I have been crying hoarse over the last two-three years about getting financial freedom. How compounding can help you achieve your targets for financial freedom. I have also stressed the difference between financial freedom and becoming rich.
Financial issues are the biggest sources of tension in most people’s lives second only to health. If you are not sure of your financial situation, you cannot think of other things. The biggest lament of most people is “I don’t have the time”
However once you have a situation where you can be free from the pressures of finance, then you can start thinking of how you can make your life better.
Life becomes better when you are able to devote time with your family, go on family vacations, take time out to take care of your health . In all these things the common factor is Time.
While money can be replenished, time is one commodity which cannot be replenished. But when you are under pressures of finance, you don’t think in terms of the perishability of time and life happens and passes you by.
I still remember as if it was yesterday I was 35 and then suddenly I was past 45. Those were the most strenuous years of my life with respect to my financial situation and they just passed away with me trying to balance my accounts everyday.
If I had created my safety net the way I suggest to all the young folks through my writings, I would not have had to face those pressures. Once you have financial pressures your health also fails faster and its an avalanche effect.
So don’t worry even if you start small, let the magic of compounding of work for you so that you reach financial freedom faster, which help you get the freedom of time. Once you have the freedom of time there’s nothing which can stop you. The opportunities are endless.
Till next time then
Yesterday I was listening to the I Love Marketing podcast episode#387 (ilovemarketing.com) . If you are in any way connected to marketing, this is by far one of the best podcasts. Joe Polish and Dean Jackson give a ton of information absolutely free. Incidentally Dean Jackson also runs another podcast called More Cheese Less Whiskers and Joe has another one with Dan Sullivan called the 10X talk. All three highly recommended.
During the Q&A in this podcast while giving an answer, Joe spoke about how people first master a big pain and then when they are able to master one, they evolve and master another one and so on. So what starts as a specific issue to be mastered by an individual then becomes sharable with an audience. Then as the person becomes successful with one set of pain points he starts working on the other areas and improves there and then shares that. As per them most of the genuine personal development people actually have evolved this way.
Come to think of it, if you have been reading my blog, it has all been about the challenges I faced initially with my finances. As the years passed and I became more and more enthralled with the idea of compounding, I started sharing my life lessons on this blog. I have been a big proponent of starting small and letting the magic of compounding play its role. How even being able to carve out small amounts could help you get out of the financial mess towards financial freedom. I have shared the 100s of books I have read on the subject and even given out key ideas for everyone to work with
As I evolved from that level I started focusing on my abilities to read more and retain more, improve my health and other things.
Coincidentally I wrote in my blog a couple of weeks back, before I had heard this podcast, that my blog is going to now be talking about multiple things instead of just financial freedom/independence.
So I think I am on the right track in my own evolution and in sharing my journey with you folks.
Let me know your views.
Till next time….
Hello Everyone. Its been quite a few months since I wrote on my blog. I hope all of you, your families and near and dear ones are safe during these tough times.
I have been contemplating a lot about what should constitute my next items on the blog and the structure. While I have been writing over the last few years on “The Magic of Compounding” and its ability to create “Financial Freedom” I was wondering what would be the outcome for someone to achieve financial freedom. Is that outcome really worth the effort.
So that’s what’s been keeping my mind occupied. I have been reading a lot of books in the meantime, which I will analyse in the coming weeks. The biggest benefit which I could think for getting “Financial Freedom” is to have a life well lived. So compounding becomes a tool to get financial freedom and the freedom you get helps you live your life to a full potential or at least with less regrets of “What Could have Been”.
To be able to “Live Life Well” then you need to have other things also.
- You need to be in good health – if you don’t have health then all you will think of is your ailments – but if you have good health then you can dream about other things
- You need to be able to dream and change contexts from your present scenario – which means you need to gain more knowledge, visit new places and gain more varied experiences
- You need to excel on your own Unique Abilities ( a term Dan Sullivan of Strategic Coach uses very often)
Let me know your comments below on what else you think is needed to “live life well”
So I will be changing the narrative of my blog as we go forward – I will not only talk about “Compounding” and “Financial Freedom” which I am very passionate about, but also look at other areas like Marketing and Health.
Marketing and being able to present things and interact with people has been one of my areas which I think I am very good at. So I would like to share those ideas as I come across them.
In addition I have been very fascinated with how improving my daily health habits has helped me improve myself. A lot of you could be in a similar boat so I would love to share those aspects as well.
When I started blogging my emphasis was to help people especially youngsters to avoid the mistakes that I had made as I reached middle age in my financial abilities.
Now while I will keep on that, the narrative would change to also include how a better health and better marketing could help write on our tombstone – This Person Lived Her/His Life Well
So till next time ….
Dr. Peter Diamandis and Steven Kotler recently released their new book The Future is Faster Than you Think. Being a voracious reader I have been devouring this book as well. We will keep the details of the book out of this post.
This book is part of a trilogy. Their earlier books Abundance and BOLD were amazing and really make you think that we are living in a world which is much better and safer than what our forefathers ever got. If you have not read these books, I would highly recommend you reading them first before you read this one, because it will give you a context to this book. I read their books also when I am feeling low. These books show you that the world is moving in the right direction and human beings have an ability to bounce back and always pivot to a higher level in life.
What I wanted to share from this new book, The Future is Faster Than you Think, was content of two paras which the authors used and which has stuck to me.
They talk about the medial prefrontal cortex which is the part of the brain which gets activated when we think of ourselves. As per them it gets deactivated when we think of others. Surprisingly whenever we think of our future selves it gets deactivated. And the further you project into the future, the more it switches off. Which is why people are not able to save for their retirement because for your brain (medial prefrontal cortex) the person who will benefit from the tough choices you make today is different from you. Now you see the quirkiness even within our own brain. What is supposed to actually get functional when you have to think about yourself, switches off, when you project yourself into the future
The other issue is that our brain does not have the capability to think in exponential and global terms. Due to this anything which is depicted by an exponential equation is difficult for the brain to comprehend.
Which brings me to my fascination with compounding. Compounding in its very nature is exponential in nature. And therefore even though I keep talking about compounding in almost every post, I still find most people read what I write but don’t take action.
Coupled with what I have written earlier about habits, I think that is one of the key reasons why more people are not financially free. They sell time for money and because their brains don’t comprehend compounding they don’t let money work for them.
I once read money is a good “servant” and a bad “master”. So if you can make money work for you by using the laws of compounding, you can aspire for a Future which is much bigger and better than your past.
Till next time then