How to Stop Living Within Your Means | Suze Orman posted on the topic | LinkedIn (2024)

Suze Orman makes some good points here but let's be realistic, real life is much more nuanced than just a hard rule of "live within your needs." Lifestyle creep is literally unavoidable due primarily to #inflation , but also our desire to have more/better things/experiences because we work so hard. I just posted about lifestyle creep & how to avoid it as much as possible here: https://lnkd.in/eRttwvnqThanks to #inflation, either you spend more to maintain your existing standard of living or you have to accept a declining standard of living. There is no way around it.Also, who wants to work their *** off just to maintain their current lifestyle or "live within their needs" ? There is a lot more to life and total #wellbeing than just #money & squeezing every last penny out of your #income to save. There has to be a balance between your #money, #health (financial, emotional, physical, mental etc.) & #time. It's completely natural, & OK, for your #expenses to increase as your #income increases (i.e. lifestyle creep). You just have to have a balance & ensure that your expenses don't increase faster than your income. That's the key, not "living within your needs" like a peasant.The most effective way to establish such a balance is to have a rule whereby you save or paydown #debt with ATLEAST 50% of any raise or financial windfall you receive. I personally save 60% of any raise & 75% of any windfall. For example, if I receive a 5% raise, 3% goes into #savings or paying down #debt , & I'm free to spend the other 2%. If I receive a $1,000 bonus (after tax) then I add $600 to #savings or pay down #debt with it, while the remaining $400 I'm free to spend.This ensures that my savings rate is always increasing, getting me closer to the 30% savings rate that, IMO, is the key to first establishing financial stability & eventually freedom.Obviously, the % of a raise/windfall that you add to savings or pay down debt with increases the more indebted you are (or your expenses exceed your income). If you spend more than you make &/or are heavily indebted, then yes, you will have to "live within your needs." But for those in better financial positions, it's not necessary, & frankly discouraged IMO. Nuance and adaptability is what works in the real world, not rigid rules like "live within your needs."

🔥 Unlock Your Financial Success with These 5 Rules for a Lifetime! 💰🔵 Rule 1: The 3-Day RuleBefore making any major purchase, especially those big-ticket items, take a pause! ⏸️ Apply the 3-Day Rule, and for non-essential items, wait three days. During this time, reassess your desire and determine if it's a genuine need or just an impulse. Embrace this rule to master mindful shopping and make wiser financial decisions.🔵 Rule 2: The 75-15-10 RuleAchieving a balanced financial life is all about allocation. According to the 75-15-10 Rule, here's how you should distribute your monthly income:✅ Spend 75% on needs and wants✅ Allocate 15% for investing✅ Set aside 10% for your emergency fundOnce you've saved up 3-6 months of expenses in your emergency fund, shift to the 80-20 rule, with 80% for needs and wants and 20% for investing. This rule ensures financial stability while nurturing your future growth. 🔵 Rule 3: The 20/10/4 RuleThinking of buying a car? 🚗 The 20/10/4 Rule is your go-to guide for making a smart financial decision. Follow these steps:✅ Make a 20% down payment on the car loan to reduce financing and monthly payments.✅ Ensure your car payment stays below 10% of your monthly income for affordability.✅ Opt for a loan term of four years or less to pay off the loan sooner and potentially save on interest. 🔵 Rule 4: The 5-10-30 RuleDreaming of owning a home? 🏡 The 5-10-30 Rule will guide you on the path to homeownership success:✅ Set aside 5% of the total house value as an emergency fund.✅ Allocate 10% of the house value as the down payment.✅ Ensure that your monthly mortgage payment doesn't exceed 30% of your monthly income.Following this rule ensures you have a safety net, a substantial down payment, and a manageable mortgage, making your home purchase a financially sound and rewarding. 🔵 Rule 5: 4% Withdrawal RuleThe 4% withdrawal rule unlock the power of your savings/investment while enjoying a steady income with the 4% Withdrawal Rule. It's simple yet effective:For every $100 of savings/investment, you can spend $4 annually. This rule assumes your wealth can grow at a rate of 8-10% or higher, even considering an assumed inflation rate of 3.5%. With this strategy, your money effectively grows at 8%, allowing you to enjoy net $4.5 for every $100.By following this rule, you'll strike a balance between preserving your savings/investment and enjoying the fruits of your hard-earned wealth. Remember, these financial rules are not just for today but for a lifetime. Incorporate them into your financial journey, and witness the transformation they bring to your financial well-being. Follow Kunjan Doshi, TGIT for similar content ✨️ Watch Reel on IG :https://lnkd.in/eD8XEk6T#FinancialSuccess #moneytips #personalfinance #linkedinforcreators #immigrants

