Tony Robbins’ diagram above, the success cycle, is extremely important to understand and practice before we start our financial freedom journey.
He wrote “We all have unlimited potential- but often our results don’t reflect that. Why? Because our unconscious beliefs cripple our results. Our nature is to only invest energy into that which we believe will produce the outcome we seek. Therefore, when we believe something is not going to work out – even unconsciously – we sabotage our potential by taking halfhearted action. Little action equals lousy results. Lousy results equal uncertainty and disheartened beliefs. It is a vicious cycle that only ends when you decide to change what you’re putting into it. The more resolved beliefs we have about achieving something, the more potential we will tap. With greater potential comes greater action. Greater actions yield greater results.”
I would like to share 4 limiting beliefs that we need to bust before starting our financial freedom journey
1. “I AM JUST NOT GOOD WITH MONEY”
Research shows that the clear majority (e.g. 60% of Americans) have neither a spending nor an investment plan. We rarely read or educate ourselves about the essential money and investments basics. There is no one born with good or bad money’s skills, it is all about effort and continuous learning. Two decades ago, I didn’t know much about money. However, I started working hard to increase my financial knowledge by reading many books, attending seminars, listening to CNBC and Bloomberg for long hours, as well as joining investment sites and blogs, taking many courses as well as paper trading. This effort enabled me to develop and manage multi-million portfolios of stocks and properties across 6 countries.
I summarized the key learnings of my 20-years journey in the “5 Steps to Financial Freedom” course which I recommend to accelerate your financial learnings.
2. I DON’T EARN ENOUGH TO SAVE
Albert Einstein said “Compound interest is the 8th wonder of the world”. You will understand the reason behind Einstein’s statement when you know that a small amount like $485 invested per month at 10% interest rate will save you over $1 million if you keep reinvesting the earned interest!
This is the power of compounding that can enable you to accumulate substantial wealth. It is all about consistent saving over a long period with reinvesting interest.
Let me tell you the story of a simple employee in an American company that never earned more than $14000/ year. He consistently saved 20% of his salary every month considering this as wealth tax (i.e. must do vs. optional to do). He also saved all his bonuses. Do you know what the wealth of this employee was when he retired at age 90? Over $70 million. This is again the magic power of compounding!
The first step to creating financial freedom is to tap into the power of compounding. Make your money work for you so you don’t have to. To take advantage of the power of compounding today, you must make the important decision and decide what portion of your paycheck you will set aside and pay for the future. Even the smallest amount of money combined with the miracle power of compounding, can give you financial independence without having to make a fortune in annual income.
3. MONEY DOSEN’T BRING HAPPINESS
It is a fact that money can bring happiness. Recent studies have proven that Money can make us happier. Scientists have shown that spending $5/day can significantly change your happiness. It isn’t the amount you spend, but how you decide to spend it.
I like the following statement from “Happy Money: The science of smarter spending” book:
“Every day spending choices unleash a cascade of biological and emotional effects that are detectable right down to saliva”
My top pick of their list of spending which increases happiness:
- Invest in experience: Travel, learning new skills, taking courses
- Buying time for yourself: outsource our most dreaded tasks (scrubbing toilets!)
- Investing in others: people get more satisfaction spending money on others!
Money can also reduce a significant amount of daily stress. How many times have you uttered the phrase, “I’ll never make enough money”? Or perhaps you just thought it. The stress caused from such a thought is daunting; nearly three-quarters of Americans surveyed attribute their stress within the last month to worries and concerns about money.
4. I AM TOO OLD TO START NOW
Many people made amazing achievements after age of 50, 60 and even 70.
The few stories below demonstrate clearly that age is just a number and is never a barrier if you keep moving consistently and relentlessly towards your target.
- At Age 60, George Bernard Shaw finished writing, “Heartbreak House.” This was considered by many to be the greatest work of his career, but it took almost his entire career to come up with the right combination that resonated with people.
- At age 77, John Glenn became the oldest astronaut to ever go into space. When I think of the training, the physicality, the mental abilities, and the sheer drive to do something in your lifetime, I am continually impressed that he could accomplish this.
- At age 92, Paul Spangler finished his 14th marathon!
The common thread of all these individuals is persistence, belief in self, and not putting time limits, age limits, or any type of constraint upon themselves. They simply decide they have a goal they were going to accomplish, and they kept trying until they accomplished it. It shows to all of us that it is never too late to do what we want to do, and be who we want to be.