needs versus wants.
Needs are things you cannot live without, while wants are things that you can live even without.
*What’s the difference between a 300 peso pair of jeans from divisoria against a 2,000-peso branded pair of jeans? – It gives the same fit and comfort
*What’s the difference between a low-class brand of watch against a signature watch? – It provides the same time
*What’s the difference between a no brand shirt against a high-end branded shirt? – It provides the same purpose
See? These are just few examples where we can choose to spend less inorder to make more of what we have spared.
Simplify your life!
Let me share to you my first learnings of creating ways to achieve financial freedom.
1. Zero-out Your Debts
Consolidate your debts. From your income, create a plan or schedule of payment until it boils down to zero.
“Be scared! Be scared! Be scared! Of borrowing money with interest!”
This is one of the most stricking advise given by Bro. Bo Sanchez on one of his PowerTalks.
Take control of your spending habits. Track your daily expenses for one month. Plot it. Graph it. Whatever you like. This way, you can have a clear vision where your money goes.
2. Create an Emergency Fund
Create a savings account that is equivalent to 3-6months of your income. In case of loss of job, you still have money to cover-up the expenses at least until you find new source of income.
3. Invest in Life & Health Insurance
This will save you or your beneficiaries from huge expenses in times of accidents and sickness.
4. Invest in Mutual Fund/Stock Market
While many people are rushing to sale and promos after they got there Christmas bonus, the Truly Rich people were rushing to the stock market, investing there extra money for long term. At this time of the year, price per share insanely goes down. This investment will soon become your money machines. If you want money to work for you, learn how to do it. Caution! Investing in the stock market is as easy as 1-2-3 but without proper guidance from the experts, it’s dangerous.
Financial freedom requires effort and discipline.
This new year, may you choose to create ways to live a dream life.
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