I once read the book “our fallible thinking” by Daniel Kahneman and key takeout: we think we make conscious choices and are in control of ourselves, is often not so. You too are occasionally fooled ad nauseam by your own brain. And that means that sometimes (often) you don’t do the right things to realize your oh-so-desired life. Doesn’t matter, is very human. If we all outsmarted ourselves, we would all be rich, healthy and trained. In terms of finances, that’s totally shit, because you want to live your best possible life both NOW, and tomorrow (and every day after tomorrow). Hopefully I can help you gain some insight into yourself and thereby help you to, yes, help yourself. How to get good with money is the question we are going to answer!
Biggest obstacle is our brain
When it comes to money, our biggest obstacles are our own brains and our own limiting thoughts about money.
Deeply rooted within us are beliefs, often inherited from your upbringing, that determine how you now view money and how you organize your daily life financially.
There is so much information available, so much knowledge and so many experts. So why does it still happen to the majority of people that instead of controlling money, money controls them? For many, the routine goes like this day in and day out: work, make money, spend money, spend money, work.
If your work involves trading your time for money, you are trading something that can never be made up, for something that you can make work for you, but are not doing right now.
Read that sentence again. As long as your money controls you, rather than the other way around, you will continue to exchange your very scarce time, attention, focus and energy. We are going to do this smarter!
A time that does not exist
What stops us from doing the choices that are right for us? Why aren’t we masters of our own brains and thus our own actions? The problem here is that when you make choices and take actions now for a goal in the future, it makes you feel like you are losing something in the present. And we humans don’t like to lose. Wanting to do something for our future selves is difficult because our future selves do not exist. There is now, the present. And if we have to give up something in the NOW, in the HOURS, for the FUTURE, a time that does not exist, then we are in trouble.
Direct effects
If you lit up a cigarette now and immediately had a lung tumor, you would leave it.
Now if you order and eat a tasty menu at the McDo and immediately have a heart attack, you won’t be nibbling away at another burger anytime soon.
If you started exercising for an hour right now and immediately had a visible six pack, you would start right away.
If you set aside 10% of your monthly income now and immediately earned so much from it that you could quit your job tomorrow, you would be off the hook to set aside that 10%.
But these are all
long-term efforts
. You do not feel, notice or see immediate results from these actions. You won’t notice and feel that for 1, 5, 10, 20, 30 years.
But no menu at the McDo now means no eating a nice burger now.
Now not setting aside 10% but being able to spend it on a new dress now means a short shot of happiness.
Exercising for an hour now does not mean hanging out on the couch for an hour and relaxing.
In short, you give up pleasure in the NOW, for something that does not yet exist: the future.
And it’s not at all crazy to be tempted to choose that which makes you feel good NOW. This is how we humans are programmed; this is how our brains work. But fortunately, we are also smart and can realize this, become aware of our behavior and change it.
How do you get good with money?
When it comes to finances, there is something else that plays into our hands. Namely: that we think it’s too complex. That we will never get rich anyway. Or will make a lot of money. Or that money is for stingy people. And besides, we don’t think money makes us happy.
In addition, we think the topic is too big. That it is impossible. That this (money, investing, investing) is a field that only pros know about. The financial system is also complicated. Just like the medical profession. Actually any other world you know nothing about. Because what you don’t know, you don’t know, and is therefore by definition incomprehensible. But surely we are not going to let it stop us, are we? Because we too can get good with money. And to own something, to make something completely our own, three stages are important:
1. Cognitive understanding
The ability to understand a topic and concept. This means: reading, listening, watching. Read books, blogs, analyze the behavior of people you value and listen to inspirational podcasts.
2. Emotional control
The more often you delve into knowledge around you to achieve the goal you want to achieve, the more feelings are stimulated. If you do a lot of watching, reading and listening to people who have achieved what you also want to achieve, this evokes feelings of desire, enthusiasm, purpose, but also fear and insecurities. In short, you are fanning a fire. And this is necessary to get that fire burning.
3. Physical control
Eventually you will have to turn steps 1 and 2 into action. Not once, not twice, no: repeatedly. Repetition is the mother of skill. To really master a subject, you have to roll up your sleeves. Do, do, do. So don’t sit around endlessly waiting and hoping for a sign, get going. Start small and get it done.
The best time to start? Now!
So, start today. No: now. Start putting money aside. And whether that’s 1% or 10%: I’m sure you can put something aside. Be honest and find out if you are secretly fooling yourself, because the chances are very high. Save on small amounts. Spending 5 euros too much every day on fussy things is 1825 euros on an annual basis.
Read how you can save smart in THIS article.
Open a new savings account that you can’t access so you don’t start shuffling money around.
Join the Elfin and surround yourself with thousands of other women who are also in the process of becoming financially independent.
And realize that you won’t get everything right right away. Give yourself time and space. Because behavior patterns that have been built up for years do not break you after reading 1 good book or performing 1 good action.
Before your money literally starts working for you, you’re years away. But to sit comfortably in the shade a few years from now, you need to start planting your money tree NOW. And all beginnings begin with mastering and controlling your own beliefs, thoughts and actions.
