The successful understand that true financial freedom is achieved by building or accumulating money producing assets. These assets include:
- Investment real estate
- Stocks and bonds
- Intellectual property that you’ve created
- Your side hustles
- Your small business
- A franchise business
Ask any millionaire and they’ve likely built their wealth utilizing one or more of these assets. If this is such a tried and true path to wealth, how come most of us haven’t taken it?
1. We’re stuck in comfort zones of misery.
Who among us has not remained in a bad situation we knew we should have gotten out of, but didn’t. Maybe it was a job that made you absolutely miserable or an abusive or unfulfilling relationship. While the situation might have been terrible, the pain was not severe enough for you to make a change, so you went on with your situation comfortably miserable.
That’s often the way our financial lives work. We hate not feeling secure, worry about the future, or feel that there is never enough, but too often we’ve become comfortable with our financial discontent. The pain is not sufficient enough to make the necessary changes. Instead, we complain loudly but do nothing.
To help break the pattern, focus on your “why.” Why is financial freedom important to you? Perhaps you desire a stable financial future for your children. Maybe you’d like to be in a position to give freely to your Church or favorite organization. Whatever it is, your “why” will provide you with the driving incentive to improve your financial situation.
2. We don’t believe we can do it.
“If you think you can do it, or you think you can’t do it, You are right.” – Henry Ford
Real estate investor. That’s what other people do.
Entrepreneur. Not me.
Investing in stocks. That’s a sucker’s bet.
These are beliefs many of us subconsciously absorbed growing up. Entrepreneurship, real estate investing or purchasing mutual funds were things other people did. Instead, we were told that if we studied or worked hard we’d eventually land a well-paying job, our ticket to financial freedom.
As a result, it’s hard for us to see ourselves doing anything other than our 9 to 5. Change your mindset, however, and you’ll change the size of your bank account. Whatever you believe, you achieve. Believe you’re capable of starting your own business or investing in real estate and you’ll accomplish it.
If you’re having trouble changing your mindset, start hanging around people who are doing what you’d like to do. Join forums, online meet-ups or real world clubs and organizations. Even consider befriending possible mentors in your area of interest. Find a local real estate investor who might be willing to take you underneath their wing or local entrepreneur who might be willing to explain their business to you.
3. We’re afraid to take risks.
You’d like to step out of your comfort zone, take the leap and create money producing assets that’ll power you toward real financial freedom, but you’re afraid. It’s natural to feel this way. What if I start my side hustle and fail? What if the stock market crashes?
Unfortunately, if you never take risks you’ll never reap the rewards. Even doing nothing is a risk in and of itself. But here is the reassuring thing; risk can be diminished with knowledge. The more you know about your endeavor the less risky it will be.
If you, for instance, understand that low-cost index funds are one of the safest and best returning investments over the long haul, you’ll be less likely to chase the “latest and greatest” stock idea. If you understand the importance of cash flow when evaluating rental property you’ll avoid bad deals and secure a profitable income producing property.
Your success is dependent on the education you give yourself. Are you willing to read ten or more books on real estate investing? Are you willing to listen to investing podcasts during your commute to work? Would you even be willing to take a class or two on starting your own business at the local community college? Those that invest in their self-education reduce their risks and reap the financial rewards.
4. We tell ourselves we don’t have the time.
It’s easy to convince yourself that you don’t have time to pursue money producing assets. Between work, family and everything else in life, it seems like we hardly have time to breath. But consider that, according to Nielsens, the average American spends more than five hours a day watching television. That’s more than 77 days per year.
It’s simply a matter of choice. We have the time. It’s how we use it that counts. Building your side-hustle, learning to invest in mutual funds, or starting your real-estate investing career will bring far greater dividends than watching Empire or wasting time on Facebook.
Reaching beyond your comfort zone to achieve financial success is never easy. But, as financial guru Dave Ramsey suggests, if you’re willing to live today like no one else, you’ll have the financial ability to live tomorrow like no one else. The choice is yours.
BMWK, Are you ready to overcome your wealth building roadblocks?