Feeling financially strained in a wealthy nation? It's not just about income; it's how you manage it! In this episode, I explore why many struggle despite decent earnings. From paycheck-to-paycheck living to debt acceptance and chasing excess, I delve into cultural and psychological factors fueling financial woes. Tune in to understand common pitfalls thinning our wallets.
IN TODAY’S EPISODE, I DISCUSS:
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Building Your Money Machine: How to Get Your Money to Work Harder For You Than You Did For It!
The key to building the life you desire and deserve is to build your Money Machine—a powerful system designed to generate income that’s no longer tied to your work or efforts. This step-by-step guide goes beyond the general idea of personal finance and wealth creation and reveals the holistic approach to transforming your relationship with money to allow you to enjoy financial freedom and peace of mind.
TAKE THE FINANCIAL FREEDOM QUIZ:
Take this free quiz to see where you are on the path to financial freedom and what your next steps are to move you to a new financial destiny at http://www.YourFinancialFreedomQuiz.com
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Feeling financially strained in a wealthy nation? It's not just about income; it's how you manage it! In this episode, I explore why many struggle despite decent earnings. From paycheck-to-paycheck living to debt acceptance and chasing excess, I delve into cultural and psychological factors fueling financial woes. Tune in to understand common pitfalls thinning our wallets.
IN TODAY’S EPISODE, I DISCUSS:
RECOMMENDED EPISODES FOR YOU
If you liked this episode, you'll love these ones:
RECOMMENDED VIDEOS FOR YOU
If you liked this video, you'll love these ones:
PRE-ORDER MY NEW BOOK:
Building Your Money Machine: How to Get Your Money to Work Harder For You Than You Did For It!
The key to building the life you desire and deserve is to build your Money Machine—a powerful system designed to generate income that’s no longer tied to your work or efforts. This step-by-step guide goes beyond the general idea of personal finance and wealth creation and reveals the holistic approach to transforming your relationship with money to allow you to enjoy financial freedom and peace of mind.
TAKE THE FINANCIAL FREEDOM QUIZ:
Take this free quiz to see where you are on the path to financial freedom and what your next steps are to move you to a new financial destiny at http://www.YourFinancialFreedomQuiz.com
OTHER RESOURCES:
7-Day Money Plan Workshop: https://www.TheMoneyPlanWorkshop.com
Affluent Entrepreneurs Private Facebook Group https://www.melabraham.com/group/
CONNECT WITH ME:
Website: MelAbraham.com
YouTube: MelAbraham.com/tube
Instagram (@melabraham9): MelAbraham.com/ig
Facebook Group: MelAbraham.com/group/
All right, welcome to this episode of the affluent entrepreneurial. This one's going to be an interesting one. Why does it seem like everyone's broke, especially in rich countries? Well, I think there's some things that contribute to it. Now, some of this is perspective, some of his facts and stats. But I want to make sure that you don't become a statistic. I want to give you some things to consider. Okay, here's the thing. If we start off with just this. Idea of how people see money, I. Think that it's a very telltale sign. I have had the blessing is working for decades as an advisor, as a CPA, helping people build businesses, helping people. Buy and sell, build wealth, get out. Of debt holes, kind of recover, all those things. I had a chance to get an. Inkling, an insight into how they see. Money and the struggles they have with money. And one of the things that I. Noticed is that a lot of people. Believe. That money is hard and that. They should struggle financially. That's just the way of life. And I get it. You hear a lot of it in the media. This is not to say that people aren't having financial problems. No. I am one that says that no one has money issues. They have money symptoms. They're symptoms of the choices, decisions, and. The behaviors of the past that are coming home to roost. Now, that also means that if it. Is a result of behaviors and choices. Then if I make different choices and. Have different behaviors, we get different results. Now, I get that it can be confronting. You might sit back and say, no, it's not my behaviors. And you can fight it. But I can tell you that from experience, if we just shift behaviors, we just shift decisions. If we just shift choices, things will be different. Okay. But people expect to struggle financially because. We talk about it all the time. Okay. And there are people that are struggling financially. Part of it is because they haven't been educated. Part of it is because they haven't been given the tools. Part of it is because we demonize money and we don't want to have. The conversations why money is just a tool. Let's have