Why Your Habits Determine Your Financial Destiny

My mentor recently gave me a book to read. Atomic Habits by James Clear.

According to the book, your financial situation is a result of your habits about money.
Rich people simply have better money habits than the poor or middle class.

The past few months, I’ve had one of the most challenging period when it comes to finances.
When I looked back, it is all because of my money habits.

Over the last 8 years, my business has allowed me to earn passive/residual income.
This income has allowed me to support my family and have the freedom to spend time with them.

This is one thing I would always be thankful for, for having built a business
that would allow me the freedom to spend time with my kids.

However, one thing I didn’t know then was the idea that “passive does not mean permanent.”

In any kind of business, changes would eventually happen. Ready or not.
In my case, I wasn’t ready. It didn’t happen abruptly. But I still could not adopt to the changes fast enough to put a stop to the bleeding in my finances.

In the end, I had to make some major sacrifices just to keep the boat afloat.

Thankfully, the changes allowed me a little breathing room, for the meantime.
I am not out of the woods yet, but I feel fortunate to have gone through it.

The experience allowed me to re-examine how I view money as part of my life.

In the world of business, there’s often the idea to focus on marketing “the lifestyle.”

Is it effective? Yes, sometimes. But not always.

I realized that people, of course, are attracted to a certain lifestyle.
We all desire to look good in pictures, to have a lot of friends,
to travel to beautiful places, to own the most luxurious cars or houses.

There is nothing wrong with that.

However, when you identify your self-concept or your value too closely
to this social status, you tend to succumb to the pressures of living up to this lifestyle.

We all know that there’s more to this than meets the eye.
Success is rarely easy nor simple.

There’s the unglamorous part where you are hustling day in and day out, stressed out
in just keeping up with the lifestyle that is supposed to free you up.
But now it has become a cage.

You feel so restricted. You are now posting for likes or engagement, rather than
share what you really value and who you really are.

For sometime, I tried to de-activate my Facebook account.
I wanted to see what happens.

At first, it was really hard to do. A few days after, I re-activated it again because
I wanted to upload a picture or video.

Eventually, I managed to de-activate it completely with one exception.
I had to keep my messenger active.

Maybe it’s the fear of missing out. I don’t know.

After a month, I realized I didn’t miss much. Of course I still went back and activated it.
I had to post pictures of important family events, just to update family and friends.

Staying up to date with social media has increasingly made little sense for me.

This is one habit. that I would hope to find a balance on. I am still trying. I am afraid the only logical step would be to completely get out. We’ll see.

Recently, I had a chance to facilitate cashflow 101 boargames.
I was surprised to see that many people still haven’t played the game yet.

Here are some of the things I observed.

People are naturally risk-averse. They would buy a few shares of stocks here and there.
Just keep them and not do anything with them. They would pass on opportunities after opportunities.

After an hour of playing, they are still nowhere near the goal of getting out of the rat race.

They could not see the opportunity right in front of their eyes.
Maybe it’s just that. We see what we are trained to see.

At the start, the players are so happy whenever they receive their monthly paycheck.
In the game, there’s always this gradual shift on what the players focus on.
At the start it is all about the paycheck. But as the game goes on, they would rather get an opportunity card than a paycheck. Because they know, a paycheck would only get you so far.

The real key to getting out of the rat race is in taking advantage of the opportunities you are dealt with.

Just like in real life, having this shift in mindset and habits takes a really long time.
In my case, it has been years since I am out of the corporate world but I still find myself clinging to the allure of security.

Your habits can also change. In the same way that your weight can fluctuate with every fad diet that comes along, so too are your finances if you succumb to every fad about money.

But the fundamentals about money habits is still the same.

Make as much money as you can.
Spend less than what you earn.
Protect your money and make it grow.
While keeping a healthy perspective in life that there’s more to life than money.

Money is only a magnifier of the things you value in your life.

When you use that money to grow your relationships with your family, your love within your family will grow.

When you use that to keep a healthy lifestyle, then you will have a healthy mind and body to grow.

When you use that money to bless other people through tithes and fund ministries, then your spiritual life will grow.

It’s a lifelong process to build a habit. The only way to replace a bad habit is to create a new one. The good news is that you can start a new habit anytime. The best moment to start one is now.