Pay Yourself First

One of the best lessons I learned from my financial journey is how to pay myself first. Well, actually, to be more accurate, it's "pay back to God" first by tithing, then myself second. But for the purpose of this post -- let's talk about setting aside and not touching our earnings for our savings and investments first, then live on what's left of our income for our other expenses. As opposed to spending our hard-earned money paying our bills and buying stuff, then saving what's left of it (if there is something left that is).

Why It's Important to Pay Yourself First

I was taught at a young age that I should not be selfish and greedy. Being the eldest, I learned how to share and be generous with what I have and to put the needs of others first before my own. It comes naturally to let other people pass before me; stop what I'm doing to be of assistance; and to put aside what I want if it means not being a burden to other people. I didn't see anything wrong with it, in fact, this characteristic of mine is often praised by others.

As I grew older, I felt that I have allowed myself to be available and generous for everyone but myself. As much as I highly treasured my friends and family, I have nothing to give myself but cutting words that hurts too deep. I spent so much time in making sure that I please everyone, but I failed to spend time making myself feel good. Ultimately, it brought me to a breaking point and I found myself lost and drained of life.

Now, I am making it a point to be generous with myself and not feel guilty with prioritizing myself first. I learned that when I invest in making myself feel good, this translates to my outside world as well. My relationship with other people is much richer and fuller now than my half-assed attempts before. In the end, everyone benefits. 

The Concept of Paying Yourself First

"Paying yourself first" means that when you receive your salaries, you allocate a certain percentage to your savings and investments first, and make sure that you do not use this money for any other expenses other than what you have saved it for -- your future self.

Let's say your goal in saving money is to have an Emergency Fund. Then one day, the latest iPhone 5 was launched and you wanted to buy one. However, you found yourself short of cash and you've used up all your credit card limit. Even if you are itching to touch your savings -- DON'T. Stop eyeing your savings and just put off buying that iPhone 5, until you have the money to buy one, because purchasing this latest gadget is not an emergency but a luxury. You have to remind yourself that the reason why you're saving is because you want to have a cushion for yourself for emergencies such as job loss or illness.

Ultimately, this is what paying yourself first means for me. You give priority to what you value most in your life. You invest in your needs first, not wants.

A Paradigm Shift

Moreover, paying ourselves first doesn't only benefit us but others as well. In my experience, paying myself first caused a paradigm shift in me that translates and affects my way of living. And I believe that this can also happen to those who practice paying themselves first.

Financial Security. Safety and security is the second basic needs of human beings, according to Maslow's Hierarchy of Needs. When we have savings, we have something for rainy days. There is a sense of security that even if an unforeseen event strikes -- like losing a job or someone in your family needs medical care -- you know you have savings to fall back on. This sense of financial security lessens our anxiety and helps us have a more positive over-all feeling.

Abundance Mindset. As we see our savings grow, we have a concrete visual of abundance in our lives. As we are continually exposed to this financial abundance, our focus is being shifted from lack to abundance. The Law of the Universe says that "the more we focus on a particular idea or thought, then we will attract more of this idea or thought". This means that the more we focus on abundance, the more abundance we will attract in our lives -- not only financially but in all areas of our lives as well.

Natural Giving. When you pay yourself first, what you are really practicing is generosity. Although you are starting to be generous towards yourself at first, as this becomes a habit, you will find yourself being more generous towards other people as well. It's just the joy and the fulfillment in giving that will move us into becoming natural givers, I believe. And for me, this is the most rewarding of all because I am able to be a blessing for others as much as I am blessed.

These are just some of the paradigm shifts that I have experienced by practicing paying myself first. I'm sure there are others more. If you are already practicing this, I would love to hear how paying yourself first changed your life! =)

On my next post, I will share with you the methods I use in paying myself first.

Praying for your happiness,
Joanne

New Page Launched: Lessons from My Financial Journey

16 October 2010 -- In my "How to be Financially Free: Introduction" post, I have made a rather daring proclamation that I will achieve financial freedom in the near future. I also declared in that post that I will chronicle this journey in my "How to be Financially Free" series.

