.How to Use the Compounding Technique to Reach Success

How to Use the Compounding Technique to Reach Success 

By Sim Campbell

Imagine this: a wealthy man gives you two choices. He will gift you a million dollars in liquid cash right now…or a penny doubled every day for 30 days. Which one would you choose?

“I’d take the million…gimme, gimme, gimme!”

I can see you salivating right now. But…not so fast.

Wouldn’t you rather consider the penny?

“C’mon. It’s just a penny.”

Ah… that’s where you’re wrong.

It’s just a penny – but that’s all you usually start out with. If you took the choice of the penny doubled every 30 days, you’d be a multi-millionaire at day 30. To the tune of 10 million dollars to be exact. Do the math if you doubt it.

“But that’s not possible!”

But it is possible. It’s the only thing that’s possible. It’s the slight edge.

 The Subtle Power of the Slight Edge

The book The Slight Edge by Jeff Olson describes how small, seemingly insignificant choices have a massive impact on us down the line. He uses the example of the penny to get his point across sharply.

Continuous actions over time lead to vast advantages…or disadvantages. This “edge” is the differentiating factor between those who blow life wide open and those who find themselves getting tossed about like a leaf in the wind.

You see, our actions don’t occur in a vacuum. They build upon past actions of a similar nature.

You start with one. One becomes two. Two becomes four. So on and so forth. It gets easier to build off of a foundation.

This is how habits such as discipline are created.

Because of this…the slight edge is great! But – it works in the opposite direction as well. If you indulge in bad habits and self-destructive behavior, you will find it easier to do those things over time.

Your successes and failures compound on each other.

But here’s the thing: this is so subtle. By the time you realize what has happened – your results are already evident.

This is why success is not an accident. Sadly, failure is not an accident either. In fact, they’re separated by a fine line. The line is what you do or fail to do consistently over a given period of time.

 The Importance of the Slight Edge

The Slight Edge Technique

You may think this is all theory with no real life application. If you do, I urge you to look around. The car you drive, the computer you use, the body you have, the job you have – all of it is a result of slight edge application.

Rome wasn’t built in a day. It was built brick by brick.

Microsoft didn’t dominate the computer industry in a day. It started with an idea by a Harvard dropout.

You don’t have an awesome relationship in a day. It takes time.

Your health isn’t destroyed in a day. It’s from eating bad foods and indulging in bad habits over time.

You don’t develop a great skill set and reach the top of your field in a day. It takes deliberate practice constructed on a strong base of fundamentals.

There’s no such thing as “big breaks” or “quantum leaps”. Every success or failure doesn’t come in an instant. 

How to Use the Compounding Technique

“Every day, in every moment, you get to exercise choices that will determine whether or not you will become a great person, living a great life.” – Jeff Olson

Living a slight edge life is very easy to do. But it’s easy not to do.

That’s why so many people fall into mediocrity, failure, and living a life that they don’t want to live.

To continue reading, please go to the original article at

https://wealthygorilla.com/compounding-technique-reach-success/

."Financial Advisors and What They Do" Posted by MRiles at TNT

TNT:

MRiles:  Essential Questions for a Financial Advisor

By Wendy Connett  Updated Jun 25, 2019

Choosing the right financial advisor is, in essence, taking the time to invest in what should be a long-term professional relationship that keeps your financial health and future on the right track. The search should go well beyond referrals from colleagues, friends and family and an emphasis on investment performance.

In fact, investors should dedicate as much effort as they would to finding a medical professional with whom they trust their physical well-being. The right financial advisor will provide the professional help needed to reach long and short-term financial goals.

The following are questions that should be asked when choosing a qualified financial advisor. If they can’t or avoid answering them keep looking.

For advisors, being able to answer these questions may be the difference between whether or not a potential client decides to choose you over a competitor.

What are Your Professional Qualifications?

Anyone can hand out business cards maintaining they are a financial advisor so it is important to ask about qualifications and credentials.  

While there are myriad professional designations, top advisors typically have credentials such as certified financial planner (CFP), chartered financial analyst (CFA) and chartered financial consultant (ChFC).

Advisors with CFP designations, for example, are regulated, licensed and take mandatory courses related to financial planning, such as estate planning and retirement planning among others.

