What is Holding You Back From Being Financially Free?
By Jeff Earlywine
For many people, growing your net worth and becoming financially free is a desperate sought after desire. However, something seems to get in the way. It is almost as if when things begin going really good, something bad happens. In other word, you take one step forward, but slide back two. For instance, you are beginning to save on a regular basis and then the car breaks down draining all that savings. Sound familiar?
Below are few reasons why many people get held back financially.
Not PLANNING for the storms to come
We also know it will rain again some someday, both in the natural and in our financial life too. Even in ancient Bible writing we see this – the story of Joseph. The story goes something like this. Joseph was in prison, but was requested to attend a meeting with the ruler of the land. The ruler asked him to interpret a dream – a very odd request. Joseph told the ruler that for next several years things would be great, but after that famine would hit the land hard. He must have been convincing, because the ruler took him out of prison, made him second in command, and followed Joseph’s plan – a plan to save all they could for the next seven years.
In our lives we need to follow this same advice. You do this be having a plan to live by when things are good, preparing for when things take a turn for the worse. To do this you develop:
1) A savings plan
2) A spending plan
3) A sharing plan – allowing you to give more when you have it
You also must live within your means (not your neighbor’s).
Not PREPARING to take advantage of every opportunity
Being able to take advantage of sale prices can help the family’s budget tremendously. When should you take advantage of the ½ price sale? Great question – when you have the extra money, and would need to buy the item anyway. When shouldn’t you by that sale item? Another great question. When you don’t have the extra money, and it is a true “want” not a need for you and/or your family.
PAYING too much of… the list could go on and on, but here a few.
1) Interest – We all know that debt is too easy to get. Credit cards often charge over 20% interest, and the “Buying now, and paying later philosophy” is common in our culture
2) Taxes – The average family pays 25-50% of what they bring home in taxes. Something that can help you reduce this is to start a small home-based business.
3) Depreciation – especially on automobiles. Example… You buy a nice, new care for $25,000, you drive it for 2-3 years and decide to trade it in on another nice, new car. You really negotiate with the car salesman to get the best price possible – and you feel so good about it, then you mention your trade in. The salesman happily agrees to have your car looked at. He comes back to tell you that they will give you $12,000 for your car [he would word this that they will take another $12k off the sales price of your new car]. You invested $25,000 2-3 years ago, and now your investment is worth $12,000.
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