Personal Finances: The Top 8 Money Mistakes (Part 2 of 2)

"Anybody that isn't willing to back up what they say with proof -- put their money where they mouth is, so to speak -- isn't worth getting involved with" -- Grant Cardone

Photo Credit: www.kiplinger.com

By William Ballard

Last week I introduced the first four of the eight major money mistakes that the average American commits on a day to day basis. As a recap, those first four are:

1) Saving for a "Rainy Day" 
2) The Poor Spender Who Thinks He's Rich
3) Playing The Nonsense Comparison Game 
4) Getting Pulled Under The Trends Current

If you haven't read that first article in this series, then I suggest you do so by going HERE before reading further.  If you have read that article, then you are really in for a treat this week. So, without further ado, let's get right into it.

Money Mistake #5: Taking Everyone and Everything
at Face-Value

This next mistake can apply to just about any area of life. You see, anybody that isn't willing to back up what they say with proof -- put their money where they mouth is, so to speak -- isn't worth getting involved with.

I'll be honest with you, when I was much younger (and more naive) than I am today, I was more quick to trust people. For one, because I liked them, and two, because it "felt" right.

Case and point: If you ask someone to validate what they are telling you, and they aren't willing to do so, don't do business with them. We have all been told that we should "follow our heart" but this is some of the worst advice you can ever get. In fact, the scripture tells us in Jeremiah 17:9:

"The heart is deceitful above all things, and desperately wicked: who can know it?"

Whenever I have taken what people have said to me at face-value (whether that be in my personal life or my professional/business life), and never took the time to validate what was being told to me -- and simply went off my feelings, I ended up being deceived. I ended up being emotionally scared or out thousands of dollars.

Look, I know this goes against everything that you have ever been told, but trust me, never make major life decisions based off your feelings or what you heart tells you because your heart will deceive you.

Instead, put your feelings aside and demand validation. If you can't ask someone to prove themselves to you because you "trust" them and it "just feels right", then trust this: People betray people everyday -- it happens. It is the kind of world we live in.

Now, let me make this clear: I know that this is more easier said than done. Just like you, I want to be able to trust people, and deep down, I want to believe that people are goodhearted, but I also know that this isn't a perfect world.

Also, when it comes to the subject of trust, I know that in order to get trust you have to give a little as well. In other words, you have to make room for someone else's trust by giving some of yours away -- which means if you want someone to be open and transparent about what they are telling you by showing proof, then you need to be willing to do the same by validating what you are telling them.

In short, if you can't show me the proof, and I am not willing to do the same, then that lack of transparency speaks volumes. And if I am not given the freedom to ask these hard questions, then the conversation is over.

Money Mistake #6: Settling For Comfort Because The Fear of Freedom is Too Overwhelming

Believe it or not, this is the biggest financial mistake being made in American today. In fact, what the government would want you to believe is that the middle class is supposedly "protected" in this country.

Look, comfort is the enemy of abundance. You see, every greater breakthrough and experience has always been found outside our comfort zone. Peter was able to walk on water because he stepped outside of his comfort zone. The only reason he began to drown was because he took his eyes off what was outside of his comfort zone (the Lord) and began to look at the waves and back to the boat (the comfort zone).

You see, Peter was a fisherman. That was his profession and what he did for a living. When his focus was outside of the comfort zone he was able to experience something that those in the boat never got to experience, what it felt like to be above water -- whether than being held under it.

Photo Credit: media.ldscdn.org

"The middle-class mentality is built upon settling, built upon comfort, on just enough. Just enough income, just enough to save, just enough to invest -- if you can just get a house and a job that you like "just enough", and one that makes you just enough money.... This type of "just enough" mentality will never make your wealthy." - Grant Cardone

Look, you may not want to hear this, but the truth is: The wealthy that you have been raised and taught to despise seek freedom, not comfort. In fact, the wealthy seek so much abundance, that it appears to those that have chosen to live by the comfort mentality, as being greedy. However, the truth is: This speaks more about you than it does them.

You see, the majority of people that choose to live by this comfort mentality force themselves to believe that this is the correct and moral way to live. But, once again, the truth is: All throughout scripture we are taught about "having life more abundantly" and having complete and total freedom in Christ -- where the Spirit of the Lord is, there is Freedom -- not comfort!

No where does it say anything about being comfortable. In fact, the Lord has always been more about stretching us and taken us outside of our comfort zone than He has been about settling or being comfortable.