the conversations. Let's give you the skills, let's give you the tools, let's give you the understanding, because I can promise you this. As complicated as you think it is. It is far less complicated than being in a financial struggle. Money and building wealth is actually a simple process. It takes a handful of things to. Do, but it needs to be done over time. We just got to educate you and give you the tools to make that happen, rather than sit back and say. Look, people struggle financially, and saying, I'm. Willing to accept that as a fact. How we challenge it, okay? Because so many people just assume, or. They accept it as a fact. We've normalized financial struggle. We've normalized being in debt. We've normalized the idea of living check to checks. 56%, 61%. I don't remember the exact statistic. I know. 56% have said that he cannot sustain themselves. If they had an unexpected bill of$1,000, they'd have to go into debt. They didn't have. They don't have the cash on hand. That is a travesty. That is a problem, but it isn't an unsolvable problem. The problem is solved by education, by training, by income, for sure. But if we understand how to deal with the income and do the things right with income, we won't be in that place in the first place. And so when we normalize financial struggle, when we normalize it by constantly highlighting. It and making it okay, then we. Just take it on. And I think it's a mistake that we do that. Many are living in debt. Okay, here's the next piece, is that. We'Ve not only normalized financial struggle, but we've normalized debt. Living and living paycheck to paycheck. Like I said, over 60% are living paycheck to paycheck. Even. Even 47%. They're making over$100,000. They're making six figures. They're still living paycheck to paycheck. How is that? It isn't because of the earnings. It is because of the spending. It's because of not understanding money management. It's not having a process. It's not having a system. It's not following the wealth priority ladder. It's not having a cash resource plan. It's all those things. It's not the income. But we're not having the conversations. So we have a lot of people that are living in debt. And we've. Made it okay, because we make it easy. We've got credit cards. We've got 0% financing. Heck, we'll finance cars for 72 months. Are you kidding me? I know I'm in a soapbox here. But I think that when we start. To understand how this plays out, we. Realize how we can also impact it, how we could also reverse it. The other element is that if we. Are expecting to struggle financially and we. Accept the fact and we assume and we normalize it, and then we're living debt in debt, and we're willing to accept paycheck to paycheck, then we also resolve ourselves, and this is the next piece that keeps us in this place. To say, well, that's just the way it is. Just the way it is. And I can't change it. Here's the question. What can you change? Certainly there's things you can't change. I can't affect that the stock market goes up or down. I can't affect whether we're in a. Recession or a depression or a boom time. But there are some things I can affect. There are some things that I can control. Your financial journey is built on your ability to control the controllables and prepare for those that you can't control. But when we sit back and just. Say, that's just the way it is, and we accept it, what we do. Is we settle and say, okay. But. That'S not the truth. There's plenty of stories of people that ended up in. Look at. I lost one third of everything I own. Between me and two friends, we lost over four and a half million bucks. One third of everything I own. And I could have sat back and. Said, that's just the way it is. Or fought back. Which what we did. And I think that's the thing that we need to consider, is that whatever. Your facts and circumstances are, okay, whatever they are, you get a chance to. Make a new decision, you get a. Chance to make a new choice, you. Get a chance to do something different. It doesn't. Your current circumstances, it's like the wake of the boat. The wake of the boat is behind you. It tells you where you came from, it may inform you, it may educate. You, it may prepare you, but it doesn't guide you. It doesn't set your trajectory, it doesn't set your direction. The rudder does. The rudder is your decisions. They're your choices. They're your skills, they're your knowledge, all of that. So just because we've had a rough past, and trust me, I've done my. Share, doesn't mean that we are destined. For a rough future. We got to make some different choices. And we got to build something differently. To make that happen. Okay, here's the other thing that I think keeps us broke is that we. Start to look at this idea of budgets. People hear it and they go, budgets. Budgets are like diets, okay? And the root word to diet is die. You know, and here's. Here's what I mean by this. We tend