We've all been there, at one time or another. We pick up a cheque from the agency, we put it in our bank account, the world's looking rosy. We call some friends, we have lunch, we go shopping, we work some more, we take a trip, we get the Louboutins, and then we look at our back account. What the heck happened? Where did the money go? Didn't I just make X?
Trust me, I've been there. Even during times when I had "financial intelligence", the lure of good times and the knowledge that "I'd make more" made me look like a financial dummy on paper.
In fact, I was smarter when I was 14. I had a great summer/fall job at a country club, and my mom sat me down with a financial consultant. Together, we worked out a plan that would ultimately pay for my university education, allow me to have as much fun as I wanted, and then afford me the luxury of moving to London when I graduated, where I then squandered the rest of it. It was a real eye-opener; I lost track of my financial plan, and man, did it hurt. I was working regularly, the world was my proverbial oyster and I was getting into debt.
One day, I got a call from my old financial consultant, who wanted to touch base and find out how things were going. I was honest. So was he. I remember his words well: "Liam, you're blowing it." He reminded me that one of my goals was to attend grad school within the next 2 years. "Oh yeah..." was my reply. His advice? Get in touch with a friend of his, who was also a financial consultant in the UK. Just like that, I had a new consultant, and a new financial plan. I kept working, and from that point on, I always made sure to "Pay Myself First."
And for the record, I attended the University of London, and completed my Masters.
The concept of "Pay Yourself First" is, in my opinion, one of the most important things you can ever be introduced to. Over the next few months, I'll be discussing a number of topics that relate directly to holistic financial planning: the importance of starting early; the importance of identifying your goals; what is my "profile?"; how do I protect my single biggest asset?; why a cup of coffee is worth $1,000,000; how to deal with, and reduce, taxes.
I'm calling this series of articles "Financial Rehab". I mean, we all put a tremendous amount of time and effort into eating the right things, drinking enough water, exercising, looking good every day & running ourselves as a business; are you paying enough attention to the end result and bottom line, or do you need to check yourself into the clinic?
Liam Hendrikse is an independent financial advisor, and a model with Sutherland Models. He provides 1st and 2nd opinions on new and existing personal financial plans. He's also a forensic scientist, but that's another story altogether...
This is intended as a general source of information only and is not intended to provide any personalized tax, legal or investment advice, and is not intended as a solicitation to purchase securities. Liam Hendrikse is solely responsible for its content.