Are You Living Above Your Means?

Are you living above your means? No matter how much money comes into your household you seem to always magically expand your expenses, and at the end of the month there’s nothing left? This is a really dangerous trap. Personally, I have been massively in debt over the last 12 years or so in my entrepreneurial journey. I actually learned so much about managing my finances, and really learning how to live way below my means to be able to actually plan for the future, so it’s really about some key financial disciplines that you need to put in place because if you don’t have clarity and discipline then you’re never actually going to progress in financial means, so if right now you’re experiencing that there’s never enough money, that expenses are always just popping up when you seem to have created more income, then you really need to set some clarity and you need to set some discipline.

    One of the greatest financial disciplines is actually knowing exactly how much money you need right now for your lifestyle, and perhaps evaluating where you can decrease some of the expenses. Number two, you need to really make sure that before any expenses go out every week or every month make sure you’re saving some money, at least 10%. You could even start with less, but putting those disciplines in place is going to prevent you from living above your means, beyond your means. It’s really about emotional clarity of where you’re heading in your finances. It’s so closely connected to feeling good enough. It’s so closely connecting to knowing that we can achieve whatever, is actually that anything is possible for us, whatever we want.

    As you’re looking at your finances maybe you need to really set some clarity around what are your goals and your finances long-term in the next 20, 30 years. Where do you want to be? How much money do you want to have invested? Where do you want to invest it in? If you don’t already know how to do that, that’s okay, too. Perhaps the first step right now is to get some financial education, and you know what? As you’re expanding your income it’s going to be increasingly important to be financially savvy, so clarity and discipline will get you living below your means and actually being able to plan for the future.