We still haven’t changed our opinion about the importance of Financial Education … but who said SAVING MONEY is something ENJOYABLE? The best thing is spending money, preferably without feeling guilty and without having to think about balancing the books at the end of the month. Unfortunately, we can’t just think about spending, but at least I think it’s important for us to be aware that the habit of saving isn’t very natural for most of us.
Perhaps this awareness is the first step toward understanding that maintaining a balanced financial life will indeed require a certain amount of effort. But hold on, it’s not as difficult as it seems!
If you’re one of those people who has a huge mental block when it comes to creating a Household Budget, perhaps the best strategy is to start by taking small steps. And to get started, you need to understand 2 golden rules of Financial Education.
Just two rules: keep them in mind, sleep with them, wake up with them … until they truly become part of your day-to-day life.
1st Rule: To save money, you need to EARN MORE THAN YOU SPEND.
This rule seems very obvious, right? But the problem is that you may know the rule and even understand it very well, but you really don’t care about it at all.
At every moment of your life, you should think about this rule. When you’re buying something, anything at all, be aware that part of what you’ve earned is going away. It’s as if you had a tank full of money and were opening the faucet and letting the money escape down the drain.
If spending this money is really worthwhile, go ahead. Otherwise, turn off the faucet. Your money tank will thank you.
2nd Rule: Money Makes Money.
Some people think saving is good because the amount saved goes straight into their savings account. Wrong.
Saving is good because the more money you have, the more money will be generated through investments! Compound interest.
You should know that you’ll never become rich simply by saving money. As we said, besides being something “not very enjoyable,” savings by themselves don’t multiply.
To be truly financially well-off, you need to invest wisely. And to do that, of course, you need to have money saved. But your main motivation should be to have enough money to invest. And every amount of money you save should have this goal.
In summary: Keep the 1st and 2nd Rules in mind throughout your life.
It’s very important for you to expand your knowledge of Financial Education. But never set Rules 1 and 2 aside. The vast majority of other strategies for building wealth and achieving financial balance are variations of these.
