When your phone stops being a hot line and you no more sign the voucher! When the time book is gone and the benefits no more! When the imprest stops coming and the contracts too slow! When you call to the office three months after your retirement and your retirement benefits are not yet ready, there is nothing that will contribute so much to your peace of mind and self-esteem as the self-confidence that you have some good money in the bank, that the cash flow from your investments can take care of you even without the benefits. How does that make you feel?
Think about the ability to take advantage of unusual business opportunities when they present themselves. When somebody is desperate for supplies and wants it within short notice and sometimes is ready to pay higher for it, that is not the time to begin to look for bank loan or L. P. 0 financiers. You need the ability to walk down to the bank and finance the deal.
Think about the ability to take advantage of bargain deals on assets because you can pay cash. When somebody is offering his house worth N10 million for sale at N6 million, who do you, think will have the deal? The person who offers N5.9 million and then wants to use six months to raise the money or the one who offers N4.9 million with the cash at hand?
Dear friends, nothing on earth can take the place of savings in the journey to financial freedom. It is the one habit that will help you avoid financial embarrassment. Once you get this habit you will no longer have to worry about how you will pay your rent or feed your family or pay the school fees of your children. When office politics comes up in your workplace, you will remain calm knowing that you would not die if you lose your job.
As I said financial independence has nothing much to do with how much you make. But it has everything to do with how much you do not spend. It really takes a few months of discipline to increase your income but you need a lifetime of discipline to become financially independent. You can take six months to master a skill that will bring you double your present income for the rest of your life but to become financially independent even with that higher income, you need a lifetime day-to-day discipline at controlling how that higher income is spent. You can build a decent house within two years and the house thereafter gives you a lifetime cash flow of rent but you will need a lifetime of day by day discipline on a consistent basis if that income is to set you up for life.
When next we meet I would be willing to hear not just how much you’ve made but also how much you have not spent. Research has shown that money stays in the hands of the Asians 9 times as long as it stays in the hands of Africans. That means they take longer to plan and do some investigations before they spend. No wonder the fact that between 1960 and 2010, the economies of Japan, Hong Kong, the Republic of Korea, Singapore, Taiwan, China, Thailand, Indonesia, and Malaysia have grown roughly 3 times as fast as Latin America has and 25 times faster than that of Sub-Saharan Africa. In future episodes, we shall look at the economy of the United States at the time they were as poor as Africa and what they did to fuel their growth. We shall look at how Japan made it at one third the time it took America to do it and what the Asian tigers are doing right that Africans are not yet doing.
All the money that passes through our hands have the potential to make us set for life but they can also pass out and make us strugglers for life depending on what we do with them. We would need to control expenditure so that cash might be freed up for generating more money. We need to plug the holes in our pocket so that money may remain to finance projects that would bring in more money.
AS IMPORTANT AS CONTROLLING EXPENDITURE SOUNDS, WHY ARE THE MAJORITY OF PEOPLE IN OUR SOCIETY NOT DOING IT? WHY DO AFRICANS FIND IT DIFFICULT TO SAVE WHILE THE AVERAGE CITIZEN OF SINGAPORE SAVES MORE THAN 46% OF THEIR INCOME? WHAT DO SINGAPOREANS THINK? WHAT ARE THEIR PLANS? WHAT MAKES THEM THAT DISCIPLINED?
KEEP READING AND LISTENING TO SPEND LESS, EARN MORE. THE COMMITMENT TO FIND ANSWERS!
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