Be Smarter With Your Money: Establish a Savings Habit

Establish a Savings Habit

Do you know a person with money? I do. In fact, I know him personally. He has read all the books on personal finance and attended all the seminars, workshops, and private coaching meetings. He has read The Richest Man in Babylon, Think and Grow Rich, Rich Dad Poor Dad, and a host of other books. Why didn’t he develop a savings habit?

One day this young man was with his tax guy and his tax guy yelled at him. The tax guy said, “You made a six-figure income last year and what do you have to show for it… NOTHING!” The young man was speechless. What could he say? He knew he was not smart with his money.

I know the young man because it was me. It doesn’t matter how much money you make. Blue-collar workers and athletes lose their money. Entertainers go broke, business owners go broke, and everyday professionals lose their money. You chide how athletes blow through millions of dollars in a few years and file bankruptcy. You say that if you had that much money you will never be broke.

Truth be told, if you can’t manage your money now, you couldn’t manage the millions the superstars have. Now this is not due to a lack of information. There are plenty of personal finance books, classes, and systems out there. You know you should have an emergency fund, a savings fund, and investing fund. Delayed gratification is a loss. You know you shouldn’t be going into debt and spending all your money. But you still do it.

Don’t Go Broke

I know about paying yourself first. But I never did. I would spend because I thought I could make more money later. You may have that same problem. But when the real estate market crashed, I did not make any sales, lost my corporate job, and I had no savings. I cashed out my 401k and burned through that six months later.

According to statistics 76% of people who receive large lump sums of money file bankruptcy. From my experience working with other entrepreneurs, real estate agents, independent contractors, and employees. The most successful people in their fields develop a habit of saving. They always pay themselves first.