One of the most critical insights to create a financially free life you love is to spend less
A few years ago I attended a top producer meeting at one of the nicest hotels in Boston, Massachusetts. Everything about the experience, from the service to the decorations, was impeccable! While I have been blessed to stay at some of the finest hotels throughout the world, this hotel made my A-list. And the food was also unbelievable.
After a night out with the group who qualified for the trip, I returned to find my linens turned down, and a piece of Godiva® chocolate with a “Life Secret” message on my pillow.
The message said, “To live a happy life, spend less.” I had to laugh.
The cost per night for this room was more than most peoples’ mortgage payment! Even though I wasn’t paying for my room, I was sure many of the guests were. I wondered what the reaction other guests’ were when they read the “Spend Less” message. While I agreed with the message and know firsthand that “Spending Less” is an important secret to financial freedom, I was also blown away that a hotel of this caliber would share such a message. I couldn’t help but wonder if the person providing the “Life Secrets” messages to their guests had read them.
Not only is the “Spend Less” advice important to live a happy life, it is also a critical millionaire insider secret to create a financially free life you love. In order to “Spend Less” you first need to figure out what you are spending your money on.
A few years ago, a local television station selected me as the expert to assist two households near financial ruin. One household was a family and the other was a single woman living alone. In both cases, the primary problem was that the households needed to spend less. While both households thought they needed to earn more income, neither had any idea which expenses were necessities (needs) and which were desires (wants).
Purchases that are necessities may include – your mortgage, utilities, gas, food, etc.
Purchases fueled by desires are items such as – a big screen television, fancy rims for a car, exciting vacations, etc.
One insight to “spending less” is to remember that we do not need to own more stuff in order to have an amazing life. A new purse or suit is not the secret to happiness. You may be saying, “what?” Most of the things people want is because of their belief of how they will feel once they get it. Often, it is an emotion such as happiness or peace of mind, i.e. if you had more income, you would be happier or if you had less debt, you would have more peace of mind. But the reality is that this is simply a belief-not reality. The reality is that you can be happy in your current home or without that fancy purse. While the initial dopamine rush will give you a short term high, the long term ramifications of over spending and not saving can result in depression, anger, and worry (do you really believe people’s retirement goal is to be a Walmart greeter?)
Early in my career a mentor shared, “People who shop in the malls have holes in their souls.” Her meaning was that when a person needs to buy things to be happy they are covering up a void in their life, something that is missing and that they are trying to fill, similar to drugs and excess consumption of alcohol. While taking a trip or buying a new suit may make us feel good for a brief period of time, the long term effect wreaks havoc on our quest for financial freedom.
Make a list of your monthly expenses, one item at a time. Once your list is complete, review each item individually. Are you spending more money on necessities or desires? Perhaps you need to re-evaluate your spending habits so you are “Spending Less”!