Some advisors are also certified public accountants (CPAs). For those who also need tax advice and preparation choosing a financial planner who also has a CPA designation may make sense.

Financial advisors who sell stocks, bonds, mutual funds or insurance have licenses including the Series 6, Series 7, or Series 63. To obtain these licenses they must take exams administered by the Financial Industry Regulatory Authority.

Are You an RIA?

Some financial advisors are registered investment advisors (RIAs), which means they are held to high fiduciary standards put in place to protect investors. The fiduciary standard requires that advisors unconditionally put their clients' best interest first at all times no matter what. 

Advisors who aren’t fiduciaries adhere to a less stringent standard called the suitability standard. This means that any investments they offer must be suitable for a client although it may not be in their best interest.

True to their name, RIAs are also required to register with the Securities and Exchange Commission or the states in which they conduct business. (For more, see: Becoming a Registered Investment Advisor.)

How Do You Charge for Your Services?

Most RIAs charge clients a percentage of assets under management or a flat fee or hourly rate. Advisors who are fee-only do not earn commissions on investment products they sell to clients. On average they charge no more than 2% of assets under management. That percentage often declines the more assets you have for them to manage.

Advisors who work for full-service firms, such as big broker-dealers like Merrill Lynch and Morgan Stanley, typically charge commissions on investment products such as stocks, bonds, mutual funds, exchange-traded funds and annuities that are bought and sold. In theory, advisors who charge commissions could be less objective when recommending investments. 

Who Are Your Typical Clients?

To continue reading, please go to the original article at

https://www.investopedia.com/articles/personal-finance/050815/what-do-financial-advisers-do.asp

.10 Steps To Become A Millionaire

10 Steps To Become A Millionaire

In 5 Years  (Or Less)

By Benjamin Hardy PhD

"A lot of people think we are creatures of habit but we're not. We are creatures of environment." — Roger Hamilton

“Become a millionaire not for the million dollars, but for what it will make of you to achieve it.” — Jim Rohn

Hey!

Money is a means to far more important ends.

However, if you don't have clear financial goals—which you track, measure, and report consistently—then you certainly won't hit them.

If you don't have specific and stretching financial goals, it's likely due to limiting beliefs and a fixed mindset.

In this article, I detail a simple (and realistic) 10 Steps To Become A Millionaire In 5 Years (Or Less)

You can do this.  Have an epic week!

It doesn’t matter where you currently are in your financial situation — whether just starting out or already making lots of money.

 Most people, no matter what their income, are treading water. As a person’s income rises, so does their spending.

 Few people understand how to continually increase their income, lifestyle, and joy at the same time.

 In this article, you will learn:

 How to become wealthy

 How to build a life that continually increases your level of confidence and joy

 How to continually expand, learn, grow, and succeed as a person

 How to develop mentorships, friendships, and strategic partnerships with nearly anyone you want

 If these things are not interesting to you, then this article was not written for you.

 Here’s how it works:

 1.  Create A Wealth Vision

 “When riches begin to come they come so quickly, in such great abundance, that one wonders where they have been hiding during all those lean years.” — Napoleon Hill

 Step one of becoming financially successful is to actually create a vision for yourself financially. Einstein said that imagination is more important than knowledge. Arden said creativity is more important than experience.

 How much imagination do you have for your future?

 Do you see huge potential and possibility for your life?

 Or, do you see a pretty average life?

 Creating a vision is an iterative process. You don’t just create a vision once and then never look at it again.

 You continually create and write your vision — every single day.

 Lok at any area of your life in which you’re doing well, and you’ll find it’s because you see something beyond what you currently have. By that same token, look at any area of your life that isn’t exceptional, and you’ll find that you don’t see something beyond what you currently have.

 Most people are living in and repeating the past.

 Having a vision is focused on the future.

Your life and behavior immediately shift when you begin imagining a different future and stridently strive for it.

 In order to do this, you must obliterate your need for consistency. From a psychological perspective, people generally feel the need to be viewed by others as consistent. This need causes people to retain behavioral patterns, environments, and relationships that are ultimately destructive and unsatisfying for far too long.

