The end of the year is something to plan for. They end of the tax year is December 31 and not April 15! Planning in advance prevents mistake and over payments. Seek the counsel of your tax advisor to that you have the proper planning steps in place to end the year properly.
The good news is that working with a tax professional provides you options.
Not only do you not have to deal directly with the IRS (we do that for you), but if something did come up requiring their input, we have a “Practitioner Priority Line” that isn’t available to those tax do it yourselfers who try to go it alone with off-the-shelf software.
Let’s not have that be you. We’re here and we’re ready to get cranking on your behalf.
(And, of course, your friends’ behalf too: have I mentioned that referral clients are our favorite kind of clients? Please feel free to send your friends our way … despite how busy we are, we make a point to make room for friends referred by our clients.)
In this article I’m putting on my “financial coach” hat to encourage you to perhaps approach your finances in new light. Many of our clients have many of these principles pretty well nailed, but this might push you further into a more financially healthy and profitable direction…Wealth building statistically has come from the ownership of real estate. When analyzed 7 out of 10 people in this country build their wealth because of their ownership of real estate. The others, 3 out of 10, build their wealth because they owned a good business or they were good inheritors.
Steve Pybrum’s First Key To Building Wealth
“Patience is bitter, but its fruit is sweet.” -Aristotle
There is no shortage of financial advice out there – online of course, or from your second-cousin, Karl. But not all advice (especially from Cousin Karl) is valid for everyone.
The good news about having us in your corner, of course, is that I can answer questions about your specific situation that you’re going through. So if you have anything pressing, please do give me a call and I’d be glad to help. (805) 962-1040
But for all the advice out there, a few guiding principles undergird anything that is worthwhile — and today we discuss one of those: delayed gratification and how it will earn you greater wealth. Now I’m not guaranteeing you a lifetime of riches … I’m simply stating the fact if you can be patient, it will pay off in the end. Here’s how you should begin…
Delayed gratification is the ability to resist the temptation of immediate rewards in favor of long-term goals. It involves self-control, patience, and the willingness to endure short-term discomfort for greater future benefits and success.
Kick Consumer Debt to the Curb
Although some debt can be useful when buying a house or in certain business situations, it often represents a reduction of cash flow. Consider ways you can eliminate any existing debt, and methods which would enable more cash spending. It takes a little extra effort, but ridding yourself of debt is typically the first step toward building wealth.
Though at the same time we support the use of borrowed funds to build your real estate empire.
A new TV might be fun today, but what if you took that money you were going to spend and put it toward debt-freedom? Choosing this option ensures the TV will come someday … and we guarantee it will be bigger and better when you’re financially ready.
Thousands of Small Decisions. Not a Few Big Ones.
This is where financially-based delayed gratification is tough. And it feeds off the TV example.
What would it look like, instead of saving 6-10% of your annual income, to save 20%, 35% or even 50% of your income? Think of your wealth after saving for 10+ years?
You might be thinking, “How is that fun for anyone now?” But I’d argue that it can actually be a lot more fun. Why? It means creativity can take place. Instead of going out to eat at a fancy restaurant, make dinner from home and go eat somewhere scenic in town for a picnic (where there’s nobody to tip). That’s one example among thousands, of how living below your means helps you save for the future. There are volumes written on how to save rather then spend, spend, spend. Take your child to the park and let them fly a kite instead of a long weekend skiing in a retreat resort. Thinking of new pastimes can be fun and be the method of reducing your spending and wiping out your consumer debt. Live for tomorrow and don’t try to have everything today.
There is nothing more rewarding in life than to work side by side with your life partner and cut back a little bit as you both contribute and cooperate toward reaching a certain and specific financial goal together.
The Power to Invest
If you are new to investing, or are thinking about investing in the near-future, I usually like to recommend an undervalued (and therefore likely to grow) blue chip stock (not likely to collapse), with a history of above-average dividend yields (steady cash flow).
Start there. Let’s not worry about boiling the ocean just yet.
And if you don’t know much about investing, that’s OK! This is part of the delayed gratification piece as well. It takes time to research and converse with trusted sources. I’d love to chat about this topic, and point you in the right direction toward strategic investing.
It is popular now to have a 401(k) plan at work. The incentive to have this is because the employer at some percentage rate matches your investment. The 401(k) is a form of long term savings where the government has shifted the responsibility to the individual to make good, safe and prudent decisions about your financial future.
The 401(k) plan is the starting point it is not the eternal salvation! With the 401(k) comes the duty to yourself to be responsible with these funds. Behind the scenes your employer has chosen an investment advisor that is suppose to make good choices as to what your money is invested in to help make it grow.
Play the Tape Forward
This bit of advice is not as “practical” per se, but it’s still incredibly valuable in terms of entering the right state of mind to build wealth.
With every purchase you make from here on out, I want you to play the tape forward in your mind, and think about how that purchase will affect your life. Every little purchase (a smoothie) all the way to the big ones (a week-long trip to Europe) will have an effect on your financial health. Everyday can be fun, its up to you to make it that way. There is not suggestion to deprive one’s self of fun and amusement.
Quite the opposite.
I want you to have the best time in life (eventually 🙂 ), while setting yourself up to help others and make a healthy financial impact on the world.
Spending less and enjoying life more is about finding a balance between immediate pleasures and long-term financial security. To achieve this, start by creating a budget that outlines your income, expenses, and savings goals. Identify areas where you can cut back without sacrificing your overall happiness, such as dining out less frequently or reducing impulse purchases.
Focus on experiences rather than material possessions. Invest in activities that bring you joy and fulfillment without breaking the bank, such as hiking, cooking at home with loved ones, or exploring local attractions, long walks around your cities attractions or nature trails. Cultivate gratitude for what you already have, shifting your focus and perspective from constantly wanting more to appreciating the abundance you have in your life.
Building a strong financial foundation requires discipline and planning. Prioritize saving for emergencies, retirement, and other long-term goals by automating your savings and investing in diversified assets. Consider seeking advice from financial professionals to help optimize your investment strategy and minimize unnecessary risks.
As you accumulate wealth, be mindful of your spending habits and avoid lifestyle inflation. Instead of splurging on luxuries, prioritize investments that generate passive income and contribute to your financial independence. By living within your means and consistently saving and investing, you’ll position yourself to enjoy a comfortable and fulfilling life in your later years, free from financial stress and uncertainty.Top of Form
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Sometimes it is good to find older people that have built financial wealth and ask them about the early days, the middle of their building process and let them tell you what they have now. It is a process and anyone can do it, you have to have the right strategy and motivation.
If you have any other methods you recommend to delay financial gratification, I would love to hear them from you, and to pass them on to others who are making strides in this area of life. It is worth it, one million times over. Feel free to email me anytime.
Warmly,
Steve Pybrum
(805) 962-1040
Canberra Company
