Do I spend more than I earn? If you are dipping into your savings to pay for your rent every month or using your credit card to pay for shopping sprees every month, you are spending more than you earn. This can only lead to greater debt and less savings. So, be honest about your spending every month and make sure you only spend as much as you earn. This means factoring in money every month for expenses and savings.
The most important single requirement is self-discipline combined with the ability to delay gratification. Your ability to practice self-mastery, self-control, and self-denial throughout your life will not only enable you to achieve all your financial goals, but it will also make you successful and happy in everything else you do.
It is quite common for many people, when they are unhappy or frustrated for any reason, to go shopping. They unconciously associate buying something with being happy. When it doesn’t work as they expected, they buy something else. Sometimes unhappy people go on shopping sprees. They buy lots of things they don’t need because they unconsciously associate spending with happiness.
You need to reach into your subconscious mind and disconnect the wire linking “spending” and “happiness” You need to then reconnect that “happiness” wire to the “saving and investing” wire. Instead of saying I feel happy when I spend money, you will say “I feel happy when I save money”.
Today financial advisers suggest that you need to save 15 or 20 percent of your income in order to achieve all your financial goals. Any less than this opens you up to the risk of running out of money later in life. Everyone who has ever practiced this principal of regular saving is absolutely astonished at how quickly their financial fortunes change for the better.
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If from the age of twenty four until you are sixty-four you were able to save 30,000 naira per month and invest that amount in a mutual fund or index fund that increased an average of 7 to 10 percent per year, you would be worth more than a million dollars. You are sure of becoming one of the wealthiest people in the World.