To continue reading, please go to the original article at

https://benjaminhardy.com/10-steps-to-become-a-millionaire-in-5-years-or-less-4/

.“I Inherited Money And Now I Can’t Blog About Financial Independence Anymore”

“I Inherited Money And Now I Can’t Blog About Financial Independence Anymore”

Doug Nordman  August 1, 2019

If we’re going to talk about awesome Financial Independence lifestyles then we also have to address the hard topics.

I’m finally ready to write about distributing my father’s estate. As many of you may remember, Dad passed away in November 2017 after more than nine years with Alzheimer’s Disease. For over six of those years, Dad was in a full-care facility while I handled his finances.

It only took six months to handle his estate and finish his income-tax returns, but it’s taken me another 13 months (and a lot of keyboard therapy) to internalize everything.

Image of Cameron Huddleston's book cover "Mom and Dad, We Need to Talk: How to Have Essential Conversations With Your Parents About Their Finances" | The-Military-Guide.com

Wish I’d had this a decade ago.

I’ll discuss the mechanics of distributing an estate, as well as the lessons learned. In a future post, I’ll talk about how Dad’s death improved our own Ohana Nords estate planning.

We don’t talk enough about financial literacy in polite society gatherings– let alone aging and estate planning– yet almost everyone in the room is dealing with the caregiver burdens and the concerns of losing a loved one.

This was a painfully tough post to write, but I feel that it’s an important challenge. Financial independence gives you a lot more control over your time (and energy), but the unicorns & rainbows are always interrupted by real life. If we’re going to talk about awesome FI lifestyles then we also have to address the hard topics.

I’d particularly like to thank Dew-Anne Langcaon and Bonnie Castonguay at Ho’okele Health Innovations for helping me navigate Dad’s dementia symptoms all the way back in 2009. They were always standing by over the years. I’d also like to thank Cameron Huddleston (again!) for just letting me talk. I’m no expert but I can pass on a lot of good advice.

 My blinding epiphany of the blatantly obvious

You’re never ready for the death of a loved one. Even though I had years to prepare Dad’s finances for his death, my brother and I still weren’t emotionally ready. Dad and my brother were in Denver and I was in Hawaii, but thousands of miles of separation made no difference in the pain and the other feelings.

We also weren’t ready because Dad had survived so many medical scares. The month before he died he had just begun showing some of the symptoms of end-stage Alzheimer’s, yet it’s quite common for late-stage Alzheimer’s to continue for several years of progressively worse issues.

When Dad first started having trouble with very low blood pressure and a sudden loss of physical coordination, we expected that he’d pull through this “health crisis” just like several times before.

Two days later, on the doctor’s advice, Dad was in hospice care and (at additional expense) a 24/7 care nurse.

While my brother and I were girding ourselves for weeks of medical assistance, on Friday evening Dad was given a small dose of morphine to calm his restlessness. He slept soundly through the night, and on Saturday he never woke up.

To continue reading, please go to the original article at

https://the-military-guide.com/lessons-learned-settling-my-fathers-estate/

.What I Learned From Losing $200 Million

What I Learned From Losing $200 Million

The 2008 financial crisis taught me about the illusion of control, and how to give it up.

By Bob Henderson   December 24, 2015

I’d lost almost $200 million in October.  November wasn’t looking any better.

It was 2008, after the Lehman Brothers bankruptcy. Markets were in turmoil. Banks were failing left and right. I worked at a major investment bank, and while I didn’t think the disastrous deal I’d done would cause its collapse, my losses were quickly decimating its commodities profits for the year, along with the potential pay of my more profitable colleagues. I thought my career could be over. I’d already started to feel those other traders and salespeople keeping their distance, as if I’d contracted a disease.

My eyes started to fill from a sudden wash of gratitude and relief that came, I think, from no longer being alone.

I landed in London on the morning of November 4, having flown overnight from New York. I was a derivatives trader, but also the supervisor of the bank’s oil options trading team, about a dozen guys split between Singapore, London, and New York. Until this point I’d managed the deal almost entirely on my own, making the decisions that led to where I ... we ... were now.

