A Plan for Financial Success

This second commentary was originally posted March 9, 2009.

The nation was firmly entrenched in the recession but by no means headed for depression. I remember the little quip: a recession is when your neighbor loses his job; a depression in when you lose yours.

When asked by a Senate subcommittee, Ron Blue provided a straightforward “plan” for financial success given the current economy. Think long term, spend less than you earn, maintain emergency savings, and minimize debt.

In reality, Mr. Blue simply provided four sound, timeless financial principles. They were true going into the depression, in the midst of it, climbing out of it, into today and far into the future.

Those who followed these principles thrived. They thrive today. They will thrive tomorrow. Are you following them?

If you are in crisis, there is no better time to start then now.

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What if you had a plan for financial success?

Ron Blue recently testified before a Senate subcommittee conducting hearings on “Solutions for a New Era: Jobs and Families.” Mr. Blue was appearing based on his solid reputation of financial expertise.

A Senator asked him what the average American family should do in the current economy. Ron Blue said that the American family could benefit from following a four-part financial plan:

• Think long-term with goals and investing
• Spend less than you earn
• Maintain liquidity (or emergency savings)
• Minimize the use of debt

Think Long Term: The longer term your perspective, the better financial decisions you will make.

Spend Less Than You Earn: You need to know what you are earning, what you are spending, have a plan and monitor it. Over the long term, this will contribute to financial success.

Maintain Emergency Savings: A reserve will help you ride out the surprises of life and avoid debt.

Minimize and Eliminate Debt: Debt may allow you to have more now, but it reduces your ability to have more in the future. Debt is an obligation on your future income, and because of compounding, it may represent the single most important factor influencing your future financial success.

These four principles work in concert. Together, they represent a formula for financial success.

These principles are so timely to today’s economic climate. Perhaps because they are timeless. They are by no means new; they trace back for thousands of years.

The principles have endured the test of time. They are independent of the economy - recession or boom. They are insensitive to oil prices and the real estate market. Many rich people, and likely many more poor people, can attest to them.

Those that have followed this path in recent years are comfortably surviving - some thriving - in the economic concerns of today. If you have been following them, continue. You will continue to thrive.

If you are in crisis, there is no better time to start then now. You cannot establish a strong financial foundation without them. They will lead you out of your crisis, and help you prevent them in the future.

Note - reference source “Surviving Financial Meltdown” by Ron Blue and Jeremy White.

Your Greatest Competition

No matter your level of success, there is always at least one person who is out to beat you… determined to pass you and render you obsolete. Therefore, make sure that your greatest competitor is the future version of YOU.

How many times have you heard, “Your competition never sleeps?” How often have you been warned that your company should never be complacent, no matter your current level of success?

In the business world, competition is fierce. It is constant. When you are on top, many others are working on a plan to enhance what you provide, steal a share of your market, or worse, create the “game-changer” that makes your products or services obsolete. Even when you create the game-changer yourself, the competition is either already at work on the next one, or tearing your idea apart looking to create a better Version 2.0, while some simply want to knock you down.

Have you ever considered the same principles apply to you as an individual?

Perhaps you’ve seen someone plateau at work, only to be surpassed by a more determined candidate. Worse, you have probably witnessed someone take their eyes off the ball – through a lack of judgment or a misstep in character – virtually handing the prize to others.

Few recognize the power of competition, and even fewer will consider that competition important enough to warrant action. In time, those that fail to take action will be replaced, rendered obsolete, or at best left to dwell in relative mediocrity.

Most people reading this may think the message here applies to the business world, and only the business world. What if that same principle also carried over to every other aspect of your life? What if there is someone in competition for your spouse or significant other? What if someone is out to steal the attention of your children, vying to exert influence that should be reserved for you? What about your personal finances, and the financial principles that govern your treatment of money and your financial future?  Who is out to gain at your expense? Who is out to somehow negatively impact your mental, physical or spiritual fitness?

I don’t bring this up as some kind of “scare tactic”, but a true reminder that unless you’re PROactively improving your awareness, mindset and knowledge in the areas of business, family, finances and other key areas – you’re falling behind and leaving yourself vulnerable.

