dream big

Your financial dream; this is the fun part, go ahead and dream, but make sure you dream BIG! Let your imagination go. What do you want your financial future to look like? Does it involve debt? Harassing calls from collectors? Living paycheck-to-paycheck? (that’s not a dream, that’s a nightmare)

 

According to the survey below, paying off debt is the number 1 financial priority. I certainly agree with that priority, but I would ask a basic question, WHY? I would say because most people want financial stability and the ability to build wealth. The best way to have financial stability and the ability to build wealth is to be debt-free!

 

To have the motivation to achieve your dream, you need to establish why you have the specific dream you have; otherwise, you might give up when times get tough, and they will get tough; the Bible says “in this world you will have trouble” (John 16:33);

 

“You hungry for failure? Maybe a side of unemployment? ‘Cause that’s what’s for lunch. ” Wolf from the movie Hoodwinked (Patrick Warburton)

 

Maybe you want to be debt-free in order to save up for that dream home. Maybe you want to be generous (help others) in retirement. Maybe you want the peace of mind that comes from being debt-free, true financial peace; imagine what that might be like (no debt payments to anyone!), give it a minute to soak in; paint the picture, burn that image into your frontal cortex.

 

Almost regardless of your specific dream, being debt-free should be job one because your ultimate goal will be that much easier to achieve without the burden and stress of debt. The Bible says the borrower is slave to the lender (Proverbs 22:7); that doesn’t sound good.   .     .

 

I believe the very first step (#5 in the survey below) in any successful financial process should be to establish an emergency fund (at least $1,000), because an unexpected expense could derail that wonderful dream (owning your dream home, with a leaking roof and no money to repair it? Sounds more like a nightmare to me.)  I want it to be more than a dream though, (dreams only come true in the movies); I want it to be a goal – a goal with steps, milestones and most importantly, a plan! (aka a budget).

 

“A fool with a plan can outsmart a genius with no plan any day. And your mother and I think we have a fool with no plan.” Father of T. Boone Pickens. I have read his biography “the first billion is the toughest” – I highly recommend.

 

Top 5 money management priorities (per the Principal Financial Group Annual Financial Well Being Index 2016)

 

1)            paying down debt

 

2)            saving for retirement

 

3)            creating/maintaining a budget

 

4)            saving for a major purchase

 

5)            building a savings account for emergencies