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Client-Centric Financial Solutions: My Reverse Options' ApproachIn an increasingly complex financial world, it's easy for individuals to feel overwhelmed, especially when it comes to making decisions about their retirement and home equity. At My Reverse Options, we understand the challenges you may face, and that's why we've made it our mission to put you, our client, at the center of everything we do.Why a Client-Centric Approach MattersClient-centricity is more than just a buzzword; it's a philosophy that guides our every action and decision. We recognize that each individual has unique financial needs, goals, and circ*mstances. Cookie-cutter solutions simply don't work. That's why we take the time to get to know you, understand your specific situation, and tailor financial solutions that align with your objectives.Our Commitment to YouAt My Reverse Options, our commitment to client-centric financial solutions manifests in several key ways:Personalized Attention: When you work with us, you're not just another client. You're an individual with a unique financial story. We take the time to listen, learn, and tailor our recommendations to your needs. Whether you're considering a reverse mortgage or seeking financial advice, we provide personalized attention and solutions.Education and Empowerment: We believe that informed clients make the best decisions. That's why we're dedicated to educating you about your options. We provide you with the knowledge and tools you need to make informed choices about your financial future. Your empowerment is our goal.Transparency: Trust is the foundation of any successful client relationship. We are committed to transparency in all our interactions. You can count on us to provide clear, honest, and straightforward information about your options, fees, and potential outcomes.Ethical Practices: Our business is built on ethical principles. We adhere to industry regulations and prioritize your best interests. You can trust that we will always act in an ethical manner, putting your financial well-being above all else.Your Journey, Your WayWhen you choose My Reverse Options, you're not just choosing a financial service provider; you're choosing a partner on your financial journey. We understand that this journey is deeply personal, and we respect that. Whether you're looking to tap into your home equity with a reverse mortgage, plan for retirement, or navigate the intricacies of the financial world, we're here to support you.Get in TouchIf you're ready to experience the benefits of a client-centric approach to financial solutions, we invite you to reach out to us. Let's start a conversation about your unique financial needs and goals. Our team of experts is ready to provide you with comprehensive guidance, personalized solutions, and the support you deserve.

New Post: Why Is Money So Difficult to Manage? - Money and financial products can be challenging for the average person to understand. Some people find their financial situation so hard to navigate that they undertake courses and contact experts to help. However, it begs the question: why is money so hard to manage? Often, it’s for these reasons below:Why is money difficult to manageComplicated Payment TermsWhile some lenders have straightforward payment terms that are easy to understand, that’s not the case with all lenders and financial institutions. A financial product can look straightforward on the surface, but it can come with pages and pages of financial jargon that rarely makes sense to the average reader.Complicated payment terms can be problematic for people who don’t have excellent financial knowledge. Yet, financial and legal repercussions can sometimes occur if they fail to abide by the terms they agreed to.A Lack of Financial KnowledgeFinancial education, like budgeting and credit scores, isn’t often part of a standard school curriculum. If you don’t learn about money in the schooling system, you must learn about it in your own time. Sometimes, you also learn through making financial mistakes.A lack of financial knowledge can make money incredibly difficult to manage. You don’t always know about interest rates, the repercussions of not paying your bills on time, or just the basics of money like a savings bank account and your income versus expenses.Emotional FactorsWe don’t always spend money for logical reasons. Money is often linked to our emotions, like greed, jealousy, anxiety, and fear. When our judgment is clouded and our emotions are in play, we can make money decisions that may not be in our best interest.We may spend money out of jealousy for someone else having something we want. We might even make purchases when we’re sad. Our emotions can undoubtedly make managing money much harder.Balancing Long-Term Planning and Immediate NeedsLong-term financial planning can involve paying off a mortgage and saving for retirement. We know these tasks are important and can set us up for life. However, balancing these long-term goals with our immediate wants and needs can often be challenging. For example, you might want and need a new car, but know that the money you spend on a car would also help bring your mortgage balance down and save money on interest.Changes in Circ*mstancesMany Americans have admitted that they’re one paycheck away from homelessness. As many as 62% of Americans also have no savings to cover unexpected expenses like medical bills and car repairs.If you lose your job, have unexpected bills, or your income suddenly doesn’t cover your expenses, managing your finances becomes challenging. It’s not uncommon for some people to be unable to make their rent or mortgage payments and utilities before ultimately experiencing homelessness.A change in circ*mstances can als

