If you can’t already tell, I’m a big fan of personal development.
I do daily updates on all my social media platforms, weekly YouTube videos, weekly articles on my blog and use all these tips myself to help me live the good life.
Without action, however, the content is a wasted effort. If you’re not careful, you can quickly find yourself wasting time by just being entertained.
So having action and playing it smart is key.
One of the aspects I want to zero in on, pertaining to the good life today is: wealth.
When it comes to wealth many people have a misunderstanding on how to accumulate it. Materialistic things can also trick us into knowing who understands money and who doesn’t.
Bottom line is if your money in your bank account are going up, that is obviously a good sign. If it’s going down, you should take notice. Of course, there are exceptions when it comes to investing and you have to take a look at the whole picture in the long run. But the focus should be on incremental gains.
In this article I’m going to discuss some of the misunderstandings people have when it comes to money and what they can do about it through a sports analogy.
The wealthy are quick and easy to spot, right?
Although you may be distracted by the fancy car, flashy clothes, or even the upscale neighborhood, it’s not giving you the whole picture.
Majority of the time, these are not the wealthy.
Before you curse me out and call me a liar, there are exceptions to the rule.
However, the fancy car, the expensive suit, and increased means of living are all liabilities. In other words, they cost you money. A lot of money!
The wealthy understand this so they invest. It’s not on a new car, watch or mansion, but they invest in assets.
They invest in things that make them money.
It’s important to keep this mind when making your next purchase. Are you buying liabilities or assets?
There are a few ways to increase your bank account. For starters, you can be lucky and win the lottery or be born into money. Even though a little luck may be involved, let’s put these aside and focus on what we can control.
Now this may sound simple and can annoy people, but you have to go back to the basics.
Live below your means.
In sports, particularly basketball, you are either playing offense or defense. Most players are recognized by the shots that they make—their offense. But if you really break down the game, you need defense.
Living below your means and being frugal is like playing defense when it comes to money.
Not many people play defense though.
Why? It take effort and it’s not flashy.
Think about it, sometimes you have to pass up on buying on impulse and focus on your priorities.
In fact, when you live below your means, many people are quick to assume you’re not as financially secure as you might be in reality.
It’s not the sexy move.
However, it will get you closer to your financial goals.
You have to work on your discipline against the barrage of advertisements thrown at you and not succumb to the social pressures there are with your friends, family and social environment. When it comes to wealth, many people expect you to live a certain way.
Now here is the fun part: the offense.
It’s one of the first things people associate to the wealthy…how much do they make? What is their salary? What’s their income?
The amount of money you make is in proportion to the difficulty of the problem you solve. In other words, your skills. Are your skills challenging and in demand?
It’s important to keep in mind that, playing offense (gaining skills) does take effort and work too. It also has the social status playing in favor of it. Many people respect and admire those with high salaries.
But the point I’m trying to make is that one is not better than the other. It’s that you have options on how to achieve your financial goals.
Think about it, what good is it if you make a lot of money, but your expenses and means of living increase as well. Sometimes even to a point of where you get into bad debt. That’s not wealth. That’s not living the good life.
Yes, you may have nice things but you’re also going to be in this constant fight to continuously work to pay bills, keep up with a social status, and stress out.
Wealth is a valuable part of living the good life. Whether you’re strong at the offensive or defensive financial end, you have to recognize your strengths and weaknesses.
Doing so, you’ll be able to build on your strengths and work on your weaknesses when it comes to accumulating wealth.
Remember, being good on one side is solid, but being well rounded is a whole other level.
Are you leaning more towards the offensive or defensive financial end?