The Discipline of Decisions
What do you think is worse: the pain of discipline or the pain of regret? Would you rather discipline yourself in small ways today to make a difference tomorrow or look back and see that your financial life is not where you want it to be? You can take some small steps today to make a big difference down the road.
1. Adjust your priorities. If you are like most people, you spend money on things that you really don’t need. Or, you don’t really manage the money you do have – you just spend as expenses come up. It takes time to adjust your priorities and develop a management attitude about your spending habits but it’s essential.
2. Define a want vs. a need. In your daily spending habits, take a look at things you buy that are a “want” and a “need”. Wants and needs can be large or small and they make a difference: Do you need a brand new car instead of a cheaper used car or do you just want a brand new car? Do you need to dine out for lunch or do you just want to dine out for lunch?
3. Take small steps and build up. Getting started on better spending habits is easy – you just have to start small and build up. Instead of dining out every day, bring your lunch from home. Want to start even smaller? Instead of buying a soda from the vending machine at work, bring a soda from a 12-pack you bought for less at the grocery store or just drink water.
Set goals and have a plan
You can’t reach your destination if you don’t know what it is! What do you want out of life? What are you trying to achieve? Setting goals gives you two things:
1. An incentive to make the sacrifices necessary to stay on your Fast Pay Plan
2. Benchmarks along the way to gauge your process
Two types of goals
Short-term goals are very specific goals that are quickly realized. A short-term goal could be a summer vacation for your family or a reward for paying off a small debt. Short-term goals require a short period of discipline and help you see immediate results from your efforts. Changing your every day spending habits are short-term goals.
Long-term goals require a little more planning and discipline over a longer period of time. A long-term goal might be college for your children or building your dream house. If your goal is to become debt free, your Fast Pay Plan is a long term goal.
The six steps to reaching your goals
Many years ago, a man named Napoleon Hill came up with a formula used by many successful people who became financially independent. This formula is still as solid today as it was in 1937 when Hill’s book was written.
1. You must have a specific goal.
2. You must have a specific time to reach your goal.
3. You must write it down.
4. You must develop a plan to achieve your goal.
5. You must decide what price you are willing to pay.
6. You must think about your goal every day.
The good news is you followed these steps when you set up your Fast Pay Plan. Now apply these steps toward goals that change your spending habits.
Condensed from “Think and Grow Rich” by Napoleon Hill, originally published in 1937.
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