The State of Your Personal Finance Reflects Who You Are

The current situation of your personal finance can help you realize where you are at a certain point in your life and what you can do to steer it in the right direction. Let’s take a closer look at this and comb through the results we get.

If you are currently in debt, there is a good chance that you are living above your means and spending more than you earn. In other words, you spend money which you have not accumulated yet. I agree that some debts are slightly less bad than others: your home, your student loans, investment… But again, if you got to a stage where you think debts are normal, you probably would not have tasted the concept of living a life free of debt for a long time. To live below your means implies saving before buying anything and finding creative and intelligent ways to raise money faster.

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If you have money accumulated in savings, bravo: there is a good chance that you have understood the importance of paying yourself first at some point in your life, but above all, it means that you have a strategy in place, possibly even automated to put money aside systematically in various locations (savings, stocks (it helps to follow stock exchange news etc.

The future version of yourself is not unknown to you. Remember this when you put money aside: this is for you, the same person reading this article right now. I’ve seen people not put money aside because they were suffering from perfectionism. In fact, they wanted the best savings account at all costs, and given that it is a complex task, they pushed it to tomorrow. Others simply do not save because they are stubbornly “waiting” for the day when they will have more allowance to do it. Unfortunately, the right day often comes too late (or never) for most of them.

If you have investments, there is a good chance that you have understood how important it is to start investing early. Indeed, you have taken action (congratulations) towards enjoying the many years ahead and which will help your investments grow.

If you live from paycheck to paycheck, it is likely that you do not have a savings account that is regularly updated or an emergency fund to take you through a storm, like a job loss. It is also possible that you probably are spending far too much money for what you do. Take a moment: how much money do you put a month in repayment of your debts? Add the amounts. Do you know the exact number?

Looking at the sum total above, does the figure represent a significant percentage your income? Also, if you live from paycheck to paycheck, it is highly likely that your salary is not as high and representative of your true potential as it ought to be. Improve and increase the value you bring to the market, and the number of people you can affect positively with it; and you will see your income rise significantly.

If your salary does not suit you, stop blaming external factors and instead turn the mirror toward yourself.

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