LOOK BEFORE YOU LEAP.
It’s a phrase spoken often to the young and exuberant, but one that we forget still applies as we get older…
It is reasonable to assume that you desire financial success for yourself and your family and you may even have your sights set on becoming fabulously wealthy. Some of us dive right in whilst others keep dreaming.
Whatever your goals, unless you win the lotto, you will not move passed average unless you fully understand the elements that contribute to wealth and abundance. Financial success is not a mystical reality shrouded in deep dark secrets known only by a select few.
All you need to do is log onto Google and type in the words ‘how to get wealthy’ and you will see millions of sites telling you what you have to do to become the next super wealthy individual. The problem is that we often make mistakes along the road and these mistakes can take huge chunks out of our resources. Before you take a leap, here is a list of seven common mistakes that we make. Knowing how to avoid them could mean the difference between riches and poverty in retirement!
We’ll keep them in bite sizes so there will be two in this blog, two in the next and three in the last – enjoy!
1. Having a Negative Mindset
There is plenty of evidence to suggest that your parents lay down your beliefs and attitudes towards money and wealth. If your parents believed that the only way you could make money was to work hard for 12 hours a day for 45 years, and only lucky people become wealthy, chances are you have adopted some of those beliefs yourself.
It’s possible that they drummed into you that self-employment was too risky, and having a ‘steady job’ was the way to go; you may feel compelled to hug tightly to the corporate ladder.
This being said, it does not take much research to discover that these beliefs can be changed. So while you may have been indoctrinated to some extent, you do not have to remain entrenched in these beliefs. Many entrepreneurs were spawned by conservative parents; they just chose to do things differently. So before you embark on your journey to build wealth have a close look at your attitude and beliefs towards money and take steps to develop a healthy mind-set.
2. Having No Plan
Once you have decided that you want more for yourself than a pay cheque-to-pay cheque existence, you need a plan in order to execute your goals. As the familiar adage goes; people don’t plan to fail, they fail to plan.
This is particularly true when it comes to building and maintaining wealth and securing your income sources.
People often adopt an ad-hoc way of planning their finances with no real strategy behind their goals. The trick is to identify what you think will make you money, develop the skills to help you achieve excellence in your field and keep learning. Once you start making money you need to learn how to retain it and then invest the money so that it starts working for you.
The world of investing is not complex, however the sheer volume of products available and their respective functions, can be difficult to comprehend. A crucial part in any investment strategy involves the professional and valuable services of a financial planner to help you structure a strategy. The plan should include everything from short, medium and long-term savings, life cover, health cover, income protection, short-term risk insurance and disability insurance. It may seem like a tall order but covering all the bases is a vital part of becoming, and staying, financially strong.
Watch out next week for our next update with two more financial planning pitfalls to avoid!