to look at budgets as restrictive deprivation. Oh, you're going to tell me what. I can't spend, I actually reverse it. We talk about it in the context of a cash resource plan. I believe that every dollar that comes into your life needs to have a job description before it ever comes into your life. So if I know that I'm making $3,000 in a month, then I need to allocate every dollar before I make that money. Because you never hire employees without giving them job description tasks, goals and metrics you're going to measure them against. But we do that with our money. Why? So when we give it a job. Description, which is the budget or the. Cash resource plan, not only does the dollar know exactly what to do, you. Know exactly what to do with the. Money, and it isn't restrictive, it's your. Permission to spend guilt free. Think about it. If I build a cash resource plan. Or a budget, whatever you want to call it, and it says this hundred. Dollars is for eating out, then you're. Going to go eat out and you can spend that. You can spend a $100 guilt free because it's a permission to spend. It's not tying your hands, it's allowing. You in advance to say, this is for fun stuff. This is for the mortgage, this is for the rent, this is for the utilities, this is for medical, this is for clothes. It's done upfront and now you have. The permission to spend. But we tend to look at things. Like budgets, like diets. We think that it's depriving us, it's holding us back. It's not, it's not. Then the other thing that I think. Keeps us broke, especially in some of. The developed countries, is this idea of. Expressing ourselves to the. By consumption. So driving a luxury vehicle, and maybe. We can't because we, we want to. See, we want everyone to see us that way. The, you know, the clothes we wear, the. We're very externally motivated in many cases as a society not, there's plenty of others that aren't. So I don't want to make general statements, and I know that I'm kind of making general statements here, think that when we start to understand what is driving culturally, societally, we, maybe we start to see things a little differently. But when we are so focused on how we are perceived on the outside, we start to make buying decisions and financial decisions based upon the things that they see of us, which require us to buy things from a consumption standpoint, luxury vacations, big things that I'm parading on social media, all that stuff. And if it's not truly giving you joy. If it's not truly giving you fulfillment. Why are we doing it? To satisfy people that we don't know. But what it's doing is it's causing. A societal kind of mechanism that gets. People to buy things they can't. They can't afford to buy. They put it on debt, so they're. Struggling, and they end up. Why do we end up broke? Because we're making bad money decisions. You. Know, so we end up in that. Situation because we are so focused on materialism versus richness. Richness is how we experience life. Richness can come at the hands of just. It could be a teepee in Montana. It doesn't need to be some luxury hotel. What are the joy points of your life? What are the things that bring you joy? Look, my wife and I love taking. Not lavish, but nice vacations. Do you know what we love more? Just sharing time together, walking on the. Beach. Even shopping, even if we don't. Buy anything, just going and spending time together. And so what ends up happening is. That we look for the richness in our lives, the joy points that we. Have that bring us joy, to allow. Us to make choices and decisions that we know are going to lift the. Fulfillment line more so than just buying stuff. We also live in what can be deemed as a rat race culture. Go, go. More, more, more, more, more, more. Keep achieving, keep achieving, keep achieving. Here's the thing. I got in a bike accident in 1990. Oh, my gosh. It was. No, it was 2009. 2009. I got on a bike accident, and. I flipped a bike. I ended up on my head, ended. Up with a grade four concussion. I had no feeling on the right side. I was stuttering. And a dear, dear friend of mine. Comes to me, take me out. I got out of the hospital. I'm in a neck brace. And he takes me out to. To a sandwich shop, and he looks. Across the table at me once we. Order, and he says, how much is enough? What do you mean now? He was retired at 35, 36 years old. I said, what do you mean? Look, I just. I got a grade four concussion. How are we having a conversation about. The philosophy of life? What are you talking about? There's no, seriously, how much is it? You got on that bike, distracted and angry, and you ended up in an accident. You ended up in the hospital. Do you even know where your finish line is? Who's defined the finish line? And I think that we get in. This rat race culture of more, more, more, and we never find fulfillment. We never find the gratitude and the appreciation. What is. And we keep looking at what could