“Pay Yourself First“…this is a vital ingredient in the recipe to gain financial freedom, state many of the most respected authors on the subject – Robert Kiyosaki, Donald Trump, & Elisabeth Donati, to name my 3 favorites. To those of us whose income fails to accomplish all we need it to in the month anyway, paying ourselves at all, let alone first, simply adds to the pile of bills we are already struggling to meet.
“Can I pay myself first by going to the grocery store on the first day of the month?” I wondered only partly in jest.
“If I pay myself first, where do I take that money from?”
If you pay your expenses first any money that might be available to save gets spent–sometimes you know not where! Most of us don’t really know where our money goes, even if we track it by dutifully writing down all our purchases. I have done that for years and still I have been left wondering how I could have spent all that money. Everything I bought seemed so essential.
The idea behind paying yourself first is that if you find there is not enough to meet your expenses you will be forced to 1) Cut those expenses, or, better according to Kiyosaki, 2) Find a way to make up the shortfall. He claims that we become more creative when we are put in this situation.
I don’t know about you, but when I first read this my reaction was to scream, “How on earth am I supposed to create more money in a month? Jobs don’t just appear like magic especially in this economy, and when do I have time for another job; I already have three!” All through my Creative Wealth training with Elisabeth in February, I whined about this, but I listened, and I kept reading. I knew that if I wanted to be financially free I had to be a different me.
The key is in a change of mindset. “What you think about you bring about” – so I started thinking differently.
First of all, I knew that if I was going to teach financial literacy I needed to educate myself around the topics I was going to be exploring with the students. Secondly, I knew that when the kids asked me what I was doing to become financially free, I could not and would not lie, and was not going to have to tell them “nothing…yet”. To be a great coach, I not only had to talk the talk, but I had to walk the walk.
I found some jars gathering dust in the garage, washed them, and began by putting just one dollar in each: Living, Financial Freedom, Savings, Education, Play, & Donation. This was liberating! My jars now proudly boast over $25 each in less than a month. Not bad for someone with way more month than money!
BUT, I hear you cry, how did you pay your bills?
That’s the next part of the story…first start your jars.
Even though many of us don’t use physical checks for personal use much anymore these days, we all write them once in a while. Some people still use them as they always have. Especially businesses.
Writing checks is one of the activities that our attendees of Camp Millionaire always seem to love to do, and they learn how to write things in a register when they play The Money Game during camp all week. It’s great when they learn but don’t know they are learning. That is the best!
In keeping with the idea that kids (of all ages) learn great with fun little videos, here’s one I found on what happens with a check once it’s written. Sit down and watch it with your younger kids (or older ones if you have to pay them!). Enjoy…
So there’s a lot of ‘bad’ news in the news these days. Do you buy it? Literally…do you buy it and when you buy it, are you buying IT with cash or with credit? In other words, are you using YOUR money or someone else’s money? This is how we have gotten into the financial mess we’re in right now…using other people’s money.
Now we’ve almost all done it; used a credit card to buy something we couldn’t afford just yet. I’ve done it. We’ve had this example set for us by Uncle Sam (our favorite uncle) who is trillions of dollars in debt but it doesn’t seem to stop him from spending money he doesn’t have. But that’s a whole other post!
I have watched this movie before and even though it is long (it’s an actual movie), I highly suggest you sit down with your whole family (kids 8 and up will probably get it) and watch it. Then, when you’re finished watching it, have a conversation about it.
As your children questions: What does this mean? How does this work? How is this a bad thing? How is this a good thing? What do you think of this? Just let them explore their feelings and thoughts about it.
Anyway, enough of me. Just watch the movie and learn. The more you learn about money and debt the more educated your choices can be now, and in the future. Enjoy…
Along our journey through childhood, we made decisions about ourselves that limit our possibilities instead of enhance them. It’s only when we’re very mature adults that we realize that we generally get what we argue for in life.
As a parent, your job is to empower your children; teach them to sing, and fly and take care of themselves in all ways. Yet, for whatever reason, we don’t always succeed at this task. Probably because most of us didn’t take ‘Child Empowerment 101” in high school or college!
To understand how we talk about ourselves, you need to listen to yourself, and your children talk. Have you ever heard yourself, or your children say,
I’m not that type of person.
I could never do that.
I don’t understand those types of things.
I never have the energy for that activity.
I can never figure that out.
I can’t do that because—” fill in the blank.
If you have, you’re not alone. The questions are: Why are you limiting yourself? Where did you learn to do this? and, Are you teaching your children to do this to themselves as well?
There’s a saying that goes like this… “If you argue for your limitations, they are yours!”
