One simple statement changed my financial life.
Many people say they want to be rich. I was one of them. However, I was saddled with debt and faced a common dilemma—I didn’t have a clue where to begin.
That’s when I created a phrase that transformed my life from potential financial ruin to one of financial riches. When I began my financial journey I called it my Debt Motivation Statement. However, as soon as I paid off all my consumer debt and my mortgage, it transformed into a Wealth Motivation Statement.
Creating a Wealth Motivation Statement allowed me to stay on course and pay off over $70,000 of consumer debt in less than three years. It also encouraged me to pay off over $320,000 owed on my home in 12 years, and it helped my husband and I go from a negative six-figure net worth to a seven-figure net worth.
If you don’t like your current financial situation, you have the power to change it. As a wealth coach and author of 7 Steps to Get Out of Debt and Build Wealth, I’ve coached clients into their own successes using these same tactics. Here’s how I did it—and how you can, too.
Start with your 'why'
When you begin to move toward financial independence you need to determine why you’re embarking on that journey.
If you are heavily in debt, ask yourself this question:
"Why have I decided to get out of debt?"
If you are debt-free and want to amass life-changing wealth, ask yourself:
"Why have I decided to build wealth?"
When I pose this question to my clients I advise them to focus on something they absolutely love. Their answers can range from having the option of quitting their day job so they can work at their dream job; being able to spend more time with their growing family by becoming a full-time stay-at-home parent; turning their hobby into a full-fledged business; having the financial means to travel anywhere in the world; buying their first home or their dream home; or attaining financial independence so they can choose to follow their life’s passion.
Refine your statement and think about the big picture.
Once you have figured out your “why,” ask yourself these additional questions:
— What hobby or activity do I participate in that absolutely charges me up, and results in me losing track of time whenever I pursue it?
— What one thing do I want to pursue in my life, and would pursue if there were no obstacles in my way?
— What legacy do I want to leave?
— What do I want out of life?
— What kind of lifestyle do I want to live?
These are tough questions, but the answers can help you redirect the energy you’re spending worrying over your debt into activities that give you energy to pay off your debt.
Real wealth is not just about having money, but is also about having the option to do the things you enjoy. I call this “Spend Passion Cut Junk”—spend time and money on your passion, and cut out the junk. Maybe your passion includes investing in appreciating assets, such as blue-chip stocks, and maybe your junk entails spending money on depreciating assets such as vehicles. This will vary for everyone. Find ways to spend more money on your passion, and less money on your junk.
Finalize your statement.
Here are some concrete steps you can execute immediately to solidify your Wealth Motivation Statement:
- Write down the things in your life that motivate you, and things that describe why you are embarking on the journey to financial independence.
- Narrow the list to the top five most important items.
- Cut the list again to your top two most important items.
- Next, ask yourself, "What one thing do I need in order to be fulfilled?" and select that one motivator from your list.
Now that you have narrowed your list to the one thing that motivates you, this will form the basis of your Wealth Motivation Statement.
Here is an example of a Wealth Motivation Statement: “I will pay off my debt and attain financial independence so I can pursue my passion in the creative arts, which includes creating music and paintings.”
Determining your statement will help you pinpoint what energizes and motivates you, and gets you in the right mindset to achieve your goals. It requires you to find the one thing you want in your life that you are willing to make huge sacrifices for in order to attain.
My own statement included “being completely debt free and attaining financial freedom so I would never have to rely on a creditor or employer for my financial future.”
Create a daily reminder.
Write your statement on a Post-It note and stick it in a high-traffic location in your home. Make sure to read the note each time you walk by.
If you want to take this strategy one step further—as I did—you can create a vision board that acts as a visual reminder of why you are pursuing your goal of financial independence. Include photos of the items that remind you why you are seeking a richer life. Maybe they’re photos of exotic travel locations, a new home, or whatever gets you focused on your future.
I credit this simple statement for making me rich, and for allowing me to live the life I have always wanted to live. Grab a pen and paper, and start creating a richer version of yourself.