A "how-to" series seems a little daunting because it kinda gives off the impression that this will be an instructional series. That I have some sort of expertise on the matter, in which others could follow and expect to succeed.

I don't really consider myself as a teacher and I definitely don't have the expertise to teach anyone just yet. With this, I came up with a more appropriate title for this series of mine -- Lessons from My Financial Journey. I believe that this captures more accurately my purpose for writing this series (and really my purpose for this blog). I wanted to share my stories and journeys in hopes that through my sharing, others will be blessed. That they can take away something from my personal stories and apply into their lives as they see fit.

"Lessons from My Financial Journey" is where I share my own personal journey towards financial freedom. Here is where I hope to share what I have learned from books, mentors, articles, and most importantly, from being a member of the Truly Rich Club. Here is where I will share the steps I have taken, am taking, and will be taking as I embark on my journey to being financially free.

My hope and prayer is that as you read my posts in this series, you will also be moved to start your own journey towards financial freedom. For you, I pray a life free of debts; a life free of financial worries; a life free of financial limitations. For you, I pray a life full of generosity and charity; a life full of giving; a life full of blessings received and blessings shared. Amen!

Now on to the posts! ;)

How I Became Financially Free: My Emotional Why

Last month, through my "How I Became Financially Free: Introduction" entry, I made a (daring) proclamation that I will achieve financial freedom in the near future. I also shared how God prepared my way, from being a person who lacks hope, purpose, and worth to a person who is now filled with so much hope, purpose and worth.

I am now full of hope that one day I will be fully healed from my past demons; that one day I will be free of my worries about the future; and that one day I will be financially free. Moreover, a part of the purpose that I have been searching my whole life is now revealed to me: one of my life missions is to share my stories and learning in life through my writing. But the most important thing is that I am now learning to believe in, value, accept, and embrace my worth. I am now loving myself more and more each day.

For this entry, let me now share to you the reasons why I want to be financially free.

The Emotional Why

One of the blessings I regularly receive from being a member of Bo Sanchez' Truly Rich Club are Bo's PowerTalk mp3s.And one of his talk is about how to find our emotional why. But first, what is this emotional why anyway? And why is it so important to find out our emotional why?

In the simplest terms, emotional why is the hunger, the desire, that fuels us to do something. Our emotional why is what drives us to strive for something. This is one of the defining factors of whether we are going to achieve our goals or not. Let's face it, most - if not all - of us want to be successful in life. But how come not all of us attain great success? How come some, despite their desire to become successful, settle for mediocrity? The answer to that is because the level of one's emotional why differs from others. And as Bo said, the bigger and more powerful our emotional why, the greater is our motivation to achieve our goals.

The more powerful our emotional why, the greater is our motivation to achieve our goals. -Bo Sanchez, Find Your Emotional Why

My Frustrations

According to Bo, our emotional why has two parts: frustration and fantasy. Most often than not, we are driven by our frustrations in life. The pain they cause, the pain of facing every day with these frustrations staring at us, is usually the reason why we finally tell ourselves, "Enough is enough! There has to be something that I can do to make this pain go away!"

For me, there are a number of instances that bring me pain and frustration that made me want to have lots of money. Whenever I am reminded of these reasons, whenever these situations haunt me, it brings me too much pain. I just feel so helpless and guilty and just damn angry that I cannot do anything at the moment to remedy the situation. Top in my list are the following:

1. Being in debt to our relatives.

2. Being a burden to someone, and having to depend on them just so I can have what I need and want, even the basic stuff.

3. Not being able to help someone in need of financial assistance just because I don't have enough with me.

I've had these "pains" with me for a long time now. But amazingly enough, I was not pushed well into my limits just yet. I'm thinking it may be because deep down, I am such a masochist. Kidding! But really, I think it is because I have associated with pain long enough for it to be a successful driving force for me. And besides, the sad thing about pain is that it can either push you into action or paralyze you with feelings of inadequacy. And not all people can find the courage to push through their pain to achieve what they want. 