🌟 Unlock Financial Freedom Today! 🌟 Are you ready to take control of your finances and build a secure future? Imagine having extra cash each month to create that much-needed emergency fund. I recently assisted a client in transforming their budget, helping them save significant money monthly. Now, it's your turn!✨ How I Can Help You: - Personalised Budgeting: Tailored strategies to fit your unique lifestyle. - Smart Saving Techniques: Learn to effortlessly put money aside. - Emergency Fund Building: Ensure a safety net for unexpected times.💡 Success Story: One of my customer, a savvy home owner who decided to take control of her finances and explore innovative ways to save money on her mortgage. After a consultation with me, she learned about the benefits of utilising an offset account.The customer had a home loan with a variable interest rate, was determined to find a solution to reduce the amount of interest she paid over time. She decided to redirect her savings into an offset account linked to her mortgage.By doing so, our customer not only safeguarded her emergency fund but also strategically reduced the interest payable on her home loan. The offset account allowed her savings to offset the outstanding balance of her loan, effectively reducing the interest charged. As a result, the customer found herself making significant strides in paying off her mortgage sooner than expected.What made this strategy even more appealing was the flexibility it provided. Our customer could access her savings whenever needed while enjoying the ongoing interest savings on her home loan. The financial peace of mind and the accelerated progress toward homeownership were tangible rewards for our customer.Through the simple act of redirecting her savings into an offset account, our customer turned her financial goals into a success story. Her story serves as a testament to the potential benefits of exploring creative financial solutions and making informed decisions to optimise savings and achieve long-term financial success.🚀 Your Next Steps: 1. **Reach Out:** Send me a message or book a consultation. 2. **Discover Solutions:** Let's explore customised strategies for your financial goals. 3. **Transform Your Finances:** Start saving and building a secure future today!📬 Contact Me Now:Laurance Yu M: 0436 840 293 E:[email protected]Don't let financial stress hold you back. Take action today, and let's build a brighter, more secure tomorrow together! 💪💰 #FinancialFreedom #BudgetingMagic #SecureYourFuture #homebuyingjourney

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𝗥𝗲𝗻𝘁 𝘃𝘀. 𝗢𝘄𝗻: 5 Financial Factors Young Professionals Should Consider 🏠💰5 financial techniques to make the best choice:𝗧𝗲𝗰𝗵𝗻𝗶𝗾𝘂𝗲 #𝟭: Assess Your Financial HealthHow it works:Check your credit score: A good credit score is crucial for securing a mortgage with favorable interest rates.Analyze your debt-to-income ratio: Lenders assess this to determine your ability to manage monthly payments. Aim for a lower ratio.Evaluate your savings: Consider your down payment, closing costs, and emergency funds.This simple technique gives you a clear picture of your financial readiness for homeownership.𝗧𝗲𝗰𝗵𝗻𝗶𝗾𝘂𝗲 #𝟮: Crunch the NumbersHow it works:Compare rental costs with potential mortgage payments: Factor in not just rent but also utilities, renter's insurance, and potential rent increases.Estimate homeownership costs: Include mortgage payments, property taxes, homeowner's insurance, and potential maintenance expenses.Project long-term costs and appreciation: Consider how long you plan to stay in the area and the potential for property value growth.Quick note: Don't solely focus on monthly costs. Consider the long-term financial implications and potential return on investment.𝗧𝗲𝗰𝗵𝗻𝗶𝗾𝘂𝗲 #𝟯: Lifestyle and FlexibilityHow it works:Avoid: Committing to homeownership if you value flexibility and anticipate career changes or relocation in the near future.Do: Choose renting if you prefer a low-maintenance lifestyle and want to avoid the responsibilities of homeownership.By prioritizing lifestyle needs, you avoid being tied down and maintain the freedom to adapt to changing circ*mstances.𝗧𝗲𝗰𝗵𝗻𝗶𝗾𝘂𝗲 #𝟰: Investment PotentialHow it works:Research the local real estate market: Understand trends, property values, and potential for appreciation.Consider alternative investments: Evaluate the potential returns of investing your down payment in stocks, bonds, or other assets.Think long-term: Real estate can be a valuable asset, but it's essential to analyze its performance compared to other investment options.Do these 3 things, and you'll gain a clearer understanding of your investment options and potential returns.𝗧𝗲𝗰𝗵𝗻𝗶𝗾𝘂𝗲 #𝟱: Seek Expert AdviceHow it works:Consult a financial advisor: Get personalized guidance based on your unique financial situation.Talk to a realtor: Understand the local housing market and explore available options.Connect with homeowners: Gain insights into the realities and challenges of homeownership.That’s it!Let me know which of these techniques you found most helpful in the comments. Happy to do another post going into more depth on whichever one you find most interesting.#TechnicalAnalysis#FundamentalAnalysis#Stocks#stockmarketforbeginners#wealthcreation#linecharts#barcharts#personalfinance