But after a black cab ride from Heathrow to our Canary Wharf office, I got the guys off the trading floor and into a windowless conference room and confessed: I’d tried everything, but the deal was still hemorrhaging cash. Even worse, it was sprouting new and thorny risks outside my area of expertise.

In any case, the world was changing so quickly that my area of expertise was fast becoming obsolete. I pleaded for everyone to pitch in. I said I was open to any ideas.

As I spoke, I noticed that one of the guys had tears welling up in his eyes. I paused for a second, stunned. Then my own eyes started to fill from a sudden wash of gratitude and relief that came, I think, from no longer being alone.

Stress testing is a standard technique derivatives traders use to test how their portfolio will perform in an imagined “worst-case” scenario. The problem is that “worst-case” is subjective, making stress testing as much of an art as a science, and exposing the trader doing the testing to something called the “illusion of control.”

The psychologist Ellen Langer coined the phrase in 1975 to describe “an expectancy of personal success probability inappropriately higher than the objective probability would warrant.”

Experimental evidence for the illusion goes back at least to 1965, when one research team found that college-educated employees of AT&T asked to press buttons to illuminate lights had the tendency to believe they had more control than they actually did, even when the lights lit randomly, and even when they used pen and paper to track their results.

In another study, done in 1992, a group of Israeli college students was found to be more willing to bet on dice, and to bet bigger, before they rolled than after, reflecting the belief that they had control over their rolls. Such a preference for prediction over postdiction had been observed before, but this study also found that the preference grew stronger when the students were threatened with an electric shock if they guessed wrong—evidence that stress amplifies the illusion of control.

Langer’s work showed that the illusion is also intensified by “skill cues”: circumstances that make people feel like they’re engaged in acts of skill rather than luck. Such cues include competition, choice, and familiarity with the task at hand.

Therefore people will tend to overestimate their prospects in a game of pure chance even more than usual if they face a nervous-looking opponent, or if they pick rather than get assigned a lottery ticket, or if they’re given the chance to familiarize themselves with an apparatus that’s simply spitting out random numbers.

Or, I might add, if they’ve toiled over complicated mathematical equations to back up their decisions.

I thought I knew what I was getting into. I’d helped my bank win the fateful deal by developing a complex option on crude oil, together with a risk management strategy. My equations told me how I could buy and sell simpler financial products over time to approximately offset my daily gains and losses on the option I’d sold.

To continue reading, please go to the original article at

http://nautil.us/issue/31/stress/what-i-learned-from-losing-200-million

.The Relative Value of Money

The Relative Value of Money

By Kevin  Financial Panther

There’s a concept that I’ve been thinking about over the past couple of years, especially as I’ve made this transition from a full-time, professional, real job, to a quasi-fake job as a blogger and gig economy worker. It has to do with a concept you could call the relative value of money.

When I think about what that means, it’s basically the idea that money you earn from one activity might be worth more to you personally compared to the money you earn from another activity.

In fact, it might be worth so much more to you that you’ll opt to spend your days earning money in that manner even if it means you’re making less money from an objective standpoint. This concept has really come into clearer focus to me over the past few years and I think it helps explain why I’ve made a lot of the work decisions I’ve made.

One of the weird things I’ve done consistently over the past few years is doing pretty low-level side hustles using sharing economy and gig economy apps. From an objective standpoint, it really didn’t make much sense for me to do all of this stuff. At the peak of my lawyer career, I was making $300 or more per day from my salary, obviously more than enough to live very comfortably.

And yet, even though I made all of this money, I still chose to spend my spare hours doing silly things like delivering food to people on my bike and selling stuff I found in the trash.

The common criticism I’d get was that doing this stuff was a waste of my time. The better use of my time would be to focus on my job and continue to progress in my legal career. Eventually, I could try to become a partner somewhere or just do something to continue to increase my salary, or at least to increase my prestige.

In truth, that’s probably what I should have done, at least if we’re looking at pure numbers. I could obviously make much more money as a lawyer than I could from all of the stupid things I was doing. But the few bucks I made doing my random gig stuff felt so much more valuable and rewarding to me compared to any dollar I earned from my regular paycheck.

The thing I’ve learned to value more and more is control over my life. I suspect that’s something a lot of people on the path to financial independence value too.

