Planning for and building wealth is actually quite simple. The process doesn’t require much more than addition and subtraction. That’s right, no multiplication, division, or algebra. The process does not require some sophisticated level of understanding of investment markets or tax law. You can almost plan for building wealth by counting on your fingers. The hard part is the establishment of or breaking habits, and habits can be a pesky thing.
At a basic level, the habit of saving is the root of wealth building, and you wouldn’t be alone if you played mind games with yourself in an attempt to establish savings. Have you sent funds from your paycheck to an account without a checkbook or debit card to keep yourself from dipping into that account? Have you ever decided to open an account in another city so that you can’t just run over to the bank or credit union and grab funds? What you are really doing is fighting your inability to have money sitting in savings without succumbing to the urge to dip into it.
The habit of saving ain’t for punks. A pivotal breakthrough in your effort to build wealth is to establish a habit of savings and just let that money sit. I suggest that you give yourself full access to those funds via a debit card or whatever, and just man (or woman) up. Think about the comfort that you will enjoy by just knowing that you have $10,000 or $20,000 just sitting without some pesky bill collector or expensive shoes waiting to gobble it up. Keep in mind, a rich person isn’t rich because they have expensive cars, big houses, or a bunch of stuff. A rich person is rich because they HAVE money…yes…HAVE money. You know that, but do you really, based on your saving and spending habits?
No matter how you slice it, the habit of saving is the root of building wealth starts with the habit of saving, and the only way to do this is to spend less than you earn, bank that surplus, and resist the urge to spend it. Set a savings goal, and a monthly financial meeting with yourself. Evaluate your savings performance since your last meeting and decide if you need to fire yourself based on your performance since your last meeting. Breaking the habit of dipping into designated savings and creating the habit of being comfortable with money sitting without spending is the beginning of building wealth.
