Lauren Cobello » Budgeting » Budget Tips and Tricks » What is Financial Success Really?
Financial success. It’s something that even many wealthy people think they haven’t achieved.
Could you be one of them?
If you make just $27,000 per year, did you know you’re in the top 1.63% richest people in the world by income? In one hour, you make $14.06 while the average laborer in Indonesia makes just $0.39 per hour. It would also take the average laborer in Ghana 168 years to earn the same amount you do in one year.
Feeling a little bit more financially successful? If you’d like to find out exactly how rich you are, check out GlobalRichList.com.
While you may be feeling pretty rich right now compared to the global population, some facts about your financial situation might be creeping back into your mind. Perhaps you have:
These are just a few of the financial struggles of ordinary Americans.
So, are you rich? Are you poor? What is financial success, really?
The problem with trying to achieve financial success is that it looks different for each and every person.
Here’s a working definition I like: Financial success is obtaining and maintaining the financial means to live the life you want to live.
If you want to go out and fish for your food every day, then putting gas in your boat and lowering your financial obligations to do so is your financial success. If you want to own a mansion and sit on the portico drinking sweet tea every morning, investing or building a business that allows you to afford such a lifestyle is your financial success.
Financial success is subjective. It’s not an objective goal.
One thing is certain, though: it’s always a good idea to move toward YOUR idea of financial success. Don’t worry how much money your friends make
How do you move toward your idea of financial success? By accomplishing some financial goals! Here are some of our favorite financial goals that can lend themselves to help you achieve financial success.
Mark and I paid off a whole lot of debt when we got serious about our finances. The good news is you can too.
Debt is a heavy burden that will go away 100% of the time that you make payments on your loans. But that doesn’t mean your debt will go away quickly. In order to do that, you’re going to have to attack your debt.
There’s no better way to get a guaranteed return on your money than to invest in paying off debt. Think about it. How much money are you wasting every month and every year on interest payments? You probably don’t want to find out how much you’re wasting – if you have debt payments it’s probably a lot!
Pay off debt. It’s a great financial goal.
An emergency fund will help you pay for all those unexpected expenses that come up in life. The broken ankle, the overheated radiator, the flight to visit a loved one who is about to pass away – you get the idea.
Many experts recommend saving at least three months of expenses in an emergency fund. Saving more than that is probably a good call (perhaps shoot for six months of expenses).
I hate complicated budgets. That’s why we use Tiller. It automatically populates your transactions into a google sheet, then you can categorize them and create a budget with this sheet. We have a custom template that we’ve designed with them that you can check out here.
Give it a shot. Start your first budget. I think you’ll find that budgeting doesn’t have to be complicated – it can be a lot of fun once you get started.
I am great at spotting deals wherever I go: yard sales, grocery stores, you name it. I love finding coupons and getting people to slash prices on things that I am already paying for. Like find alternatives to cable and cheaper cell phone services.
Now, there are some instances when you shouldn’t use coupons, but there are many good deals you can spot if you pay attention.
Having a frugal mindset is a good way to use more of your income for other financial goals like paying off debt and investing for retirement.
In your latter years, you may not be able to rely on your ability to hold a job due to disability or other pressing circumstances. That’s why investing for retirement is so important.
The best time to start investing is as soon as possible. Time plays an important role in the wonder of compound interest. Invest early and enjoy the fruits of your labor for years to come.
I want to hear from you. What does financial success look like to you? At what point will you be able to say, “I’m financially successful?”
Leave a comment below. I look forward to hearing from you!