By William Ballard
It is important to know/understand that I was not born into wealth. Like you, I have worked my butt off -- my whole adult life -- to create wealth and success for myself.
As I have said many times before, I do not ever blame someone or fault them for being poor. However, I DO NOT tolerate remaining in the thought-process and/or belief that being poor is a permanent condition or something that cannot be changed.
I have dedicated part of my life to helping people increase their income and move into financial freedom. With that said, I've heard or encountered just about every situation or circumstance that has kept people struggling financially, such as being handicapped, being addicted to drugs, or drowning in debt.
I have heard just about every scenario and have even experienced some of these in my own personal financial life, but hear this: There is NOTHING so bad that you cannot find away out and experience financial freedom for yourself. This belief is what is keeping you under lock and key and blocking you away from the abundance you deserve.
You see, the reason most people struggle financially is because they've been educated ALL wrong on the topic of money. Before we move into these top 8 money mistakes, I want to show you how in many ways you have been taught a wrong money mindset. You've probably heard most of these since you were a child. Read through these and think about how much misinformation you've take in over the years.
Poor & Middle Class Money Lies and Financial Limiting Beliefs
"A penny saved is a penny earned"
"Finances are complicated."
"A house is an asset."
"Diversify your investments."
"Money doesn't grow on trees."
"Money won't make you happy."
"Invest in a 401 (k)."
"Save for a rainy day."
"Not everyone can be rich."
"All debt is bad debt."
"Don't put all your eggs in one basket."
"Rich people are greedy."
"It takes money to make money."
"More money equals more problems."
Now, with all of those financial lies and misinformation in mind, lets get to the first top money mistake that most average Americans are practicing on a day-to-day (and even annual) basis.
Money Mistake #1: Saving For a Rainy Day
If you are like me, you've probably heard your entire life that you should save your money. However, the problem with this is that the same people that told you that never told you why, or how it aids in helping you create wealth.
I'll be completely honest with you, it is absolutely impossible to create wealth just by saving alone. In fact, you can't find any of the so-called 1% who will tell you that they got wealthy by saving their money or becoming bargain hunters, or coupon collectors. Look, the 1% didn't reach the financial level that they are at by playing with their money that way.
You see, your parents -- like mine -- only had it half right. In fact, I will tell you why they were so adamant about telling you to save your money.
The reason is because, back then, or even as far back to their parents -- who taught them the same thing -- was that banks were offering extended high interest returns on any money that was saved in their accounts.
In other words, if you were to put, say... $10,000 in a savings account 30 to 40 years ago, chances are you would have probably been able to get close to 10% on your investment. Meaning, if you saved $10,000, and were earning 10% on interest, you would be able to earn $100 a month on your investment.
And, of course, if you saved more, you could earn more in interest. However, it doesn't work that way anymore. The truth is: Right now, the interest rates are at an all time low, and barely even come close to 1%. In fact, in most cases, if you were to put money in a saving account today, you might earn .25%.
You want to know what .25% is? That is 40 years of your life gone just to earn 10% (a $100 dollars). The fact of matter is this: The banks don't pay anything in return today. And as I've mentioned in last weeks article, money that just sits around gets wasted.
In fact, if your money was to sit in a bank (or in a shoe box in your house)... it's amazing how it works, but... The truth is: That money is always going to be able to find an "emergency" to go fund.
"Do not carry cash or credit cards, because when either is available, you'll create a reason to use it." - Dave Ramsey
You see, if you were like me, and raised by poor or middle class parents, we have all been conditioned the same way. We have all been programmed to believe that if we get more money in, more must goes out. In other words, if you get a pay increase at your job, your spending habits increase with it.
That is why back in 2009 I opened a sacred savings account where I parked my money -- or how Grant Cardone states it in his Millionaire Booklet (AFF), "Stayed Broke" -- so I couldn't touch it.
Let me ask you this: How many old people do you know, 90 years are so, who have a million dollars that they have never taken the time to enjoy? They never went all-in enough to let their money grow into wealth to the point where they felt they could finally retire and really live life financially free.
Look, there was one reason to save back in the day, and that was because banks were giving out high interest rates to their customers/clients. However, those days are long gone, and the only reason to save now is so that one day you can invest it in something big.
"Never save to save, save with the purpose of making a big play one day!"
- Grant Cardone
Money Mistake #2: The Poor Spender Who Thinks He's Rich
Have you ever met that person who is always trying to impress everyone by showing off their new ride, their new fancy watch, or is always trying to pick up the dinner bill?
In fact, what about those people that lease an expensive car that they know they can't afford such as an Cadillac Escalade, or something in that ballpark, but then end up missing payments and blowing their top when the repo-man comes to collect.
I'll be honest with you, true wealth doesn't role that way. In fact, take Warren Buffet (one of the richest men to ever live) for example. He lived in the same $120,000 dollar home for his entire life -- not many know that.
He could have bought several homes but he didn't see the need in more than one, and he certainly didn't need to buy more homes in order to receive validation from the public. He knew he was rich, he didn't need anyone else to tell him so.
You see, he wasn't trying to flash his wealth by buying an over sized mansion that he didn't really need. He didn't need to do these types of things to validate himself on how rich he was. If he wanted to do that all he had to do was look at his bank balance.
The truth is: A "real balla" is not trying to impress people with expensive cars, fancy watches, or VIP tables. In fact, real wealthy people are not in the business of trying to impress people they do not know.
You see, their key focus is not on needing people to validate them, they are more interested in living a life of freedom -- free from the need of validation from others.