The money I made from my day job, however, was the exact opposite of control over my life. I had to be at the office at a certain time, do things that other people told me to do, and basically, plan my life around my job. It made me feel trapped.

A dollar might have the same objective value no matter how you choose to earn it. But how you personally value that dollar is another matter. I think that’s worth thinking about.

Thinking About The Relative Value Of Money

One of the podcasts I listen to pretty regularly is Tropical MBA, which I highly recommend you listen to if you’re the entrepreneurial type looking for some help and motivation.

To continue reading, please go to the original article at

https://financialpanther.com/the-relative-value-of-money/

.Should You Always “Protect The Principal?”

Should You Always “Protect The Principal?”

By Khe Hy   the creator of RadReads

Elon Musk was nearly broke in 2008, borrowing money from his homies to cover his rent. “About four months ago, I ran out of cash,” he stated during his divorce proceedings. His brother Kimball confirmed his precarious position, “Oh yeah. [He’s] in debt. More than broke.”

And then-girlfriend, Talulah Riley remarked on his physical condition: “I remember thinking this guy would have a heart attack and die. He seemed like a man on the brink.”

Yet six years earlier, Musk had personally pocketed a whopping $220 million when eBay bought Paypal. How on earth could he possibly end up in such dire straights? Why didn’t he protect the principal?

We all grows up with aphorisms that define our relationship with money. You’ve all heard folksy phrases like “Money doesn’t matter” or “If you have to ask the price, you can’t afford it?” And when it comes to protecting your baseline, even farmers know that you shouldn’t “eat your seed corn.”

Yet despite having hundreds of millions in the bank, Musk chose to put the principal at risk – every ** penny – because he didn’t want to pick a favorite between Tesla and SpaceX. He told Bloomberg’s Ashlee Vance:

“If I split the money, maybe both of them would die. If I gave the money to just one company, the probability of it surviving was greater, but then it would mean certain death for the other company.”

Putting all the principal on the line has paid off famously for Musk. But would that work if you had a smaller amounts of assets in the bank? Yes, protecting the principal seems like prudent strategy. But it can also be a self-limiting strategy when it comes to changing careers, becoming an entrepreneur and investing.

We should all lose our brokerage account passwords

In my money coaching practice, I ask my clients “If I stole 15% from your investment accounts, would you notice?” There’s the rare “Hellz yeah” from the penny-tracker whose multi-tabbed spreadsheet monitors the movement of every Latté. However, most clients wouldn’t notice this larceny for a handful of reasons.

Some know that the monthly and quarterly movements don’t matter (and that the best investors are those who forget that they even have an account).

Others (especially those with kids) may have lumpier expenses (i.e. tuition, life insurance, summer vacations) that obfuscate any linearity of cash flows. And finally, there’s also the avoiders, who explicitly choose not to know.

If you’re investing, your assets bounce around (sometimes a lot)

So if we accept that one’s net worth will bounce around, why is it that when faced with a life transition, our anchoring bias kicks in. In the same way we anchor to our “buy” price in refusing to sell a stock or home that’s lost some value, when we change careers we anchor to an imaginary red line. We protect the principal.

The longer I’ve been an entrepreneur, the less I care about protecting the principal. And it’s not because I’ve made more money (in fact, I haven’t.) I recently received an email from a concerned and puzzled RadReader about my decision to stay in the red — to fund RadReads out of my savings. Having been in similar shoes, he wrote:

How do you reconcile the values of independence and duty to family with not breaking even for so long. I believe that I owe it to my family to run my business at a cash profit every year, even though I could afford not to turn a profit for a while.

As he continued, I could relate to the tension between my own fulfillment and the sense of duty I have (particularly as the sole breadwinner) to my family:

To continue reading, please go to the original article at

https://radreads.co/protect-principal/

.You’re Thinking About “Financial Security” The Wrong Way

 You’re Thinking About “Financial Security” The Wrong Way

By Khe Hy the creator of RadReads.

“Nah, I’m going to wait a year.”

Every winter, my hedge fund manager friend stares at a new set of golf clubs, almost buys them, and then punts until the following year. Why? His three kids are self-sufficient adults, his fund’s doing well, and he’s not a big spender. But he’s got a nagging fear. A fear that one day he’ll be broke. And so, the golf clubs will have to wait. He’s waiting to reach an elusive goal: financial security.