There is always someone out there trying to pass you, either by forging ahead or by bringing you down a notch. Sometimes both. Think about what is most important to you. Consider the fact that others are competing to take that away from you. What actions are you taking to assure that you’re able to overcome that competition, knowing that there will always be competitors?

Make the future version of you your greatest competition, and you’ll be starting on the right path for success and constant improvement in life and in business.

Inspiration for the Battle

I've assembled several of my favorite quotes - those that inspire my pursuit of a self-directed education. I hope they serve as inspiration for you as well!

“What we do on some great occasion will probably depend on what we already are; and what we are will be the result of previous years of self discipline.”

- H. P. Liddon

“You must take personal responsibility. You cannot change the circumstances, the seasons or the wind, but you can change yourself.”

- Jim Rohn

“Everyone is looking for a quick fix, but what they really need is fitness. People who look for fixes stop doing what’s right when pressure is relieved. People who pursue fitness do what they should no matter what the circumstances are.”

- Kevin Myers

“You want to set a goal that is big enough that in the process of achieving it you become someone worth becoming.”

- Jim Rohn

“The time to prepare isn’t after you have been given the opportunity. It’s long before that opportunity arises. Once the opportunity arises, it’s too late to prepare.”

- John Wooden

“Twenty years from now you will be more disappointed by the things that you didn’t do than by the things you did.”

- Mark Twain

“The greater danger for most of us is not that our aim is too high and we miss it, but that it is too low and we reach it.”

- Michelangelo

“More often than not, the only thing between you and your dream is a rational excuse.”

- Mark Batterson, In a Pit with a Lion on a Snowy Day

A Self-Directed Education – Your Greatest Investment

I had always thought that my education ended with the formal "school system" process; information that someone else delivered, a curriculum leading to a diploma that someone would bestow upon me. Information that would prepare me for life.

Sure, I would eventually learn the skills required to succeed in my profession, and perhaps different skills from job to job. But I truly thought that the core of my education was over.

What I learned (pun intended) was that it had never ended. Instead, it was stronger than ever. I discovered that every day, often many times a day, I was learning from someone. Perhaps it was someone from the radio, television, or movies. Perhaps it was a co-worker, a buddy, or even a stranger. I was absorbing information. I was absorbing different ways of thinking. That information, repeated over time, formed my guiding principles and my life roadmap. Bottom line, it defined my worth.

My worth? Hold on, that one was a bit of a stretch. My diploma drove my worth, and my natural movement up the corporate ladder would drive my future worth. I'm not sure where along the way I learned that, but over time I found how untrue that would be.

What I instead learned was a critical guiding principle... that we are all compensated based on the size of the problems we are able to solve. Seriously? Yes. And by coincidence, I discovered it by reading new materials intended to develop such expertise.

The problem? The current information that represented my "education" was teaching me negative thinking, poor habits, lack of discipline. I was listening to complaints about the company and the inequities of the system. I was hearing that I was doing pretty good - certainly good enough. I had no time or concern for addressing the areas that were holding me back. That was lowering, not adding to, my value.

From the neck down, we are all minimum wage. That's a strong statement. The first time I heard it, it was a very convicting statement. While going about my work, I had never contemplated my value. I never contemplated my potential value. In my current position, I was being compensated based on the worth of the job I was performing. Indeed, for the size of the problems I was solving. It was my value in that role. But what was I doing to enhance that value, whether applied in that role or a future opportunity? What was I doing to exert value outside of my assigned role?

Added value comes from critical thinking, from knowledge put into action, and from the ability to influence. Even greater value comes from leverage and duplication. That added value produces profit and growth. Most often, it translates to the "soft skills." Leadership skills, if you would.

John Maxwell contends that "Leadership is influence - nothing more, nothing less."

One of my mentors shared a quote attributed to Charlie "Tremendous" Jones that, for me, made the ultimate connection: "Leaders are readers."

Critical leadership and personal skills, attributes that differentiate our value and drive our ability to influence, are rarely provided within our formal education. They are seldom delivered in a tidy seminar thereafter. More than anything, they are found through an investment of time, hard work, and perseverance.

