… Remember the first time you came out to the house?
You said you wanted a spot like mine
But remember, anybody can get it
The hard part is keepin’ it, motherfucker
I remember vividly – and it still happens to me – when I received my monthly salary and within a couple of days later when I check my bank account balance I find that it was almost empty. And I literally can’t account for where the money went; I just know that I bought a few stuff for myself. I’m usually left with no choice but to hate and cuss myself. I would self-talk myself: haven’t you read The Richest Man in Babylon, bastard? Haven’t I seen you watching countless financial literacy videos on YouTube or listening to financial literacy podcast episodes? Do you read for leisure? You are a useless human being.
9 out of 10 chances are that you have had such toxic self-talk about your financial habits. I have come to realize that it’s a common experience among young people. Schools never did a good job of teaching us financial literacy. So as young people, we often have to learn by experience.
In addition, finance is a tricky subject – it requires one to be disciplined and honest with him or herself. I mean, you know about the Gambler’s fallacy, right? Or people who have won mega lottery jackpots and a couple of years down the line they’re announced to be broke and have taken away their lives. This is a nod to Dr. Dre’s piece of advice to young Kendrick Lamar who wanted a “spot” like his in the rap game (that is, longevity in the rap industry and a lot of money). Dr. Dre says “… anybody can get… the hard part is keepin’ it…”
Dr. Dre’s comments apply across many disciplines – rap, finance, relationships, et cetera. Entering a relationship or marriage is relatively easy. The real job is in maintaining the relationship or marriage. I can attest to the relationship part – I have experiences from my past failed relationships (a story for another day).
In his book The Psychology of Money, Morgan Housel wrote that “there are a million ways to get wealthy, and plenty of books on how to do so. But there’s only one way to stay wealthy: some combination of frugality and paranoia.”
To be frugal means to be careful about spending money, food, or other supplies. In other words, spending only on what’s necessary. The opposite of the word is extravagance.
Paranoia, in this context, means the fear that the financial returns that someone has made can be taken away just as fast; constantly being aware that yesterday’s successes will not translate into tomorrow’s good fortune; intentionally refusing to be complacent.
To effectively integrate these two aspects – frugality and paranoia – into your life for the betterment of your financial stability, put into consideration these three elements:
- Aim for financial unbreakability. That is to say, invest wisely by diversifying your investments and being consistent for long with your investments so as to allow compounding to work its wonders.
- Plan wisely. That includes having a monthly budget and sticking to it. Even more importantly, planning that things might not go as you wished in your plan. In other words, putting up plans to cushion you against uncertainties.
- Adapt an optimistic mindset. This involves being positive about the future while at the same time being paranoid about what might prevent you from the amazing future you are envisioning, and acting accordingly.
Post A Comment