As we all know there are principles of leadership, principles of morality and honesty. There are principles of negotiation and warfare. And there are money management principles as well. Principles are laws — absolutes you can count on forever.
For example, let’s take the laws of nature. You can count on the sun coming up tomorrow morning. Or, when you get out of bed in the morning and step down, you would never think your foot would be attracted to the side wall like a magnet! That is because the law of gravity is at work. We plan on these laws to never fail us, and they don’t.
As Steven Covey noted in his book, “The 7 Habits of Highly Effective People:”
“Principles are like lighthouses. They are natural laws that cannot be broken. As Cecil B. deMille observed of the principles contained in his monumental movie, ‘The Ten Commandments,’ ‘It is impossible for us to break the law. We can only break ourselves against the law.’ … The degree to which people in a society recognize and live in harmony with [principles] moves them toward either survival and stability or disintegration and destruction.”
Principles are absolute, they will never change, they don’t rust, or go
away. Principles will never hurt you. You can count on principles.
Over the next ten posts, I will introduce you to the 10 money management principles that will guide you financially for the rest of your life. Please read through them and ask yourself how you are doing with each one of them. As you self-examine using these absolute principles, you will begin to see the wisdom in learning and living them.
The principles I will be discussing have to do with 1) learning to control spending, 2) elimination all debt, 3) ethically and legally reduce taxes, and 4) maximize retirement. To get into the principles fully I urge you to learn all about yourself and how you think about money, first — what is your “financial personality?”
Here are 10 questions to assess how well you are doing with your personal finances. Take this assessment every 6 months and watch your improvement:
- How often do you argue with your companion about finances?
- How often do you worry about having adequate money for your needs.
- Do you have a monthly spending plan where you track how much you spend, save, and earn.
- How much of your gross income are you saving monthly?
- Are you adequately prepared for the future with at least 3 months emergency savings and adequate insurance?
- What percentage of your income goes toward paying debt?
- Do you know the rules of the financial games you are playing including credit cards, mortgage, insurance contracts, etc.
- Do you have a plan for retirement?
- Do you understand how taxes can affect your finances and do you keep good tax records?
- Do you know what you are worth financially?
As I bring you the 10 Money Mastery Principles, read them and practice implementing them. As you do, it will only be a matter of time until you come out on top. Your spending will be easy and there will be no need to argue or complain about not having enough money. Quickly, in one month, you will have a Get-Out-of-Debt plan and know precisely when you will be out of debt. If you follow the principles, it is possible for anyone to be out of debt, including a mortgage in 10 years or less. Plus, while you are getting out of debt quickly you will also be able to create a solid retirement plan, and begin permanently saving for the long-term.
Learn these principles, live them, and it is absolute that you will be in total control of your financial future very soon. Watch for my posts and learn more about them at www.moneymastery.com.