Focus on Saving, not Spending

What do you do when you know you’re gonna get a bonus?

If you’re like most people, you probably are thinking, “What will I spend that extra money on?” You probably think, “I worked hard for this bonus, I deserve to treat myself.”

If we want to get ahead in our debt, we need to change our thinking. If we want to be rich and have money in the bank, we have to think and act as if we do. (hehe) We have to think like a millionaire, we have to focus on saving our money and not spending our money. We have to learn how to invest the money and not incur more debt. Let our money work for us, not us working for money, right?

How? (Good question!)

Before you even think about spending that bonus, assess your finances. Do you have lots of debt? Do you have a bit of savings so now you can invest? How can you invest in your future? your kids’ future?

My dad immigrated from another country. He had nothing in his pocket, literally owned nothing. Growing up he had to work for his day’s meal. He tells me this story of how he got handed down some shoes, shoes with no soles! He needed them and used them! Today, 50 years later, he owns 3 homes and living in a million dollar home. He gets 2 monthly retirement checks. He spends all day long in his garden and takes care of his grandkids (by choice).  He lives life simply.  My mom took an early retirement to get a good severance package and has never worked since, she was only 45 years old. What a nice life, huh?

They budgeted. They sacrificed. I can say that we never did vacations much. Our big day was a trip to Disneyland, nothing big. I can’t really say I have any memories of vacationing. But you know what? (what?) I never felt like we were poor, I never thought that we were different because we didn’t take vacations. I never  felt like I was missing out. These days we think we deserve a vacation, we think we need to go somewhere to relax, to see places. (Why?) My parents never went out to eat, my mom knew the true value of a buck. In the last few years, my parents now have taken cruises, have visited their country and spend time with friends in different parts of the world. They have the money to do it. They don’t have to save for them. They don’t have to charge their trips, they have it.

If they finished paying off a bill, they would keep putting that bill money away and pretend it wasn’t there. They didn’t buy something they couldn’t afford. I remember seeing an old calender where they would write down every expense for each day. One day I saw, “Larry’s milk money 5cents”. They budgeted every penny, literally!

My dad would buy a home. He would keep paying on it. He would move when the real estate market was good. He would keep the old house and rent it out for a good deal. He could do that because he didn’t borrow against the home, the mortgage stayed the same while the value of the home increased.

At the same time, he would invest in little stocks and watch it grow. He would buy everything with cash and if he had to charge it, he would pay off the bill at the end of the month. He rarely got himself in the position where he owed anyone. He planned for us kids to go to college without getting himself in debt, or us. I never had to take out a student loan. I hear stories of people paying back student loans.

He budgeted the finances so meticulously that he’s at a point where he can buy anything he wants.  The beauty of it is, he doesn’t. He enjoys what he has today and doesn’t look outside of his box for the next object to own, the next buck to spend. In the same breath, he does have nice things and has the option to purchase, if he wants.

That’s where I want to be.