Monday, January 6, 2014

Do you control your money?

Many people working under employment always complaint about hectic life, office politic and salary “not enough”. That's why they try to build another source of income or multiple source of income. While having another source of income is important, don't forget we need to control what's coming in and manage it, else, you may fall into this situation: “I have 6 figure salary, but still in Financial trouble”. 
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The biggest different between financial success and financial failure is how well one manage the money. People become poor or remain poor because they don't like to manage their money. The common reason given is they don't have money to manage. So, they say, “when I have plenty of money, I will manage it”. This is similar to an overweight person saying “I will start exercise and balance my diet when I lose 20 kg”. The money, you must start to handle it properly and you will have more money to handle.
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How to manage your money? As per one of the program which I follow, first, create a habit by open a “Financial Freedom Account”. Put 10% of your monthly income into this account. The account is use to build “golden goose” that lays golden eggs, we call it “passive income”. Never spend the money in this account, it's for the purpose of building retirement income.
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Then you create another account, call it “Play Account” and put another 10% from your income to this account. This account is to reward your hard work every month, you may spend all money in this account. It could be stay in hotel for one or two day, or buy a handbag or eat a good meal in expensive restaurant or buy a gift to yourself or someone you love! The idea is to have a balance to offset the first “Financial Freedom Account”.
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For the remaining of 80%, you may assign according to your financial need such as X% to Education Account, Y% to Necessities Account, Z% into your Long Term Saving/ Spending Account. Don't think this is another “boring” program, many high income professionals (similar to the above story) are basically broke because they don't know how to do with with their income. They just know they earn a lot, then it's fine to spend and spend without the plan. I believe if you manage your money following this program, you may become financially free on a relatively small income. Remember, to control the money, you must manage it!

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3 comments:

  1. And that programme is called millionaire intensive mindset seminar :)

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    Replies
    1. Hi, CT Yap,
      Not bad... you must be one of the student!

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    2. Hi Vincent, ya. It was a nice course. Everything starts from our mind.

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