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5 Keys to Financial Success

Financial Success - It's All Up to You

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Financial success is within reach for anyone. It may not always be easy to attain, but it is certainly possible. The key is to keep learning, and never, ever give up. Here are five steps to help you increase your level of financial success.

1. If you want to invest in something with potential… invest in yourself. Your ability to earn income is a powerful asset. Make the most of it. Before you go buy gold coins, or that timeshare, look at ways you can invest in yourself. Where do your interests lie? Find certifications and training classes that match your passions and skills. It will send your career in new directions and provide you with opportunities to earn more. You can’t say the same thing about that pile of gold coins tucked away in the safe.

2. No one has the investment answer… but every sales person out there is going to present what they do have as if it were so. Think about it. If the investment professional you are meeting with could consistently read the markets why would they be sitting there talking to you? They wouldn’t. Successful investing is about discipline, process and planning. A good professional follows a disciplined and time-tested process. The crazy stories you hear about people doubling their money in a matter of weeks? That’s called luck. A little luck never hurt anybody, but if you're counting on luck to bring you financial success, you're need to reshape your thinking.

3. Planning pays off…. especially tax planning. A few hours of planning a year can add up to the equivalent of increasing your investment return by 2-3%. Tax planning, particularly when coordinated with retirement planning, can make your money last 5 to 7 years longer, or be the equivalent of having 20-30% more money than you start with. This is big bucks. You want an investment that really pays off? Invest in a few hours a year to do your tax planning, or find a professional who can help.

4. The single biggest factor to your financial success is… your ability to spend less than you make. Sounds easy, yet few can master this task. As one friend said, “A budget? I’ve had a budget forever, I just forget about when I go out.” You must find a way to monitor money in verses money out. Some use software or online services, others a simple excel spreadsheet. Some track things on a yellow pad, others review bank statements each month. Some use envelope budgeting, or a weekly allowance system even for adult family members. Now banks are catching on to this need and making it easier to track things online, set spending limits, or turn on “alerts” attached to your account.

5. It ain’t going to fix itself… you’re going to have to do it. My favorite definition of insanity? Keep on doing the same thing over and over and expect different results. If you don’t save enough now, you’ve got a problem, and you are the only one who can remedy the situation. Sit down and write out a list of action steps you can take over the next 6 months to take things in the direction you want to go. Start implementing them over a time frame that is manageable. Review your progress every month. The alternative? Money doesn’t grow on trees, so if you aren’t willing to take action, you must be insane.

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