I have always wanted to be a wealthy person - not rich but wealthy. The difference is simple: a rich person has enough resources to guarantee him a good life but a wealthy person has enough resources to guarantee prosperity to his posterity. So one day, I posted this question in a Forum
“How can I make my first million before my 30 birthday?”
As you may have guessed, it resulted in a long thread of solutions from every Tom, Dick and Harry. There was plenty of good advice and plenty of bad advice too. Some people advised me to forget the unrealistic goal, some advised me to try business or innovation and others advised me to rob a bank. Another one had the audacity to tell me to become a prostitute that charges a dollar and look for a million clients.
That made me realize I was doing my research in the wrong place. I decided to take the question to real life rich people. I based my decision on the hypothesis that you can argue with ideologies but you can never argue with results and facts. The first rich person I posed the question to gave me a simple answer. Save. That’s when I began saving 30- 40% of my income. It was not easy at first. In fact, it took me almost a year to make it. When faced with the choice between paying now and playing later or playing now and paying later, playing now is always extremely tempting. But I had a strong resolve to get wealthy so I fought the temptation albeit slowly and began growing my savings.
Saving money is the very first step towards attaining financial freedom. But you will have to fight some of the myths that might be stopping you from starting. Let us look at some of the common excuses for not saving money.
Excuses for not saving money
1. You need a better income to begin saving
It’s a law of economics- resources are always limited and needs are always unlimited. As soon as you upgrade your salary, your needs will increase. Do not wait to get a better job in order to begin saving money. Start right now with your current salary- however meager it is.
2. You need to save a huge chunk monthly
Most people look at their current expenditure and upon realizing that the money they can save is just too little, they end up not saving anything at all. Saving is a discipline and if you can’t learn the discipline when you have little money, it will not automatically kick in when you get a better income. Just save something that you can afford however little it is- of course it would be better to knock off some of your monthly expenditures that are not that important and save more.
3. You need to clear your debts first before you begin saving
Most people are so much in debt that the prospect of clearing those debts any time soon is like locating the proverbial needle in the haystack. It is a good idea to pay off your debts as soon as possible but do not let that be an excuse for not saving. Like we have already established, it’s not just about building your credit but it is also important to create the discipline of saving.
So what next after saving? Well, that will depend with how long you have saved and how much you have saved. The goal of saving is not for use on a rainy day- unless you are not saving with the intention of getting wealthy. The goal of saving is to invest the money either by buying assets or by starting a business. Whichever way you decide to go, it is always better to do it without a loan from the bank. But that is a story for another day.