The true wealthy are not trying to say, "Hey look at me and what I got." However, when the true wealthy (not those that are poor who think they are rich) spend their money on stupid things like cars, yachts, mansions, etc. the truth is: No matter what ridiculous investments they make, they can afford to do so because they are financially free.
In fact, that is what it means to be wealthy -- to be able to spend money like it doesn't matter.
The "fake balla," on the other hand, is the poor or middle class guy (or gal) who is pretending to be wealthy when they know they are not -- living beyond their means.
How do you know when you are no longer pretending? When you are able to purchase a plane and still have enough left over to purchase the whole airline.
You see, what most people see is the wealthy display of extravagance from the rich, but what they don't see is the discipline these people had to practice back in the day in order to be able to make wise investments, and create the financial freedom they have today.
In other words, the money these guys (and gals) are spending today is tiny in comparison to the abundance of wealth they have created over the years. And what you have to understand is that money is nothing more than a resource that allows you to become mobile, agile, and provides you with more and more options and choices.
Money Mistake #3: Playing The Nonsense Comparison Game
Now when it comes to the "comparing to others" mistake, this point is really twofold. You see, on one side of the coin you have those that are always trying to compete with the "Jones's" and then you have those that always want to compare their shortcomings to the shortcomings of others and turn around and say, "Well, that person has it worse than I do. So my situation isn't so bad." Both sides are incorrect. We should never compare ourselves to others.
Look, we have all heard the saying that "The grass is greener on the other side", however. What people fail to yell you is that no matter what side you are on, the grass still needs to be mowed and treated with care.
I mean, think about it... the reason the guy next door has such nice looking grass is because he has taken care of it. If the two of you were to switch houses, guess what... the grass on the other side, that you were so jealous of, which you have failed to maintain and take care of, will eventually start looking like the grass or yard you just left.
But the guy who knows how to take care of his lawn, well... The unkept yard that you just left will then become the new "greener grass." You see, the problem is not the grass or the home or the person next door, the problem is (you) the one that has been given the responsibility of managing the yard you have been given, but have failed to do so.
And the thing is: If you really wanted to have green grass, but just didn't know how to accomplish such a goal... well, guess what... You may not want to believe this or not, but the truth is: If you were to walk across the street and ask the guy at the house next door what his secret was, chances are, he would tell you. In other words, believe it or not, but most people are willing to help if you were to give them a chance to do so.
Now, what about the other side of the coin?
Where being jealous and comparing yourself to the successes of others is one thing, the other common problem with comparing yourself to others is thinking to yourself that you are better off than someone else.
"I know people in the U.S. who compare themselves to people in 3rd World Countries. Never ever compare yourself to someone else's financial condition." - Grant Cardone
I will admit it, there will always be someone worse off or better off than you. You are certainly better off than the homeless person down the street, but your are certainly worse off than Warren Buffet.
Look, your level of income and financial situation has nothing to do with mine, and mine has nothing to do with yours.
I mean, think about it like this: If you are comparing yourself to the homeless person down the street, and trying to tell yourself that you are better off, how does that way of thinking help you pay your bills or put food on your table? How does that way of thinking feed your children or take care of your parents?
Look, be real with yourself! The reason you are telling yourself, "but we are so much better off than..." is because you are trying to convince yourself of a false sense of security.
"Never compare yourself to another; it doesn't solve your problems."
- Grant Cardone
Money Mistake #4: Getting Pulled Under The Trends Current
According to Dictionary.com, a trend is defined as a general course of direction, or a drift.
You should never put all your hard assets into a trend because trends are fleeting. They are here one moment and gone the next. No, I would much rather focus on what I can control.
Yes, it's true, you may find me reading and studying heavily on the latest trends and happenings that are going on in my space or in the industries that my clients are a part of, but just because I may look at them doesn't mean I jump on them when they fly by.
Now, sure, it is also true that, by playing the field like this, I may miss some huge investing opportunities -- and I am sure I've missed many -- but while I may have missed a trend (which is like a current in a river and can oftentimes carry you away into danger or pull you down under), I was able to firmly grab an industry.
Look, don't be seduced into the latest greatest shiny new widget that comes today but will be gone tomorrow. Don't get caught on the roller-coaster ride of maybes, or caught in the canoe without a paddle being pulled down by the current that is sure to take your under.
In short, seek situations and opportunities that can guarantee the accumulation of wealth. Some might tell you that there is no such thing as guarantees, but the only ones that tell you that are the ones looking in the direction of trends rather than in the direction of wealth generating opportunities.
"Where there is uncertainty, there will be losses." - Grant Cardone
In conclusion, by now you should be gradually understanding how important it is for your take back CONTROL of your personal finances. These are just four of the top 8 money mistakes that most average Americans are committing day-in and day-out.
Next week we will cover the next four money mistakes in this two-part series. With that said, you definitely don't want to miss that next article. Subscribe to our newsletter below so that you don't miss out -- trust me, you'll be glad your did!
Until next time, make your way down to the comment section below and share your thoughts. Then I want you to do me HUGE favor and share this article with as many people as you can -- let's make this GO VIRAL!
William Ballard is an entrepreneur, international best-selling author, speaker, thought leader, and direct-response marketing expert. He is a highly respected and sought after master copywriter whose passion is to help local churches (ministries) and entrepreneurs get more for their hard work regardless of economic climate. His books, audio packages, membership programs, and seminars provide readers, just like you, with the practical tools necessary to finally answer the call to ministry or to launch their very own businesses and help propel them towards their path to true financial freedom.