What it Means to Live Within Your Means

Many of us have surely thought of ways to live a financially comfortable life. I know I have, and I have my reasons. But if we all have the same aspirations, why is it that only a few actually get - and stay - rich?

What separates those on their way to financial freedom from those who, let's just say, are on the totally wrong route?

The answer is simple - too simple actually. Those in one of the two groups live within their means.

C'mon. I must've heard of that a thousand times already. Can't you give me something new? A surefire way to get rich?

Unfortunately, no. You must have heard of the advice a thousand times, and the reason for that is that it works! Coupled with the practice of delayed gratification and having financial knowledge, the principle of living within your means is the surefire route to financial independence.

Why? 

Finance Friday: You Need an Accountability Partner

Image from Google

Left to my own devices, I would have probably wasted my money on beautiful but unnecessary things.

But I did not.

I may be a master of delayed gratification but that doesn't mean I have self-control of steel. To be honest, I think of shopping all the time! One of my favorite pastimes is online window-shopping where I admire beautiful things. Bags, shoes, furniture, books, homeschool supplies - these are only some of the things in my perpetual want-list. But I haven't given in to buying any just yet.

Why?

Because I have an awesome accountability partner: my mother.

Finance Friday: Tips to Practice Delayed Gratification

 

You may understand "delayed gratification" and what it means, but do you practice it?

A couple of Fridays ago, we talked about this secret key to wealth that we call "delayed gratification." We found out how it works and why it should be your ultimate mindset if you want to achieve success in your life.

Let's admit it. Living this kind of lifestyle is easier than done. But another cliché that speaks truth is this: it always seems impossible until it's done. Oh yes, it's hard, but it's not impossible!

In fact, if you begin taking baby steps now, I'm sure your future self will thank you. And me. Haha! Kidding aside, if you're clueless and don't know where to begin, fret not because I'm about to give you practical and doable tips:

1. Create a budget and maintain it.

I firmly believe that writing down should be the first step in reforming your personal finances. This does not only tell you how you can save on your finances but also show you how much money you really have after taxes. The latter is important in keeping in mind how to live within your means.

For more information on budgeting, please click visit this post: Why You Need a Budget.

2. Know the difference between needs and wants.

This is a no-brainer. I'm sure this is self-explanatory. No, a pair of Raybans is not a need.

3. Stop acting on impulse!

Finance Friday: The Secret Key to Wealth

So I guess many of us have already heard of the famous Marshmallow Test.

You know, the study conducted by Stanford University in the 1960s on 600 4-year old children. A child was given a marshmallow and was told that if she doesn't eat it right away, she'll have another one later.

Basically, the two options were these: one now or two later?

Image from Youtube

It sounds like a no-brainer, but to 4-year olds, that's tough. I mean, who wants to wait? But only 30% passed the test. Later in life, the researchers also discovered that this 30% are the more successful of the group. Interesting, right?

So what's the point I'm driving? Simple. The secret key to wealth is more than self-control; it's more than sheer will-power. The secret to wealth is this: