Harry Truman once wrote: “In reading the lives of great men, I found that the first victory they won was over themselves; self-discipline with all of them came first.” According to insurance industry statistics, of one hundred people who start work at age 21, by age 65, one will be rich, four will be financially independent, fifteen will have some money put aside, and the other eighty will be still working, broke, dependent on pensions, or dead.
Brian Tracy laments that the primary reason for financial problems in life is lack of self-discipline, self-mastery, and self-control. “It is the inability to delay gratification in the short term. It is the tendency for people to spend everything they earn and a little more besides, usually supplemented by loans and credit card debt.”
It is believed that we are living in the most affluent time in all of human history. There are more opportunities to achieve wealth and prosperity today for more people and in more different ways than have ever existed in the history of man. It has never been more possible for you to achieve financial independence than right now. But you must make a resolution to do it, and then you must follow through on your resolution.
The reasons for financial failure
Surprisingly revealing is the fact that the primary reason why most adults have financial problems is not low earnings. In their book ‘The Millionaire Next Door,’ Thomas Stanley and William Danko show that two families living on the same street, in the same size of house, and working at the same job can have completely different financial situations. By the age of 45 or 50, the couple in one house will be financially independent while the couple next door is deeply in debt and having trouble making ends meet.
The reason for this, Tracy believes, is not the amount of money that they earn. “The reason is lack of self-discipline and the inability to delay gratification.”
This weakness of character is so prevalent among the majority of adults in society today and it goes back to early childhood. As children we loved sweets and did not seem to get enough of it. Many children will eat chocolate until they become physically ill because it tastes so good. As we grew older, we developed what psychologists call a “conditioned response” to receiving money from any source.
“Like experimental dogs, when we receive money, we mentally salivate at the thought of spending this money on something that makes us happy, at least temporarily.”
Spending makes you happy
When you become an adult and you earn or receive money, this automatic reaction continues. Your first thought is, “How can I spend this money to achieve immediate pleasure?”
When you get your first job, the very first thing you think about is how you can spend not only the money you earn, but also every penny you can borrow on a credit card on clothes, cars, cosmetics, socializing, entertainment, travel, and everything else. Your mental equation is money equal to enjoyment.
Psychologists believe that it is quite common for many people, when they are unhappy or frustrated for any reason, to go shopping. They unconsciously associate buying something with being happy. When it does not work as they expected, they buy something else.
Sometimes, unhappy people go on shopping sprees. They buy lots of things they do not particularly need because they unconsciously associate spending with happiness.
As an adult, whenever you receive your salary, a bonus, a commission, or any other earnings, or even a windfall the very first thing you think about is how you can spend this money as quickly as possible and on as many pleasures as possible.
Rewire your responses about money
Tracy believes that the starting point of achieving financial independence is to discipline yourself to rewire your attitude toward money. “You need to reach into your subconscious mind and disconnect the wire linking ‘spending’ and ‘happiness.’ You need to then reconnect that ‘happiness’ wire to the ‘saving and investing’ wire.”
He further advises that to reinforce this shift in thinking, open up a “financial freedom account” at your local bank. This is the account in which you deposit money for the long term. Once your money goes into this account, you resolve that you will never spend it on anything except the achievement of financial freedom.
If you want to save money to buy or a car, you open up a separate account solely for that purpose. But your financial freedom account is inviolable. You never touch it except to invest those funds so that they can yield a higher rate of return.
Associate happiness with saving
Tracy believes that when you begin saving in this way, something miraculous happens within you. “You start to feel happy about the idea of having money in the bank. Even if you open your account with a small amount, this action gives you a feeling of greater self-control and personal power. You feel happier about yourself. The very act of disciplining yourself to save money makes you feel stronger and more in control of your destiny.”
Each time you get some extra money, you put it into your financial freedom account. Eventually, your financial freedom account will begin to grow. Then, as it grows, you activate two laws: The Law of Attraction and The Law of Accumulation.
“Because the money in your account is emotionalized by your own thoughts and feelings, it sets up a force field of energy that begins to attract more money into it.”
The Law of Accumulation says that “every great achievement is an accumulation of many small achievements.” The Law of Attraction says that “you attract into your life those things that are in harmony with your dominant thoughts.” Because of these laws, your financial freedom account begins to grow with THE MIRACLE OF COMPOUND INTEREST.
The more money you have in your bank account, the more energy it generates and the more money is attracted into your life. You have heard it said that “it takes money to make money.” This is true.
As you begin to save and accumulate money, the universe begins to direct more and more money toward you that you can save and accumulate. Everyone who has ever practiced this principle of regular saving is absolutely astonished at how quickly their financial fortunes change for the better.
The rule for financial independence, once you have rewired your attitude toward money, is to “pay yourself first.” Most people save whatever is left over after their monthly expenses—if there is anything left over at all. The key, however, is to pay yourself first, off the top, from every amount of money you receive.
The payoff is tremendous
The reward for saving and investing is substantial. It is said that “happiness is the progressive realization of a worthy ideal.” So every time you save a dollar or pay off a dollar of indebtedness, you feel happy inside. You feel more positive and in control of your life. Your brain releases endorphins, which in turn give you a feeling of calmness and well-being.
Within two years of beginning this process, you will have worked your way out of debt and will have begun to accumulate a growing amount of money in your financial freedom account. As this amount increases, you will begin to attract into your life more money and more opportunities to deploy those funds intelligently so that they yield a higher rate of return.
At the same time, your attitude toward money and spending will gradually change. You will become more disciplined and conscientious. You will investigate carefully before you invest. You will study every aspect of a potential business or opportunity. You will be reluctant to part with money that you have worked so hard to accumulate.
You will actually begin to reshape your attitude and personality toward money—and do so in a very positive way.
BY CAPT SAM ADDAIH (RTD)
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