This DOAC podcast episode will change how you think about your financial future
Now, I listen to a lot of podcasts, and most are interesting. And occasionally I find one I can't stop thinking about.
Like this one, Dave Bach the multi best-selling wealth author, on Diary of a CEO with Steven Bartlett.
It stopped me in my tracks because it’s everything I teach my clients - and hearing someone else say it - someone with his track record and reach - made me want to shout it from the rooftops.
Here’s what really hit me
Most people who are living paycheck to paycheck don't have savings. But NOT because they don't earn enough. Dave Bach's research says it’s because they never automated it.
They kept waiting to see what was left over at the end of the month.
You MUST pay Future You first. On a standing order. On the day you pay yourself. Before you pay anything else.
Just do that one thing.
Because automatic savings, not budgeting, are the key to your financial freedom.
And this goes for your business too. Don’t make the classic mistake of waiting to see how much profit you’ve got at year end to make your pension contribution.
Decide up front how much you’re investing every year, build your budget around it, make your business afford it, and set up a monthly standing order.
The cost of unconscious spending
He also talked about the maths on unconscious spending; the average person wastes £10k a year. Not on big things, but on daily coffees, takeaways, subscriptions they forgot they had, and all those Amazon must-have purchases!.
But if you invested that £10k every year for 10 years instead:
In 10 years you’d have £152k. In 20 years: £359k. In 30 years a staggering £851k.
30 years sounds like ages, BUT time goes so fast, and one day you’d be so incredibly grateful you invested intentionally, instead of spending mindlessly.
I qualify any spending I make - to decide, on purpose, if it belongs in my financial life. Even seemingly small amounts. And I work out the 1 year and 10 year cost.
I usually shock myself!
Like that £20 monthly subscription you barely use could be worth £3.8k in 10 years if you invested it instead.
Boring wins over sexy!
The other thing he said that I loved; boring investments win. The people chasing sexy returns, the crypto bros, the get-rich-quick schemes, they tend to end up broke.
Whereas a boring old global index fund quietly earns 9%+ a year.
This is exactly why I don't help business owners gamble on an exit.
Why I bang on about building your wealth month by month, consistently, through the business you've already got.
Consistent, predictable profit going into your pension. The boring, reliable, compounding kind of wealth.
Not the lottery ticket version.
In business we can get programmed to believe that we need to be extraordinary, take huge risks, scale our businesses.
But very ordinary people on average incomes can become millionaires and financially independent by quietly investing, automatically, every month. And leaving it the hell alone!
One more thing from the episode that stayed with me. He said wealth is a mindset game and that there’s unlimited potential to earn more.
And that the next 10 years will be the greatest opportunity to build wealth in our lifetime so it really is time to get those savings automated right now.
So I’d strongly recommend this episode; you’ll learn something that could change your life!
Then set up that standing order for your monthly savings - Future You will love you for it😍