I know I’m just some guy writing on the internet. But I try to put a little nugget in every post I write, and this time I’m going to tell you that you will be happier if your finances are not a mess. At any given moment, I am here to argue, you are investing in either financial stability or financial instability. It may be that you do a little of both and your efforts cancel each other out. For instance, you cancel your Hulu membership to save the $8 a month, but then you spend too much at one of those by-weight FroYo places (I know…I know…it looks so light and fluffy). Making financial decisions with consistency is much harder. Some people seem to have no problem making consistently poor financial decisions, but those who always make good money moves are in short supply.
And it’s a shame, because I believe that an easier time at happiness and contentment is on the other side of financial stability. According to some metrics, only health has more bearing on our health than our financial security. I know everybody says that money can’t buy happiness, but if you’ve ever experienced the stresses of being poor, you know a little money definitely helps matters. So let’s get over this stigma that money, itself, is dirty, and that thinking about and trying to increase wealth is immoral. Wealth can get out of hand, and there are some people in the world who have more than they need. But you are very unlikely to become one of those people. You should focus on building reasonable wealth at all, not worry about what’ll happen when you get it.
There are some pretty basic steps to acquiring wealth, as well as predictable ramifications each step of the way will have on your sense of well-being. Check these out and think about how great it would be to have this kind of security in your life.
- Stop Losing Money – I’m talking about debt. Being in deep debt produces a sensation not unlike the sensation of drowning. And drowning you are, in negative net worth. Each credit card is like a sandbag tied to your ankle, making it more and more difficult to keep your head above water. Dispensing with that metaphor, you’ll have trouble paying the bills and for food, much less for anything in your life you might want or dream of. Being in debt is terrible and it’ll take it’s toll on your health. Adjust your spending and working habits till you can pay it off, and you’ll feel like a 25 pound weight has been lifted off your chest.
- Start Gaining Money. Save and invest your money once you’ve stopped losing it through debt. Savings are meant to deal with your immediate needs, those that you’ll need cash to handle in the next 6-24 months. Investments are meant to service needs much farther down the road, all the way to your retirement. Saving is pretty self-explanatory, but there are thousands of ways to invest. I recommend real estate (in the form of your own home), Forex trading for fast investment, and mutual funds/ETFs for long term investment. Forex is an example of a high risk investment that can nonetheless be mastered. Funds are lower risk, but have much less skill involved in holding them. Together, these investments can give you a sense of financial purpose, as well as a lot of satisfaction. This satisfaction results from real security: from the future, from unknown events and problems, from sudden bills. You’ll feel better because you’ll be, objectively, safer.