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‼️The reason why you are not achieving your financial goals as fast as you want to‼️Do you want to know why you are not making financial progress as fast as you think you should? I’ll tell you the reason: it’s a lack of strategy or you simply don’t have one. Yes you have a KiwiSaver, yet you probably don’t even know what type of fund you are in or who your provider. Do you know the 5 and 10 year returns that your KiwiSaver has generated? No idea? I thought so. You have a mortgage and you are probably paying $20 more than the minimum but you have no clue what impact you are making. Hence as soon as there is an obstacle you are likely to stop paying extra. You are earning really good income and you are amazing at your job, yet it feels like you are living from paycheck to pay check. Where does all the money go? You ask yourself.You would love to achieve financial independence but you have got no clue how much money you will need or how much of investments you should have. You want to experience more travel, help your child with a deposit for their first home and work on your own terms but you don’t know how to achieve that. Here is what won’t work:⁃you investing randomly in Sharesies /ETFs/Low index funds⁃Saving money ⁃Just growing your income so you can earn more ⁃Paying $50 more a week towards the mortgage ⁃Talking about the “next great idea”⁃Justifying your lack of action because “we have a recession”Sure doing just one of these steps will make a small impact but it won’t get the dream life you want. Random actions will still have you left unfulfilled financially. Guys, I see this all the time. You need a cohesive strategy. And you need a professional who can design one for you AND help you IMPLEMENT it. This strategy has to be affordable and sustainable for YOU and your partner. It has to match your risk tolerance and risk capacity. You need to be able to sleep well at night not stressing about everything that can go wrong. The right strategy needs to maximise your resources. And This is what I do every day. Do you want to simply talk about what would be the right strategy for you? Let me show you in a couple of hours how instead of treading water you can turbocharge your financial progress despite what the economy is doing.

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Financial advice – Is it worth it? 🤔 To learn how our advice and this image has had a really significant impact on our clients, read on: Our clients are 50, both work FT, have one child about to leave the nest and a $350,000 mortgage. 👨👩👧🏡 Seeing as they are so close to life after work, our onboarding process focused on what their ideal vision for retirement looked like if they could write the script:🟠 How much longer would they like to work?🟠 Where would they like to live?🟠 How much travel would they like to do?🟠 To what extent would they like to support their child and future grandchildren? We completed our research and came to a conclusion we regularly see in our office – Our clients were being too humble! You can imagine how fun it was to present this picture and our findings to the clients:✅ They could retire much sooner,✅ They didn’t need to downsize their home,✅ They could comfortably increase their budget and travel by 25%,✅ They could provide extensive support to their child without impacting their own quality of life. If you have questions about your own ideal vision for your retirement, maybe it’s time we had a coffee? ☕️☕️ ++++++++++++++++++++++++++++++++This information is general in nature and does not consider your personal objectives, financial situation or needs.Because of this, you should, before acting on the information, consider its appropriateness, having regard to your personal objectives, financial situation and needs.

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"True financial freedom is not about how much money you have, it’s about having the freedom to make choices without financial constraints."The word F.I.R.E had a greater emphasis in the movie “Pushpa” and second in the financial planning world, where people evaluate financial freedom or retirement from work to follow their hobbies, travel, focus on health, social work etc.F.I.R.E no by calculation is 25 times one’s annual living costs + factor of inflation and, with this, it seems to be a Hercules and a very long term task. Also one can't factor the uncertainty which is evident as it will require enough years to meet this value by depending on salary.Also, to meet the desired savings of such a high amount, one would need to save 40% to 60% of its annual income, which is not a feasible as we see a majority of our population live hand-to-mouth. Also, to follow such a kind of consistent investing for a long period requires discipline, which is very difficult to find in today’s world.I would propose people to focus on the small but important things and so to avoid stress of micro-managing financial activities.a.Encourage monthly investment: It helps one to commit a small portion of salary. After couple of months one will get accustomed to this habit and will naturally plan their budget with the amount left after saving.b.Avoid monthly payouts (expect home loan, car loan & education loan) : Nowadays, when ZERO EMI is a new normal, people tend to follow impulsive purchase, and then It's difficult to come out of this loop like taking a I-phone followed with watch, ear buds, leisure travel etc. By doing this the monthly payout will be erratic and will struggle to plan finances.c.Try to pay out the things below in single transaction as it will help you to avoid one new and disproportionate expense each month. People being such occupied with daily routine may tend to miss an important payout and it would be a concern in case of your insurance where it may get disqualified and one may loose the benefit which were acquired over periodi)School fees of kidsii) Monthly groceriesiii)Society maintenanceiv)Any insurance i.e. term, medical, LIC etcToday’s world is full of information, distractions and uncertainty, which in turn requires simpler and sustainable financial habits to have a sense of satisfaction and to focus on other things like to upskill, exercise, develop a hobby and most important spending quality time with your family.#financialfreedom #financialplaning 7

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