Every day, very early in the morning, he wakes up and rushes to the office to work hard on tasks he doesn’t enjoy. In fact, he hates the work he does with passion but he still works hard for long hours and return home very late in the night. He hardly has time to do things he likes or spend time with his family. At times in the office, his boss says some unpalatable things to him and he swallows it. He dares not protest, not because he respects his boss but out of fear of losing the opportunity to continue with the job he hates with passion. This sounds ironical. Doesn’t it? Here is a man doing what he doesn’t like and is being insulted and stripped naked, but will rather swallow all the bitter pills being forced through his throat even though he has the freedom to quit. One may wonder what has happened to that freedom. Why is he unable to exercise his right to quit? Obviously, something very fundamental has gone wrong. Although, in theory he has the freedom to quit, he has emotionally lost the freedom. He is emotionally enslaved. He keeps on enduring the difficult situation without taking steps to remedy it but only hope that one day things will change. Does this paint a picture of someone you know or probably yourself? Do you want to learn how to get out of the messy situation? Do you want to regain your confidence and freedom? Please read on…
It’s Time to Do something and Regain your Freedom
Have you ever thought of why you are in this predicament? The reason is very simple; you have failed to get smart with your finance. Consequently, your financial survival is strongly tied to your current job. You have been working hard to finance your life style rather than working smart with your finance. Now, it is time for you to stop working hard for money and get smart with your finance. This is the only way you can regain your freedom and escape the rat race.
Someone might be wondering, how do I get smart with my finance? After all, I have been very prudent with my money, I am leaving below my means. What else can I do?……………… Hold it! Don’t go any further. You are mistaking being financially prudent with being financially smart. When you are financially prudent, you tend to live consistently below your means hence, getting rich and escaping the rat race becomes a pipeline dream. You will continuously deny yourself of most good things of life. Ultimately, you may never regain your financial freedom. However, when you are financially smart, you enjoy all the good things of life and simultaneously enjoy your freedom.
Getting Smart with your Finance
If you are willing to get smart with your finance, there are rules you need to follow. Let me briefly highlight some of them to round up.
- Work hard to create ASSETS. Asset for this purpose is whatever brings money into your pocket.
- Let your assets finance your lifestyle and LIABILITIES. Liability for this purpose is anything that takes money out of your pocket. The point I am making here is that you should stop working hard to acquire liabilities, rather create assets that will work hard to finance your liabilities. For every liability, there must be an asset working hard to finance it. This is what I refer to as the ultimate principle of financial freedom. Imagine a situation where all your liabilities – your cars, your vacations and every other aspect of your lifestyle have assets working hard to finance them. What this means is that whether you work or not, you can perpetually maintain your standard of living. At that point you can decide to fire your boss anytime you get tired of him.
- Before you make any investment decision on any asset, ensure that the asset will give you immediate positive cash flow. Note, the positive cash flow must be now and not when you sell the asset in future.
Let me give a simple example. Recently, I got a flyer advertising real estate properties located somewhere along Lagos-Ibadan express way. Great deal of life time! Two bedroom flat going for =N=90,000 monthly. Great deal? Guess what I did, I just asked a very simple question. Can I let out the flat for =N=90,000 a month in that location? The answer was NO! That means I will have to be coughing out =N=90,000 from my monthly income. This might be a good investment for someone who is applying solely what I call “Prudential Strategy’ in his finance. He goes for the investment and start paying =N=90,000 monthly for the next five years or more. His only reason for the investment is the possibility of future price appreciation. But the question now is this, ‘how many of such investment can he support with his income?’ How will he support the investment if he happens to lose his job? You can see why such a person will lick every kind of ass in the office to cling on to his job. A smart investor on the other hand will rather keep that money and look for a better opportunity, an opportunity that will offer both future price appreciation and immediate positive cash flow. I hope you can see clearly which of the investors will be more desperate to sacrifice his freedom and cling on to the job he hates with passion. Thank you for reading, have a great week!
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