Financially Succeed like a Mainer
Many people might be surprised how many of their neighbors are financially successful. They don’t look well off. They don’t have really nice cars or nice things. But, I can tell you, I have seen quite a few financially successful individuals in my office. (And outside of Maine!) What makes them different? And what do I consider as successful?
I consider success to be someone financially independent. It does not mean you have to have millions of dollars, though some do. What it means is that you have enough assets/passive income to make work optional, or at the least have resources to be able to dictate when and what kind of work you want to do. For some younger clients, it might mean leaving a regular job behind much earlier than a typical retirement age.
Here are some of the habits my most successful clients have:
· They typically live below their means.
· They invested early and often. Their investments over long term periods are not conservative. They usually take some risk.
· They usually drive their cars for a very long time or until “they die”.
· They understand their spending and prepare for big ticket items like vacations.
· They do not carry credit card balances.
· They usually own their own homes and pay them off quickly. They don’t like debt.
· They are healthy! They usually spend the money to eat well and take care of their health.
· If they receive inconsistent income (sales commissions, bonuses), they live off their regular income and save the irregular income.
· They are not “penny wise, pound foolish”. They recognize when they need to invest in financial planning, receive tax advice from a CPA, or consult an estate attorney. They understand that purchasing affordable insurance, like life insurance or full coverage car insurance, to minimize financial risk can make sense.
· Lastly, they spend their money on appreciating assets and avoid depreciating assets like motor homes, nice cars, boats, motorcycles, etc. If there is something they really want for fun, they usually spend much less than they can afford and buy used.
However you define financial success, it is possible to achieve it with careful planning and financially healthy habits!
For more information, these are some of my favorite resources:
Millionaire Next Door. Yes, this book is dated, but the concepts are not!
Total Money Makeover. Great read to get out of debt.