Financial Mistake #10a - What NOT To Do With Your Cash
This is the 10th Mistake in the "13 Financial Blunders Newly Successful Internet Entrepreneurs Almost ALWAYS Make" series.
10a) What NOT To Do With Your Cash: Personal Expenses Greater Than You Can Support
When you are not making Financial Mistake #9 and you are extracting cash, and lots of it, from your business into your personal life. That's when a whole other HUGE mistake appears.
This one can look a number of different ways and usually goes hand in hand with Mistake #1 of Future Spending.
Some people might be "keeping up with the Jones", others might have a "gadget addiction", others flat out have an "inflated ego" and focus on extravagant living.
But it all boils down to the same thing, creating a lifestyle that is beyond your means.
Let's analyze each one and see if it describes you…
Keeping up with the Jones': This has become a major problem in the US. Instead of being grateful for what you have (but still that entrepreneurial drive to achieve more), you instead take for granted what you have, always want more more more and take the next step and keep your lifestyle a step or two above where it realistically should be.
The truth is, we have become a culture addicted to consumption. We get a thrill off buying that next thing, even though we grow tired of it days later.
That leads to…
Gadget Addiction: You have to have the next cool thing from cell phones, to clothes, luggage, TVs, furniture, accessories, shoes and the list goes on. Even if you don't need it, won't realistically use it and it's crazy for your level of income to spend on it.
I have a $15,000 piece of exercise equipment sitting in my garage that I haven't used in over a year. (I instead work out every morning with a $25 tool.)
And then the final one…
Inflated Ego: And your extravagant standard of living. You think you deserve the best from food, travel, house, car and more. Nothing wrong with believing we deserve the best in life. I 100% believe that. But we only deserve it once we earned it! Not because we woke up one day, after seeing a little success, and think we rule the world now.
Instead of letting your ego control your financial life, let your results to produce financial results control your financial life. It's time to earn what we desire instead of feeling we are entitled to it.
In the next post we will look at what TO DO with the cash you are extracting from your business.
business advice, entrepreneur, financial advice, financial mistakes, future spending, gadget addiction
Comments
November 10, 2007
Jawed Iqbal said:
"live within your means"….seems common sense, but nobody follows it these days.
Jackie Lange said:
It's not the high cost of living, it's the cost of living high that is causing so many financial problems these days.
Jackie@CREWealth.com