Hard work, geared towards improvement, applied over time, leads to high achievement. An intentional self-directed education is where you learn the guiding principles that drive the greatest accomplishments.

Said another way, daily discipline, over time, produces change. Depending on the information, that can be a positive change or a negative one - the principle works the same in either direction.

Looking at the lives of successful people I studied - historical through the present day - I've found that anyone with high achievements was a voracious learner, constantly consuming positive information. In almost all cases, that learning was outside the formal education process.

What I learned was that, for me, my best chance for lasting growth and success was to constantly develop my skills in key areas - character, behavior, critical thinking, and positive attitude, just to name a few. I had to maximize my personal gifts, as well as develop and enhance a wealth of key skills, to truly compete, influence, and lead.

Almost a decade into this journey, with a lifetime of learning still ahead, I can honestly say that this pursuit has been the highest contributor to the successes I have enjoyed, the most significant source of the value, influence and impact that I provide, and the greatest reason for the hope and promise of my future.

"An investment in knowledge always pays the best interest." - Benjamin Franklin

A self-directed education is indeed the greatest investment you will ever make.

Success is a Decision

"I found every single successful person I've ever spoken to had a turning point and the turning point was where they made a clear specific unequivocal decision that they were not going to live like this anymore. That they were going to achieve success. And some people make that decision at 15 and some people make it at 50, and most people never make it at all."

Brian Tracy

The Making of a Champion

Here's a quote that I heard tonight on a conference call. It's an incredible reminder of the activity - the work, the sweat, and often the time - required to reach your victory.

The most concise description I have heard is this:
Dream, Struggle, Victory

Many want to skip right to the end! They have a dream. They expect the victory. You can't just skip a step. If you want the victory, you must endure the struggle. And the greater the victory you desire, the greater your struggle.

Besides, if was that easy, would it really be worth it?

The quote? Enjoy...

"I hated every minute of training, but I said,
'Don't quit. Suffer now and live the rest of your life as a champion.' ''

Muhammad Ali

Attitude is Everything

"Nothing can stop the man with the right mental attitude from achieving his goal; nothing on earth can help the man with the wrong mental attitude."

Thomas Jefferson

A Plan for Financial Success

What if you had a plan for financial success?

Ron Blue recently testified before a Senate subcommittee conducting hearings on “Solutions for a New Era: Jobs and Families.“ Mr. Blue was appearing based on his solid reputation of financial expertise.

A Senator asked him what the average American family should do in the current economy. Ron Blue said that the American family could benefit from following a four-part financial plan:

Think long-term with goals and investing
Spend less than you earn
Maintain liquidity (or emergency savings)
Minimize the use of debt

Think Long Term: The longer term your perspective, the better financial decisions you will make.

Spend Less Than You Earn: You need to know what you are earning, what you are spending, have a plan and monitor it. Over the long term, this will contribute to financial success.

Maintain Emergency Savings: A reserve will help you ride out the surprises of life and avoid debt.

Minimize and Eliminate Debt: Debt may allow you to have more now, but it reduces your ability to have more in the future. Debt is an obligation on your future income, and because of compounding, it may represent the single most important factor influencing your future financial success.

These four principles work in concert. Together, they represent a formula for financial success.

These principles are so timely to today’s economic climate. Perhaps because they are timeless. They are by no means new; they trace back for thousands of years.

The principles have endured the test of time. They are independent of the economy - recession or boom. They are insensitive to oil prices and the real estate market. Many rich people, and likely many more poor people, can attest to them.

Those that have followed this path in recent years are comfortably surviving - some thriving - in the economic concerns of today. If you have been following them, continue. You will continue to thrive.

If you are in crisis, there is no better time to start then now. You can not establish a strong financial foundation without them. They will lead you out of your crisis, and help you prevent them in the future.

Note - reference source “Surviving Financial Meltdown” by Ron Blue and Jeremy White.

Your Measure of Success

Quote of the Day:

"The size of your success is measured by the strength of your desire, the size of your dream, and how you handle disappointment along the way."

- Robert Kiyosaki