Having spent 15 years on Wall Street, I’ve grown accustomed to these successful folks who are “bracing” for their worlds to come crashing down. They’re smart, humble, and often from modest roots.

They believe in “The Number,” a mythical amount in their bank account where they can stop worrying. But The Number never arrives.

Money Messes With Our Minds

Money is notorious for causing smart and rational people to make questionable decisions. Let’s start with the definition of financial security. We’d probably agree that it means the ability for you (and your family) to acquire shelter, food, clothing, and healthcare. Or more bluntly, to survive — no one wants to put themselves and loved ones in danger.

Think about the word survival. As I type it, my palms are getting sweaty and my heart rate is increasing. Survival triggers our threat-detection response,which has done wonders for us as a species from an evolutionary perspective, but may have outlived its usefulness in our modern society.

Think about your last major screw up at work. Did you think that you might get fired? Did you feel like your survival was at risk?

One of the benefits of modern society is that covering your basic needs is a pretty low bar. I’m going to go out on a limb and say that if push came to shove, many RadReaders’ survival would not be at risk.

I know what you’re thinking “Well, what if I got fired? I could end up broke and on the street.” That’s probably unlikely. Many of us could move into our parents’ places; or we could significantly downsize our homes/expenditures, and get a job that provided health insurance.

Many of those things sound unappealing. Moving in with mom and dad at 38 is not particularly crushing it. But it does meet the minimum threshold of our “ability to acquire shelter, food, clothing, and healthcare.”

Why’s this so confusing? Besides the fact that our threat-detection reflex impairs decision-making, we often confuse financial security and what I’ll call a life well lived.

To continue reading, please go to the original article at

https://radreads.co/youre-thinking-financial-security-wrong-way/

.What Do I Want My Money to Do For Me?

What Do I Want My Money to Do For Me?

Posted September 1, 2019 by Ben Carlson

Sometimes branding is everything in life.

Life insurance didn’t take off until they changed the name from death insurance.

Escargot sounds more appealing than eating snails.

Global warming might be more concerning to more people if they called it planetary destruction or something that’s not so warm and fuzzy.

Budgeting probably has the worst branding of any topic in the personal finance realm.

Most people HATE budgeting.

They hate the idea because it feels restrictive. They hate the process because it makes them afraid to admit where are their money is actually going. And they probably hate the word because budgeting doesn’t sound like something that’s fun to try.

It’s also a topic that doesn’t get enough play in the financial advice arena.

There is plenty of advice out there about markets and investing.

There are plenty of blogs about paying down debt and saving money.

There are very few people who give advice about how to spend money.

Most people assume budgeting is about saving money but it’s really about how you choose to spend your money. One of the better books I’ve come across on the topic is You Need a Budget by Jesse Meachum. Jesse does a wonderful job of re-framing the budgeting conversation.

He made three points worth highlighting:

Design your financial life around your priorities. There’s an old adage that personal finance people use that goes something like this: if you want to know where your priorities lie, take a look at your checkbook and your calendar. We might have to update this to say banking app instead of checkbook but you get the idea.

Meachum rightly talks about the importance of prioritizing your spending:

Without a budget you have no way to prioritize your spending. You often don’t even know where your money is truly going. You may stress about not being able to afford what’s important to you while you simultaneously spend on things you’d willingly nix if you could see the trade-offs. That’s the beauty of a (good) budget: it lets you see exactly how your spending affects the rest of your life.

The goal isn’t necessarily to track every expense down to the last penny. But you should have some sort of spending plan that takes into account your priorities, needs, and current financial circumstances.

To continue reading, please go to the original article at

 https://awealthofcommonsense.com/2019/09/what-do-i-want-my-money-to-do-for-me/

.How to Use the Compounding Technique to Reach Success

How to Use the Compounding Technique to Reach Success

By Sim Campbell

Imagine this: a wealthy man gives you two choices. He will gifts you a million dollars in liquid cash right now…or a penny doubled every day for 30 days. Which one would you choose?

