I was talking to one of my kids this week about success. Two of my favorite quotes are:
- · The only place success comes before work is in the dictionary.
- · “Give me six hours to chop down a tree and I will spend the first four sharpening the axe.” – Abraham Lincoln
Preparing to succeed is paramount to success. Too often I see people who know what they need to do to be financially prepared for retirement and beyond, but they have a hard time following through.
I believe there are three ways, which are all good alone but are not mutually exclusive, to have a lifetime of financial success:
- Save more
- Spend less
- Invest wisely
Number one and number two seem to go together, but if you are already in retirement, saving more usually isn’t an option. But spending less is important for all of us, particularly those without income; spending too much principal annually is a recipe for failure. For those that are still working, though, these two should go hand-in-hand. And, in some ways, saving more can directly contribute to spending less: for example, if you have enough savings, you become self-insured and can reduce, or eliminate, some of your insurance.
Number three, invest wisely, doesn’t necessarily mean just financial investing. It also means proper planning, tax-advantaged spending, as well as investing in yourself, your family, and your community. Studies show that people who have intrinsic goals (such as quality relationships, community involvement, and self-enrichment) rather than extrinsic goals (like wealth, fame, and good looks) are happier. Happiness breeds success in other areas, and also is a significant contributor to a long life!
So my charge to you today is to think about those areas that you can improve. And remember: the only thing worse than dying is outliving your money!