When I was in my twenties, I was approached by an agent from a reputable insurance company. He offered me an opportunity to invest in a fund that provided both insurance and investment opportunities, and I took it. I wrote one check, opened the account and then never paid another dime. If I had continued with that plan–instead of buying expensive clothes, instead of buying luxury cars on a small salary, instead of eating in fancy restaurants–if I had stayed in that fund faithfully for the next 40 years, I would be a multimillionaire.
My problem was not that I couldn’t afford the plan. My problem was that I was not thinking the right way. People who know me know that I say, all of the time, don’t let the future catch you by surprise. My insurance story reminds me of the biblical parable of bags of gold in Matthew 25:14-30.
There, a journey man is entrusting his wealth to his servants. He gives five bags of gold to one, two to another and one to the last. Upon his return, he discovers the servants with the most gold both doubled the man’s wealth while the servant who was given only one bag buried it in the ground and gave it back to him. He calls the first two servants “good and faithful” while he calls the last “wicked” and “lazy.”
In the end, we can come up with all kinds of excuses for why we’re in debt. But until we change our mindset, take responsibility, and adopt a strategy for changing our situation we will remain in a wicked, lazy state while others prosper.
Getting control of our finances is empowering. It’s also much more than just paying off debt and getting better interest rates. You have to have a strategy or you’ll end up like professional basketball players, who make plenty of money yet 60 percent of them file for bankruptcy within five years of retirement. The reality is, if you make $500,000 per year and spend $500,001 per year, you’re broke. That’s a whole lot of wasted bags of gold.
So, you have to know your wants from your needs, you have to plug spending leaks, you have to have a budget, you have to review your debt paydown to revise it or stay on track, and you have to think about how you can generate new income.
Not only do you have the power to take money you’ve saved and pay off debt (from cutting down on wants, plugging spending leaks and using the snowball method to stop making just minimum payments), you have the power of increase. You have the power to look at yourself and figure out what you do well, what you love to do and who will pay you to do one of those things.
We live in a service economy. There are people who will pay for just about anything. People will pay you to water their plants, walk their dogs and cats and wash their cars. I have a buddy who has a big water tank on the back of a truck and he’ll come to your house and wash your car. Whether it’s baking sweet potato pies or drawing nice art that people will buy, you can use your gifts, talents, skills and passions to connect to people who will pay you enough for a second or even a primary job.
You can use the power you have to access financial management resources, many of which are free like the Billion Dollar Challenge. When I was working to change my life by changing my finances, I had to track things on paper. Later, I was able to open an account with an online investment company and now I buy and trade stocks on my phone. Today, nobody should feel powerless because resources are available and ample. When we feel powerless, we feel hopeless. When we feel hopeless, we don’t even look for solutions.
You have the ultimate power over your own life and you can deal with any obstacle or challenge if you have a strategy. Won’t you join me today by becoming a victor, instead of a victim, of your finances?