“I’d take the million…gimme, gimme, gimme!”

I can see you salivating right now. But…not so fast.

Wouldn’t you rather consider the penny?

“C’mon. It’s just a penny.”

Ah… that’s where you’re wrong.

It’s just a penny – but that’s all you usually start out with. If you took the choice of the penny doubled every 30 days, you’d be a multi-millionaire at day 30. To the tune of 10 million dollars to be exact. Do the math if you doubt it.

“But that’s not possible!”

But it is possible. It’s the only thing that’s possible. It’s the slight edge.

The Subtle Power of the Slight Edge

The book The Slight Edge by Jeff Olson describes how small, seemingly insignificant choices have a massive impact on us down the line. He uses the example of the penny to get his point across sharply.

Continuous actions over time lead to vast advantages…or disadvantages. This “edge” is the differentiating factor between those who blow life wide open and those who find themselves getting tossed about like a leaf in the wind.

You see, our actions don’t occur in a vacuum. They build upon past actions of a similar nature.

You start with one. One becomes two. Two becomes four. So on and so forth. It gets easier to build off of a foundation.

This is how habits such as discipline are created.

Because of this…the slight edge is great! But – it works in the opposite direction as well. If you indulge in bad habits and self-destructive behavior, you will find it easier to do those things over time.

Your successes and failures compound on each other.

But here’s the thing: this is so subtle. By the time you realize what has happened – your results are already evident.

This is why success is not an accident. Sadly, failure is not an accident either. In fact, they’re separated by a fine line. The line is what you do or fail to do consistently over a given period of time.

 The Importance of the Slight Edge

To continue reading, please go to the original article at

https://wealthygorilla.com/compounding-technique-reach-success/ 

.15 Personal Finance Rules to Live By

15 Personal Finance Rules to Live By

The following is a guest post from Marc at VitalDollar.com.

Have you ever wondered what separates those who are successful financially with those who are not? Have you felt like your income should allow you to live a much more comfortable life than what you are experiencing?

Personal finance doesn’t have to be complicated. There are a few basic rules that you should follow, and if you do that, everything else falls into place.

This article covers some of the most basic and most powerful financial rules that should impact your everyday life.

1. Spend Less Than You Earn

Arguably, the most important financial rule is to spend less than you earn. Regardless of how much money you make, it’s impossible to get ahead if you’re spending it all. Even worse, you could be going backward and accumulating debt if you’re spending more than you earn.

Lifestyle creep is when your spending increases at the same rate as your income. Ideally, as you progress through your career your income will rise. If you’re able to minimize lifestyle creep and keep your expenses at the same level, you’ll be able to save and invest the excess.

Ultimately, how much you keep is far more important than how much you earn. Someone with a $50,000 income can wind up in a better spot than someone with a $500,000 income based on how much is spent and how much is kept.

2. Know Where Your Money is Going

Establishing a budget is common financial advice. A budget gives you control over the way your money is spent, which helps you to make the most of the money that you have.

While budgeting is important, it’s equally important to track your expenses. If you’re not tracking your expenses, you won’t know if you are truly sticking to the budget.

Knowing where your money is going is a critical aspect of managing your money wisely. If you haven’t budgeted or tracked your expenses in the past, it can be an eye-opening experience.

When you see how you are really spending money, you’ll probably be able to quickly identify a few areas where you’re spending too much and could easily cut back (with a little bit of discipline).

3. Avoid Impulse Purchases

Most people spend their money based on emotions. Impulse buys can be small things (like picking up a few items when you’re checking out at grocery store, or it can be bigger things like a timeshare.

Large impulse purchases can obviously have a damaging impact on your finances, but even the small purchases add up.

To get control over the small impulse buys you can commit to grocery shopping with a list, and sticking to the things on your list.

For larger purchases, get in the habit of waiting at least 24 hours (or longer, if possible) before making a buying decision. When you take time to evaluate the purchase based on all of the factors involved, you’ll often find that you don’t really want or need that thing that you almost bought. You’ll reduce buyer’s remorse and keep more money in your pocket.

To continue reading, please go to the original article at

https://www.freemoneyfinance.com/2019/07/15-personal-finance-rules-to-live-by.html