What have you learned about money so far this year?Â
If you have empowered yourself by gaining new knowledge you will be in a better position. If you did not spend time gaining new knowledge, how did you expect to get wealthier? New information unlocks a different way of thinking that leads to a different set of actions and habits that change our financial lives.
Have you had at least three conversations with people who have created wealth and are ahead of you in this journey?
This question is closely linked to the one above but the conversation element is extremely important. If your conversations have been the same with the same group of people, you will not be empowered. A person who has not walked the journey ahead of you cannot teach you anything. The only person who can tell you why that business idea or investment will work or not work is the person who has experienced it.
Have you spent less than you’ve earned so far? Figuring this out is easy.
Are your savings and investment balances greater than they were last year and by how much? If not, it means you spent all your money. If all you have to show for it is a nicer car, home furnishings, holidays and phones, you have failed this particular test. You cannot create wealth if this equation is out of balance. However, if you have a bigger savings balance, more investments, etc., then you have made progress.
Are you earning more than you were a year ago? Most of us are definitely spending more than we were a year ago.
Rising expenses are not a surprise. We all know inflationary pressure will affect even basic needs. My challenge is this: have you done anything to create additional income for yourself? Did you perform better at work and get an increase or bonus? Did you spend your spare time pursuing something that will generate income? Did you grow your business? Did you get returns on investment? This question is not about whether your employer paid you more. Great if they did, but if not, what did you resolve to do to earn more income?
Do you have less consumer debt than you did a year ago?
Consumer debt is debt on lifestyle expenses such as credit cards, school fees, car loans, personal loans, etc., and debt that has not resulted in additional investment value. If your consumer debt is not less, it means that either the cycle of bad borrowing continued or you did not make additional effort to pay this debt quickly.
Have you reviewed you goals this year? What have you found out
I know many people voiced their financial resolutions and fewer put them down on paper. Even fewer took action and fewer still monitored and reviewed their goals continuously. If you are not looking at it, thinking about it, doing the research and taking continuous action, it is never going to happen.
Do you know how much you are worth right now?
We will never know if we are growing financially if we do not keep track of what we are worth financially. If you did not immediately know the answer to this then you are not keenly watching the value of your assets versus liabilities. Your financial value is the difference between the two. It gets better when your assets grow and/or your liabilities reduce.
