How to become a Saver from being a Spender

Once upon a time I was a Spender. I have yet to receive my salary but it is already consumed because of things that I wanted to buy. The sad thing about is, I bought items with the use of credit. I was not only a spender, I was also a debt magnet.

It crossed my mind that my financial life is going nowhere. I have no investments. I have no savings. Until one day, I decided to change my mindset. Instead of being a spender, I now wanted really bad to be a Saver. I was able to buy books on proper financial management and lifestyle simplification. I needed mentors, and it came in the form of books, audio books, internet articles, etc.

I was never the same after that. I’ve learned about the prosperity formula. I’ve never known, that for us to be able to prosper, we must follow the prosperity formula, which was the formula used by rich people.  And that it:

Income – Savings = Expenses

We must live on what was left after we deduct our savings from on our income. Before I used the poverty formula:

Income – Expenses = Savings

The problem about this formula is, most of the time, there was no savings at all. And there were times that instead of zero, it becomes negative, forcing us to incur debt.

It is recommended that we save at least 20% of our income and put it into something which would earn us interest.

Now, I am using the prosperity formula to help me boost my financial life so I can be financially free when the time comes that I already need to retire. I am excited when payday is already around the corner since I know that I can once again transfer funds from my payroll account to my savings account. Saving nowadays became more convenient because of online banking. With a few touch, we can easily transfer funds from one account to another.

But we should not just stop with just saving our hard earned money in the bank. We also need to grow our money exponentially. We cannot just rely on the 0.5% annual interest that our money earns from the bank. We need to beat inflation. And that can only with the use of investments. More on this.

Have a nice time. 🙂

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Simplification

I have lots of plans.  I plan of having another house.  I plan of having a new car since I already paid up my first car loan after five (5) painstaking years.  But if I have to ask myself, do I need it?  Will it make me happy?  How can I afford it?  Honestly speaking, if I am pursue those things, it will be in the form of a loan.  Seems not a good idea. It is not necessarily a need.  I might feel satisfied but it won’t make me totally happy.  And getting it through a loan will definitely give me sleepless nights.  Something is holding me back to let go of these plans. What is it?

simplifySometime 2012, I stumbled upon this book written by Bro. Bo Sanchez.  It was published around 2001.  I only got hold of this wonderful book 12 years after it was published.  I regret not being able to get hold of it much earlier.  I could have experienced a turnaround much earlier.  I shouldn’t have done regretful decisions.  I shouldn’t have purchased depreciating items with the use of a loan or credit cards.  I could have invested much earlier on valuable financial instruments.  I could have been much happier now.  I could have been living the good life much earlier.

The turnaround might have come at a later time.  But it is not yet too late.  Long before I conceptualized this blog, I took it upon myself that I will make my life as simple.  Life is already complicated, so why complicate it more by unnecessary things.  I could have opted for a flashier car, but I opted for a simpler one.  A flashier car requires a higher amortization.  More money coming out of my pocket.  As much as possible, I stay away from signature items.  I want simpler ones.  I learned to be happy on simple things which is the way it should be.  I now opted to live in a simple home rather get a new one from an exclusive village which can eat up to my budget which I can use for investment and create wealth. Nothing beats the feeling of staying at home and spending quality time with my family rather than spending it somewhere else.  Though we still go out, we make sure that it won’t be too often.  Besides, we already have what we need at home.  All the basic needs.  All the basic reasons which makes me happy and want to live the good life even more.  And that is LOVE.

Have a nice day friends. 🙂