Now, I will say this: A Jewish friend of mine once told me that the term prosperity in Hebrew has always meant an over-abundance of the presence of God, and not necessarily about money or finances.

But even in the spiritual sense, we are still never meant to settle for comfort in our walk with God. We are always to be seeking after Him more and more -- to pursue an over-abundance of His presence. Just like the deer panteth for the water brook, so to, shall our soul panteth deeply after Him --  never to settle for just enough of His presence.

Money Mistake #7: Diversify, Diversify, Diversify

Like many of these mistakes, I know you have been sold this idea of needing to diversify your investments. But the truth is: This is nothing but a lie from Wall Street. You see, we have been raised to believe that Wall Street is a reliable and credible source. I mean, why would they lead us astray, right? Certainly, they know how to manage money.

Well, you see, that is exactly what they want you to believe. I mean, if you have over a hundred different investments, it can get pretty difficult to manage all those accounts and "assets" by yourself (even 20 or 30 can become overwhelming).

That is why Wall Street has sold you on the idea of diversification, and it is how they've established their business model. In short, diversification is the very reason Wall Street continues to get so rich.

Mark Cuban said, "Diversification is for idiots. " And Andrew Carnegie has been noted for saying, "Take all your eggs and put them in one basket, and then watch that basket!"

Look, those that are truly wealthy go all-in on one (or two at the most) investments, and then work to make those investments return a profit. They don't have a thousand investments, or one egg in one basket and another egg in another basket -- at least not at the beginning.

"By the way, diversification of investments is different than the concepts of creating multiple flows of income, so don't confuse them." - Grant Cardone

If you are in the beginning stages of building your wealth you shouldn't even be thinking about diversifying investments yet because you have nothing to invest. In short, in the beginning you should be thinking in terms of creating your wealth, not conserving it. Create now, conserve later.

What you need to do is focus all your mental energy on one space and get to know it like the back of your hand. When you know something so deeply, and know it can't be destroyed, then you must work to protect that investment with everything you got.

Just like a marriage relationship, once you find that thing you love wholeheartedly, and understand it (and are passionate about studying it), you should go all-in, leave nothing behind.

In fact, if you have been following me for the past few weeks you wold know what I think about this idea of pursuing control. You see, the way to reduce your risk is about taking responsibility (control) for your actions.

Money Mistake #8: Depending On Only One Stream of Income

Now, this may seem almost contradictory to the point we just covered, but the truth is: The only real way to wealth is through multiple flows of income. I mean, imagine having hundreds or even thousands of different income streams working in your favor.

Imagine one income stream coming in from your front door and another stream coming in (rather than out) from your back door -- and why not throw some windows into the equation. In fact, did you know that there were seven streams flowing in and out of the Garden of Eden?

You see, there are some people out there that make 300k or even 400k a year, but it all comes from only one income stream. Although this may seem like a lot of money to some of you, the truth is: These people are not rich or wealthy as you suppose.

They are not able to invest because they know that at any given moment that one stream can be gone. It is nothing more than the perception of being rich, and perceptions are often subjective, and not always based on reality.

"To create real wealth you must make investments that will create dependable income streams or flows over long periods of time."
- Grant Cardone

To start creating new flows of income, figure out how to take the one income stream you have now and increase it by just a little bit. It doesn't matter if you make 3k a month or 10k. If it is only 3k, figure out a way to make it 4k. If it is 10k, figure out a way to make it 12k.

After you figure out how to make that first flow a little bigger, start looking into getting a second income stream going. A few ideas could be getting involved in a network marketing, mowing your neighbors lawn, or if push comes to shove, get a second a job.

The key here is to start something -- no matter how big or small it is -- where you can get another flow going, even if it is just a little drip. Whether your main income source is being a teacher, a waiter, a bus driver, or a plumber, -- whatever it is, you need to work on creating a second flow, somewhere.

In fact, it was Jim Rohn who said, "Work full-time on your job while you work parking-time on your fortune."

Final Thoughts

To be honest with you, there may be more than these 8 mistakes that we have covered in this series, but from what I have found, these are the most popular. If you have been following me now for the past few weeks, then you should be able to see a pattern gradually presenting itself here -- how important it is to take CONTROL of your personal finances.

I hope you got a lot of value out of this two-part series. Next week, we will cover a whole new subject that is still to be announced. With that said, you definitely don't want to miss next weeks 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!

Affiliate Advert: 10X Growth Conference - Grant Cardone

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William Ballard | Business Strategist and Marketing Consultant

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.

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