20-video series #6: Spend purposefully: eliminate bad debt and liabilities to secure your independence
Dec 19, 2022
Welcome to my new 20-video series, on the 20 Next Level Wealth steps to designing and then living your dream life.
The dramatic landscape changes over the past few years have created a unique opportunity for you to design and live your dream lifestyle.
In this 20-video series, which I filmed while travelling around Europe, I've aimed to articulate everything important that I've learned about personal finance, business, wealth, and designing an ideal lifestyle...into just 20 short blog posts!
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Clear the decks
I’ve noted elsewhere that too many professional employees place too low a value on their time.
They spend hundreds of hours per month at work, getting ready for work, travelling to work, and then even thinking about work.
But then, somehow, at the end of the month after paying for taxes and lifestyle costs, there’s very little left over to show for it.
If you divide the number of hours worked by the actual dollars saved at the end of the month, you might be in for a nasty shock!
It should go without saying this is not the path to escaping the 9 to 5 and living your dream life.
Draw a line in the sand
Before we get on to the more interesting parts of the video series, make a commitment to spending purposefully, eliminating bad debts, and getting some focus.
If you’re going to commit to achieving your goals, you’ll need to clear the decks.
What do I mean by that?
Well, it’s going to take time and commitment, so if you’re overloaded with other commitments that’s going to make it harder.
If you’re going to design and live the life you want, you need to make it a top priority.
Spending purposefully
I’m not one those ‘frugalista’ types and never really have been.
I can do it for a while, sure, but I like spending money as much as the next person… and in the end life is for living.
I like to spend money on travel, days out with my kids, and living a good quality of life in Noosa.
But it is important that you get your financial framework in order.
Too many people blindly follow what everyone else is doing, and then are confounded when they get underwhelming results.
Numerous studies have shown that the comparison trap leads people to attempt to “keep up with the Joneses”, without thinking too hard about why they are doing it.
In fact research by the Federal Reserve Bank of Philadelphia found that you’re more likely to go bankrupt if you live next door to a lottery winner (because people tend to ramp up their spending to keep up with their neighbours).
An important starting point, then, is eliminating bad debts such as car loans, credit card, debt, and other consumer liabilities.
These monthly commitments will only hold you back from your quest for freedom.
Prepare for lift-off
Rather than being tight and watching every cent, it’s more important to get a few big-ticket items right, and then to focus on spending purposefully.
One you’ve got this plank of the plan in place, then we can begin to focus on the next step, which is prioritising how you spend your time, choosing your mentors wisely, and using compound growth to multiply your wealth over time.
I discussed this a little further in the short video below.
Watch it here.
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Whenever you’re ready…here are 4 ways I can help you manage your own money and go next level wealth:
- Boom or Bust in 2023 – 20 minute online workshop for investors
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