There are a lot of things to know about money. The problem is we always start with the terminology, graphs, and boring complexities. The truth is that money starts with your emotions. The emotions that you feel when you earn money, spend money, and save money. People rarely have the ability to understand where this emotion starts.
Emotions around money are complex. Instead of writing about all those complexities, how about we just talk about the best way to clear these emotions from your mind. Here is the first and only thing you need to do.
The first thing you need to learn about money, money is only useful when saved. It can be useful when spent but there needs to be a strategy when you spend it. The usefulness of money when it is saved is built in. It’s automatic.
You can’t understand the power of a savings account until you experience it in your own life. Having a savings account does three things really well:
- It frees up your mind to think about other things. When you’re stressed about money you can’t make good decisions. Lack of good decisions puts you in a deeper hole. This cycle will continue all the way to what I call #Brokeness
- It allows you to take the risk. Risk, believe it or not, is the only way to get ahead. The people who treat risk as their Trojan horse will never go far, with money or in life.
People want to make saving money complicated. It’s not complicated. I’ll tell you the only rule you ever need to know:
When you get your check, take 20% of it and put it into a savings account. Don’t look at the savings account, don’t take from the savings account, don’t even think about it. Ignore it!
Live as if you made 20% less money.
All the tips and tricks in the world will convince you to do useless “savings tactics”. It won’t work, this will! That’s it, that’s the secret. If you do that for a year, you’ll start to truly understand the power of saving and keeping money.