One of the most powerful tools you have in your arsenal is the power of thought and focus and drive. If you truly want to change your circumstances and you want a better life for yourself and your family, you really can make a change by simply creating goals and figuring out ways to achieve those goals.
I lost a ton of money in the stock market trading on margin (borrowing money I didn’t have to invest in stocks) and the one stock I had (not diversified) went into the toilet one day. Right before they were going to announce earnings, they announced the CEO was doing shady deals and was fired. The visionary of the business was leaving the company.
I lost over $80,000 in a few hours and $100,000 overall. We were renting a house at the time and looking to buy a home for the family. I had a wife and two kids to support and pretty much lost almost all of the money we needed to put down on a house down payment. I sat in the kitchen that morning with my head in my hands and dreaded that call to my wife. What came out of that day was a spreadsheet with a monthly goal for each month to save money and cut spending. My goal was to get it all back in one year. My wife and I went through our expenses, cut the shopping and eating out and I busted my tail on my business. I was able to see each month the amount of money I lost coming back. I almost got it all back by the end of the year and took another two months to get back to even. We were able to buy the house we wanted by the end of that year. I hadn’t saved that much money in a year I don’t think at any other time in my life. I followed up on more leads, got more business from existing clients and made sure we didn’t spend on things we didn’t need. We still went on vacations, but they weren’t to exotic places and we achieved our goal.
What can you take from this example? What are the things I learned during this time?
- How to create a simple plan using a spreadsheet and create a goal
- Work with my partner to review our expenses, cut back on what we didn’t need and only focus on the necessities
- Get creative with how to increase revenues for my business – increase prices, market to existing clients, follow up on every single lead
- Continue to focus on my family with events that allowed us to be together, but maybe not trips to Hawaii
When I was done with the exercise, I maintained increased business revenues, bought a house, spent less and had more money to save. You can do the same if you put your mind to it.
Every single person has a different circumstance and some are in better financial situations than others, but at the end of the day, it’s up to each individual person as to how determined they are to reach their goals. People who have had a more difficult upbringing have dealt with the pains of poverty and might persevere harder than someone who grew up in the middle class neighborhood and didn’t face as many harsh realities. No matter what your circumstance, if you want something, you just need to be determined to get it.
The power of setting a goal will start you on your trek. Maybe your goal is to buy a new house or create enough passive income to retire early. Whatever your goal is, make it specific. If you are trying to buy a new house, how much do you need? If you want to generate passive income, how much do you need on a monthly basis and then how much would you need to do everything you ever wanted to do in life? Having a specific number is important because the tools and resources in this blog will track those numbers every month and year. And as you see your numbers increasing, you will change your habits and your spending and your saving to increase the numbers faster.
Most important, make the goal ATTAINABLE. Don’t start with a goal of passive income of $100,000/month. If you get to $500/month, you might start to get overwhelmed with the feeling you are never going to hit your goal. If your goal is to buy a house and you’re starting at $1 million, you might want to temper your expectations.
On a daily and weekly basis, you will start to think differently. At some point, as you follow this blog, your money will be automatically moved to investments and your spending will stabilize so the one thing that you can do is to look for more opportunities to generate more money in your job or through side gigs or by starting a company. As you generate more income, you will automatically save more or put more aside for investments. Just remember, NEW MONEY IS NOT “FREE TO SPEND” MONEY. You were doing just fine with the old money so just wasting the new money on spending instead of investing will stop your journey up. You’ll just move sideways.
When you reach your goal, there will be a sense of accomplishment that is unparalleled. Trust me. I’ve been there and it’s amazing.