Financially Fit For The Long HaulSunday, May 31, 2020
It is human nature to want immediate results; let's face it, we thrive on instant gratification. Waiting around and doing nothing can leave us feeling helpless, especially during this time when we are encouraged to “wait and see” what happens. More often than not we know a task will take some time but we cannot help trying to speed things up.
But similar to opening the oven door too early while you're baking a cake, interfering in a process increases the chances of not getting the outcome that you want. Investment is a bit like baking. You need to accept that things may take a while, and have patience, or you won't end up with what you were aiming for.
Here are a few tips for playing the long game and maintaining healthy financial standing during times of uncertainty.
1. Only buy at a discount
Companies worldwide are offering amazing discounts on products and services. Now that several businesses have gone online, many are creating packages such as 'buy one, get one free'. Explore the sale section on your favourite retail store; you never know what gems might be hidden at half the price.
2. Only buy assets that can appreciate
This the secret to building wealth: Buy assets and avoid liabilities. The first time this became clear to me was when I read Rich Dad, Poor Dad by Robert Kiyosaki. I used to think that an asset was anything that had a cash value. However, that's not the right way to look at it. If you want to become wealthy, you need to think of your household finance as a business. An asset is something that, in the future, can generate cash flow for you. Assets make money. Anything that takes money out of your pocket is a liability. Put your money into stocks, bonds, real estate or even start your own online business.
3. Only spend on necessities
Always set your priorities when spending. Distinguish the things you are going to need and the ones that are less likely needed in everyday life. Cut off the spending that goes to materials that are not essentially used. Be practical; spending more is not destructive as long as it is spent on essential items.
4. COVID-19 incentives
Many companies are now offering attractive COVID incentives. Take advantage of them but be sure to read the fine print.
Patience is a virtue; however, impatience is a reality. Long-term financial health is all about taking it slow, being focused and allowing your money to work for you.
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