Thursday, 15 June 2017

Malcolm's money tips:

You don't have to be wealthy to enjoy a life of financial liberty. You don't have to be a hippy to take yourself out of the consumerism equation and call a veto on ALL brand name products. I just want to clarify, right here at the start, that I am not wealthy but then again I'm not out on the streets either. I've been headed toward bankruptcy a couple of times in my life and have pulled myself back from the brink by cutting back on out-of-control spending, honing budget skills, boosting income, ditching credit cards, changing my belief patterns about what I thought I needed and directing money toward better investments. I had to force myself to become more frugal, more pragmatic.

The last time I worked over 50 hours a week for another person was 1991. I have also raised four children and we managed to do it mostly on only a couple of income streams. I now have my second grandson on his way and am thrilled that I can offer my assistance pre-natally and afterward to my daughter. Being hands-on with my children was always my first priority. Their father and I decided back in '94 that one of us would always be at home for the kids and I have stuck by that promise. I have also spent countless hours working in my own businesses rather than for someone else and wouldn't have it any other way.

Most people I know who have accumulated wealth by middle age have either opted to not have children (they have a dog) or have worked extremely long hours, seven days a week in a job that is often hated. That's a huge chunk of your life given away just for something called money! It's kind of like selling your soul down the river, really. It's okay if you have the workaholic gene but what about the rest of us who insist on work/life balance?

Don't get me wrong, I'm not advocating a life begging on the streets or parasitising off others or the government instead of hard work. No, that's not what I'm saying at all. If you want to work your entire life in one job and you have the determination and tenacity to see it through, then kudos to you. What I am saying is that with clever money budgeting and a strict set of personal guidelines, which I'll talk about in a moment, life needn't be like that.

Climbing the corporate ladder never impressed me, even though I was a part of the corporate world for some years. Driving prestigious cars and owning the biggest house to flatter yourself that you're making others jealous and to make you feel good about yourself always had a hollow ring to it. On the other hand, having a retirement plan and knowing you are set up for your old age is very appealing to me. Knowing I've left my children a legacy - in every sense - is also very important to me. I want my children to have a good life and to be well provided for once I'm gone so I'm willing to make any sacrifice it takes in the here and now. It's okay if you want to work 80+ hours a week your entire life, saving money for your retirement along the way but to me, it makes more sense to think NOW about how you will remain active and financially viable throughout your old age.

It probably sounds too obvious but the first thing you need to do is build your nest egg. You need a buffer of at least SIX MONTHS (preferably twelve) of your wages which is going to be used for investment purposes only and will NEVER be touched - not even for a rainy day (unless you become unemployed of course). It's not until you have your nest egg that you will secure peace of mind for yourself and can relax a little and enjoy your life. To reach this place and remain there afterward you MUST BUDGET, BUDGET, BUDGET!

Read this article for some more money saving tips

How do I build a nest egg, I hear you ask? In exactly the same way a weight conscious person doesn't often eat indiscriminately. You do whatever it takes to get that money put away and you DON'T touch it! I repeat, this money is for investment purposes only and will increase as you age as long as you aren't tempted to touch it. 

Do your day job and then go deliver pizzas in the evening; stop eating out; cut back on all expenditure including your food intake; it's been said a million times before, start to take your lunch to work instead of buying it; no more coffees in polystyrene cups; don't buy takeaway food when the same amount of money will put four servings of a crock pot casserole in your deep freezer; no new clothes, shoes, handbags; buy from op shops; shift to a cheaper brand of cosmetics and skincare; cut your hair yourself; make gifts instead of buying fancy expensive ones and offer your services as a gift; rent a cheap place instead of a place that will blow your budget; pay cash for a car that may be scratched and dented but still goes well and means you don't have lease/loan repayments every week; give up your addictions - it's really obvious and, speaking from experience as a chain smoker who quit in '97, difficult to put into action but incredibly worth it on every level - alcohol, cigarettes, porn/prostitutes, junk food, gambling, magazines etc etc etc.

Read even more money saving tips

Money is just another energy exchange system and the law of abundance says that your needs will always be catered for but those laws are easily broken if you don't meet the universe halfway and take responsibility for yourself and your finances. You have to earn that abundance and if you constantly feel as though you are being tested in this way it's because YOU ARE! Do NOT step outside the simple rules of abundance or you will feel the backlash.

I have experienced this backlash effect countless times in my own life. Just last week I was craving Thai food and was feeling too lazy to cook so my daughter and I went a bit crazy and ordered $40.00 of take away food. I reluctantly handed over my $50.00 bill because I just knew there were going to be consequences for my actions. Sure enough, the following week I received a bill for that exact amount that I hadn't budgeted for and was again trying to come up with a way to get that cash from somewhere. The universe does NOT like us to be frivolous. The other side of that coin is that when you help and are in service, you will be rewarded. For example, last week I did a free astrology reading for my son's friend. Being a student I didn't like to charge him. Within a couple of days I was offered a new free car and fridge and also received a $25.00 tip. I felt so looked after, it was lovely.

Learn how to make household products yourself and save money

Staying with the chicken references, DON'T PUT ALL OF YOUR EGGS IN ONE BASKET. I'm not just referring to what to do with your money once you have your nest egg either. Of course, you may want to invest in property, have a super fund and a high compound interest earning term deposit account. Make sure you have different and varied income streams.

Especially during times of Global Financial Crisis. Monetise your hobbies; don't waste time watching TV, use that time to make and craft things with your own hands that can be sold; get a market stall; sell on Etsy; get all of the things together you don't need anymore and sell them on Ebay; have a garage sale; work two jobs; improve your house and sell it; rent out a room; hire yourself out as a handyman on weekends; take in ironing; become self-employed - that's where the tax write-offs are. Really the possibilities are endless.

And remember once you have your nest egg, that money is on LOCKDOWN. So even when your best mate asks you to "support" him by giving $50,000 to start up his new business venture; when your partner decides to quit their job and take up playing computer games to pass the time or asks for your hard earned life savings for their new "syndicate" which could be risky; your child decides to get married and fly in guests from all over the world for a wedding at a fancy reception centre and you're asked to foot the bill - NO!! The answer is always a RESOUNDING NO!!!! Get rid of the friend, divorce the loser partner but DO NOT cash in your chips! Do not give away or loan your life savings under any circumstances. Better to keep mum about your financial goals so people don't judge you as someone who is wealthy which is the other reason smart, sensible & financially secure people usually look fairly ordinary. Are they sporting the latest brand name clothes? Probably not. They are actually living very comfortable lives and don't give into the peer pressure of needing all of the bling & ostentation.

And if one day your child needs a life-saving operation that will cost you $50,000 then that's a different story but after all, isn't that why we have our nest egg? That sense of security that you have knowing you have financial backup for any worse case scenario is exactly what financial liberation and freedom is actually all about.

If I can leave you with any last words of advice in regards to money it would be these four words: live within your means.

Blessings to you and yours,

This article was originally written in July 2016 and revised March 2018

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