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The Trap That Keeps You from being Financially Free

Written on September 15, 2009 by admin in Financial Freedom

money_trap You’re probably familiar with the old saying, “Be careful what you wish for because you might just get it.”

Bigg success is life on your own terms. The terms we use to define our bigg success are incredibly important.

When we get what we wished for, it better be what we really wanted!

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For example, we may seek financial security. How do you define financial security? Is that what you really want? Or is there a better term for what you seek? Are your actions consistent with your definition?

These are a few of the questions you might ask about a term which is a goal.

Financial security

Financial security means safety. You have a refuge from any storm. This is the reason a lot of people like having a regular job. They feel like it gives them some sense of security.

We often confuse financial security with financial stability. One of the reasons we like that job is it provides a steady income. That’s not security; it’s stability.

This highlights the importance of understanding what a term really means to you.

Does a job or a career offer you financial security? We think it doesn’t.

You have to create financial security for yourself. But that’s just the first level. You may really want more than just safety.

Financial independence

You may seek financial independence. You want to be self-reliant. You don’t want to depend on anyone or anything to meet your financial needs.

You’re able to live a comfortable life. You may have a job but you also have investments or other sources of income in case something happens with your career.

Financial freedom

The next step up is financial freedom. You’re free to live the life you really want to live. Your income exceeds your lifestyle costs by a significant margin.

The trap that keeps people from financial freedom

Randy Jones, author of a book we highly recommend to you, The Richest Man in Town, wrote about the trap that keeps many people from reaching financial freedom on his blog a while back. He said:

“A stable salary can be addictive: like a drug, it feels good, helps you cope with the ups and downs of life, and it is very hard to give up. But dependence on a salary is a major impediment to becoming the richest person in town. The regular fix of a paycheck from the other guy makes you risk-averse, and the ability to take risks is one of the qualities that defines an RMIT.”

So if you want to be free from money worries, you have to take risks. Risk is the opposite of security. But you have to take those risks to reach the level of financial freedom.

And by our definitions, a person who reaches the level of financial freedom is also financially secure … and then some.

No job can make you financially secure. No business can do it. No investment can do it. You have to do it by putting all the pieces together.

It starts by defining bigg success and then going for it!

You’ve heard our terms for money. What are your terms?

Share that by leaving a comment below, e-mailing us at bigginfo@biggsuccess.com or calling us at 888.455.BIGG (2444).

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Thanks so much for the gift of your time today. Please join us next time when we talk about an old-fashioned tool that increases your productivity. Until then, here’s to your bigg success!

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6 Paths to Financial Freedom

(Image in today's post by nusrin)

3 Comments

Money Tips if You Do Not Have a Steady Income

Written on March 30, 2009 by George Krueger & Mary-Lynn Foster in Money

Bigg success is life on your own terms. We talked all about that last week in a series of five posts where we painted the bigg picture.

Now we want to get into the nitty-gritty. What keeps us from living our lives on our own terms?

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Hear George & Mary-Lynn discuss today's money challenge on The Bigg Success Show! Click the purple player: Play Now | Play in Popup | Download

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The challenge of irregular inflows

One of those things is not having enough money – one of the five elements of bigg success – when we need it. It’s one thing if you have a regular salary. However, a lot of people don’t have a steady income. It fluctuates from month-to-month.

What if you’re a salesperson working on straight commission?

What if you own your own business and don’t draw a regular paycheck? You may be a freelancer or a solo entrepreneur. You may be in business and have employees. You not only feel responsible for putting food on your table, you also have a group of people to whom you feel responsible.

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george I certainly can relate to this subject, having been a business owner for pretty much all of my adult life. Come to think of it, before I went into business for myself, I worked on commission as a sales person so I’ve seen both sides of it.

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marylynn
Of course, with George, I now am a business owner too.

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george
Welcome to the club, Mary-Lynn!

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marylynn We have a couple of businesses in their early stages. I left a job in the corporate world with a regular paycheck, but I sure understand now what it’s like not to have that. I know I’m not alone. A number of people in our community have mentioned this as a major challenge to living their lives on their own terms.

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So what can you do if your income fluctuates from month-to-month?

Understand your cycles

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george One thing that I found is that I had to understand my cycles. I’ve struggled with this one. When I wasn’t busy, I’d spend time and money promoting and prospecting. Then I would get too busy – I don’t have time to promote and prospect. So I stopped doing it. The thing I knew, I wasn’t busy again and the cycle would start over!

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If you can be consistent with your most important activities – those things that generate the most income for you – you may be able to smooth out your inflows.

You might even find that you can hire an assistant to perform some of these activities for you. You spend a little money now to save you time and make you money a little later.

What if you can’t afford to hire someone to help you? Then you’ll have to invest the time yourself. When you find yourself in your next “up” cycle – you’re too busy to spend time on crucial prospecting and promotional activities – take a look at it again to see if it makes sense.

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marylynn Another thing I’ve found is that I can be more consistent if I carve up my activities into smaller chunks. For example, I may send out five e-mails every day of the week instead of thinking that I need to send out 25 e-mails. If you don’t have the time to do that, start with three e-mails a day.

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Stabilize your outflows

Risk is often measured by volatility. So by definition, if we have irregular inflows, we are taking more risk. Because of that, we should strive for less risk in our outflows.

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marylynn We do this by keeping our standard of living relatively low. Our businesses are in their early stages. So we watch what we spend and live very frugally. For example, we watch how much we shop and go out to eat less than we did when our incomes were more regular.

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One of our newsletter subscribers, Randy, says “rowing his own boat” by working for himself are his terms for his life. He’s been on his own for about 25 years now. He’s put his two sons through college while remaining debt free. He says he did it by having a plan when his boys were just babies. That plan paid off. He just turned 50 and plans on living the way he wants from here on out.

Congratulations Randy and thanks for sharing your story with us!

Randy’s story also helps us understand a second part of stabilizing our inflows:

Be very, very careful with debt.

We have to resist the urge to pile onto our outflows by adding principal and interest payments. It puts even more pressure on our inflows and more stress on us because we have to earn even more.