Sunday, October 01, 2006

Personal Finance Success Insights

I have been very impressed by the sincerity, knowledge, and quality of advice from people who write and comment in finance blogs. These people are genuinely interested in improving their financial situation and are taking action to do so.

Here are some of my insights from reading various blogs over the past month:

Personal financial success is a journey. There are no short cuts, silver bullets or get rich schemes that are sustainable. Success stories show that typically 2-3 years of hard work are needed to achieve a major financial goal, such as completely eliminating debt.

Know your specific destination. If you don’t know where you’re going, it’s hard to know when you’re there. Set goals that are measurable. Many goals set by bloggers include amounts and timing, e.g. net worth of $4,000,000 by 50, zero debt by March, 2008. This is more effective than a goal of “being rich.” Concrete goals will enable one to easily track progress.

Success has many paths. There are some approaches that work for everybody, e.g. spending less than one earns to build wealth. There are many approaches that work for others and won’t work for me, e.g. developing a computer model to achieve higher returns in stock market or keeping a detailed budget. There are also approaches that don’t work, e.g. investments strategies that “guarantee” success. One has to be able to knowledgeably sort out when a path is working and when one is not.

Enjoy the journey. It will be take sacrifice and hard work to achieve financial success. To use a sports metaphor, “no pain, no gain.” At the same time, extreme sacrifice and extreme pain will prevent achieving one’s goals. Wealth building is a lifestyle choice. Make sure one’s choice is a lifestyle one can sustain.

This is not financial advice. Please consult a professional advisor.

Copyright © 2006 Achievement Catalyst, LLC

1 comment:

Anonymous said...

Could not agree more. I have always followed the four point you mentioned here but never articulated them.