The fact is, we all have ‘beliefs’ about who we are, what we can do, what skills and talents we have or don’t have, what we think we should or shouldn’t be doing. Most often, the beliefs people have about their own limitations aren’t even theirs. They took them on from someone else: parents, relatives, friends, neighbors, teachers, the media. And the younger they were when they took on the belief, the deeper in their subconscious the belief resides and the more of an autopilot type the belief is for that person.
This is why ‘change’ for most people is so difficult. The change has to happen at the unconscious, belief level and our minds keep us hidden from the face that they are just beliefs in the first place. Many human beings not only don’t understand this concept but have no idea where to look for the beliefs that are holding them back.
The most important aspects of limiting beliefs is simply to recognize that:
1) We all have them.
2) They are rarely true or backed up by substantial evidence.
If you really want to change something in your life, you must first uncover the beliefs that are controlling the behavior you want to change. And if you want to make sure your children grow up thinking and knowing they can achieve anything they wish in life, you must instill that belief in them from a very young age.
One of the simplest ways to recognize you are operating under a deeply instilled belief is to watch how others respond to you when you speak or do things. If they look at you with that, “Why are they doing (or not doing) that?” you may have just discovered a belief about yourself or life that others don’t necessarily agree with. It’s not that you are wrong and they are right; it’s that this behavior is an indicator that an unconscious belief may be working you in a way you might want to examine.
Once you discover a limiting belief, how do you change it? First, you must develop that awareness that you have them and second, you have to recognize them as what they are: beliefs and not reality. Recognizing them is both easy and hard.
We’re all so used to just saying the same old statements about ourselves, out loud and inside our head, that we don’t really ‘hear’ what we’re saying. And yet, if you just take a moment to set an intention of listening to the things you say about yourself for a day, you may start to ‘hear’ those limiting beliefs come out of your mouth. Hopefully they will surprise you!
Once you, or your children, start to have an awareness of some limiting belief, you can go through these questions to help determine if they have you on autopilot, are limiting your potential or controlling you in some other way. I do suggest writing both the questions and your answers down on paper:
Is it really true?
Who said it was true?
What would I do if it wasn’t true?
Did the answer to number 3 bring up any fears that you didn’t realize you had?
When you’re done answering these four questions, you will probably realize that, first, the belief really isn’t yours and second, if you developed a different belief about that particular aspect of yourself or your life, you might be able to do the most amazingly powerful things in and with your life; things you never dreamed you could do.
OK, you have your assignment. Listen to your words for a day and see where you and your children are limiting yourself. Remember, we are only limited by our own limitations. Convince yourself you have them and you will. Decide you don’t and you won’t. Just imagine the possibilities!
If I get one question consistently, it’s the simple question, “What’s the best way to teach my kids about money?” I have a simple answer.
First, do whatever you can to make it their idea. I call this using “Teachable Moments” to introduce financial education, or anything else for that matter, to your kids.
Here is a section from The Ultimate Allowance to help you with those teachable moments.
As adults and parents, most of us realize that, in life, there are teachable moments when we are open and receptive to relevant information, and there are moments when it doesn’t matter who is attempting to teach us, we are simply not willing, or able, to take in the information.
Children are no different. You probably know that sometimes it’s just flat out impossible to get your kids to learn something (or even listen) as long as you are the one who is doing the teaching. But have a friend introduce an idea or concept to them and they are open and receptive to the information.
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With the Ultimate Allowance, you will be the one introducing the program, walking your child through it and helping her every step of the way as she learns how to master this money game thing through trial and error. Therefore, it is critical that you introduce it correctly, and at the best possible moment.
First, find a time when it makes sense to bring it up. Right after they’ve had a fight with a friend or lost a valuable toy or broken a vase is not that time! I’ve heard it said that people don’t change until the pain of change is less than the pain of staying the same. Watch for a time when your child has had, or is about to have, an experience involving money. It can be either a positive or negative experience; you never can tell when a child will be receptive to new information.
When you’re deciding on the perfect time to introduce this system, here are two questions you might ask yourself first:
1. Is what I want to talk about with my child relevant to the current situation?
2. Will the information I’m about to present provide a solution to a problem or situation my child is experiencing?
If the answer to these questions is Yes, then you probably have a teachable moment on your hands.
James Jordan, the brains behind Educate Project based in Los Angeles, CA has asked Creative Wealth Intl., LLC to create their signature financial literacy program using our amazing Money Game program tailored as an after school program. For more info, check out EducateProject.com
The idea behind paying yourself first is that if you find there is not enough to meet your expenses you will be forced to 1) Cut those expenses, or, better according to Kiyosaki, 2) Find a way to make up the shortfall. He claims that we become more creative when we are put in this situation.