be. Now, what could be is great. Let's keep that as a dream. But let's not do it without the gratitude for what we. Because that's the. Challenge that starts to drive things where. We find ourselves in a situation where we're overspending, consuming stuff. And then we wonder why, even when. We have all this stuff, why we're. Not happy, why there's no joy. Two other things that I think contribute. To this idea of why is everyone. Broken in a rich country? And that is we play the debt Ponzi scheme. We're swapping our future for today. We are taking what we want today and we can't afford it. So we put it on credit cards, we put it on financing, we put it on a pay later type of plan. You are sitting back and saying, I am going to forsake what I want. Most for what I want more. So, and hear that again. If what you want most is financial. Freedom, but what is driving you is what you want more of today. You're forsaking the big thing the most for the more. And that's the thing that, and so. Now all of a sudden we spend. Our tomorrows, our dollars that we earn. Tomorrow by financing it just so we can have something today. And most of the time that something. Today is a consumable that goes away. But the debt doesn't. The debt stays and it takes us time to pay it down. And so we're swapping our future for our today. And that's just, it's a way of life. Debt isn't a big deal. We just, we seem to do that. And now all of a sudden we're. Living with the burden of debt. Look, all debt has two characteristics. It costs. That's interesting. It stresses. At some point we got. To get rid of the debt. At some point we got to at. Least get rid of the consumer debt, the destructive debt, the stuff that is for consumables for today. But we live in that society. And you couple that with this last. Piece and that is this. We've done an extremely good job to create frictionless purchasing. Think about it. All I got to do is tap my phone and I buy something. There's no friction in the buying decisions anymore. Think about what it would be like. If every time you had to buy. Something, you had to count out cash. You're watching a lot of cash just. Go down or you had to go. And do a wire transfer. You had friction in the buying decision. I remember, I remember when I had. A nutritionist and he said, I want. You to log everything you eat, everything. That passes the lips, including water. I want it to log in this book, and we're going to go through it. Now, remember, as I start doing that. I pick something up to eat it. I go, ooh, I got to log. It and I put it there. When we have frictionless buying, we will over buy. And they've done that with credit cards. They've done it with, with tap apps, they've done it with storing credit cards and systems. What we really need to do is reverse that. We need to put as much friction in our buying decisions, whether it's time and space, for a 48 hours time clock that says, I'll put it in. The cart if I want it, and. I still feel compelled to get it. In 40 hours, then I'll buy it. And we need to remove the friction. From our investing decisions. We need to make our investing into our 401 ks, into an iras, into our brokerage accounts, into all of our financial future, automatic. No friction, no decision. I don't have to push any buttons. I don't have to turn any dials. It happens automatically every time I get paid. But this is why I believe that. There'S many countries that are considered well to do countries, but people struggle financially. It's because of the expectations, it's because of the culture, it's because of the mindset. It's because of how we practice our. Spending and all that. So I hope that helps. Okay, here's what I think you need to do. A couple things. I think you need to be deliberate. And intentional and conscious and aware of your money. The money that comes in and what the. What you're doing with the money. That means that every dollar has a job description. Every dollar before you. Before you. You earn the dollar, you know exactly what it's going to do. So when it comes in, there's no. Question, there's no temptation. There isn't frictionless, frictionless spending. There's none of that. Okay. You avoid consumer debt. You avoid destructive debt. You pay for things in cash as best as you can. I don't mean cash cash, but. But you don't finance consumer consumables. You make investing a priority. And you. Work to build your income on the prop in the process. And you don't allow outside forces, whether it's marketing, peers or social media or the media, to help you make your buying decisions. You make them based on your values and your plan and what you want. And you live your life your way, not based on expectations of anyone else, right? When you do that, you won't end up as statistic. I hope this helps. All right. Till we get a chance to see each other. Another episode, another show, or on the. Road, always strive live a life that I. Cheers.