Everyone knew that kid at primary school. Teachers pet they called him. He was always attentive in class, got good marks, and aced all your class tests. Back then he was called a nerd and made fun of, but now he probably works for Google owns a yacht.
But, did you ever notice that the ‘teacher’s pet’ always seemed to have extra money for the tuckshop at school? He always seemed to have enough for a few red frogs and even flavoured milk on sports day. So what does being the teacher’s pet have to do with having more money?
Perhaps more than you might think.
I’ve noticed in recent times that the people that work hardest to build their knowledge around money seem to be the most financially successful.
This is no coincidence.
When you don’t know the rules of the game, the options you have available, and their impact, it can be hard to take the steps you need to follow to grow your savings, investments, and wealth (or just fund your next travel adventure). You end up confused, overwhelmed with information, and worried about making mistakes that will hold you back.
All this leads to inaction, missed opportunities, and inertia – one of my pet hates.
If you take the time to understand your options and the impact of the decisions you’re considering and your path will become clear. You’ll know exactly what you need to do to get what you want, and the complex will become simple. You’ll be able to act confidently and decisively. You’ll be set to start making smart money decisions sooner.
But, so many of young professionals keep making a critical error that reduces their confidence and holds them back. If you try to cut corners in this one area, your progress will be held back, and you won’t be confident in the decisions you’re taking. Trying to take shortcuts here can also mean you make mistakes and run into trouble. So what is it?
I’ve been helping a client for the last little while that made this same mistake, will call him Pete. Pete was a senior manager at a technology company making a good income, and had built up a pretty solid investment portfolio. Pete wanted to buy property as an investment as he saw this as a good way to grow his investments over time.
But Pete didn’t know much about property. He didn’t know how he should buy property. He wasn’t sure how much he should spend. He didn’t know how to set up a good borrowing strategy. Pete didn’t know how to structure his purchase.
Pete was worried about making a mistake when he bought property or making a decision that would impact his lifestyle and mean he’d have to make sacrifices.
I helped Pete understand all the issues he needed to be across to get his property strategy right. We covered how to choose a good property, how this would impact his tax, how much to spend, how to get a good debt strategy in place, and how to manage lifestyle risk and financial risk.
Once Pete knew the rules of the game I helped him build a property plan to build his assets while at the same time ensure this investment wouldn’t hold Pete back from living the lifestyle he wanted or facing more risk than he was comfortable with.
Pete has just settled on his first property and is now another big step toward setting himself up for the future.
Pete’s happy. Property in place. Less tax. Holiday budget survived. Cashflow still strong. Happy days, right? All this was great, but there was still one thing I wasn’t happy with.
When I looked at the numbers, we figured out Pete could have actually purchased his property much sooner. If he did, he would be even further along his journey to setting up his ideal lifestyle.
So what held him back?
The main thing that was holding Pete back? Not having the knowledge he needed to confidently make the decision to buy property at the right time. Once Pete had taken the time to educate himself on the issues and choose the right mix of variables to build a great property plan for him.
Once we had the strategy set Pete was ready, willing, and able to jump into the market. Pete also told me that he was completely confident in what he was doing and when he bought he didn’t have any second thoughts.
I think everyone should be in this sort of position when they make such a big decision.
Understanding money and working to educate yourself about your options is the one sure fire way to give yourself the confidence you need to take the action you should to make smart money decisions. When you take the time to educate yourself, build on your financial knowledge, and understand the most important issues when setting up your money strategy, you’ll get some pretty awesome benefits.
Take the time to get be clear on what’s possible so you can position yourself to take advantage of the opportunities available. Do this and you’ll understand the impact of what you’re doing and can assess with open eyes whether you’re comfortable with the implications of the actions you’re taking. You’ll also understand and be able to manage the risk you’re facing.
This will give you a much better chance of success with your strategy. You’ll also be positioned to confidently and decisively act to get the outcomes you want for your money and lifestyle.
This often means making smart decisions and being ready to take the action you should sooner.
Get skooled.