My Fantasy

I was reading West Loh's and Andrew Grant's The Money Mindset Report. One of the exercises there is for me to imagine myself receiving 1 Million USD, and to list down what I will do with that money. Now that's a lot of money! I remember when I first did it, I was dividing my 1M Pesos into my five funds plus an additional funding for my "send-a-kid-to-school" dream. Then it hit me that, hey, there is a million dollars (and not just pesos) for me to divide! I was having the time of my life writing down how much money will go where and thinking of the different things that I want to spend my money into, not only for myself, but for my family and friends as well. 

Finally, I can pay our debt to our relatives! I can treat my family to a vacation outside the country. I can buy what I've always wanted: laptop, digital SLR camera, and my own home office station. I can buy all the books I want. I can go to MOA and ice skate all I want. I can finally go to the countries I so very much want to visit. I can grow my stock portfolio. I can buy a condo and lease it out....But most importantly, I can finally realize my one unchanging dream: to send kids to school. I can have more than enough money to be a sponsor in my Alma Mater's scholarship foundation, and more than enough to finance a foundation that is geared towards sending out-of-school youths to school. I can see it in my mind's eyes and I just can't wait for that day to come!

When Lyf Throws U Lessons

This fantasy of mine brought such intense feeling within me. And I think that this is why, more than our frustration, our fantasy plays a bigger part in our desire to achieve whatever we want. We often hear coaches and trainers, and motivational speakers and writers saying that we should not focus on the pain, we should focus on the gain. Same thing, we should focus on our fantasy and not just in our frustration.

Yes, frustration has its part in our hunger to change. Without the pain, then we won't know that there is something in our lives that is not right. But we should be able to overcome this pain and shift our focus to why we want to make the change in the first place. Think of all the things you can do once you have attained your goals. This gives us something to look forward to, especially since our journey to making changes in our lives is surely not going to be easy. 

How about you? What keeps you going? What is your emotional why? If you still don't have one, then dig deep and find it. Once you determine it, then you are one step away from achieving your dreams.

Praying for your happiness,

Joanne

How I Became Financially Free: Introduction

"Lord, thank You for giving me the opportunity to achieve financial freedom. I am so looking forward to investing on my future. I can't believe it. My future...MY FUTURE! Before, I wouldn't even think nor dream of reaching my 20's, but now I am looking forward to reaching my 40's -- the time when I would become a millionaire and the time when I can finally fulfill my one unchanging dream: I can finally help others to receive the education they deserve by paying for their schooling! Not only that, but I can finally treat my parents and give back to them (in a way) what they have given me; something to show my gratitude and love for them. And most importantly, I can finally give myself what I truly deserve -- financial freedom!"

~excerpt, journal entry, 15 September 2010

Hi! My name is Joanne. I am 24 years old. March of this year, I received my Bachelor's Degree in Hotel and Restaurant Management. Not many know this, but one of the biggest frustrations I have in life is my lack of goals and dreams. Yes, I have a general idea on what I want to achieve before I die: to fulfill my purpose in life. Problem lies with what exactly that purpose is. I guess before I continue, I could give you a short background about myself so you will know where I am coming from.

The Hate Within

For most of my life, I hated myself. My daily mantras were, (but not limited to): 

"Stupid" ! "Worthless" ! "I do not deserve to be happy" ! "Nothing I do is ever good enough"

"I just want to die" ! "Lord, please kill me now" ! "I will die before I reach 21"

It is only by the grace of God that I am still here in this world, living and battling with my inner demons. So you see, I never really thought much about where I want to be and what I want to be in the future. For me, I only see my imminent death. 

Starting Life All Over Again

Maybe that is why when I finally decided to "live my life" and start my life anew, I have been so obsessed with finding my purpose in life. I want to believe that I am not an accident, that God has been so patient with me because He has this specific mission for me. I want to know where I am supposed to be and what I am supposed to do.This is why I have never thought twice in spending money on self-help and inspirational books. I have immersed myself to the stories and teachings of the likes of Bo Sanchez, John Maxwell, Joel Osteen, Rhonda Byrne, Oprah, Jack Canfield, and others.

You might think that this desire in me to become a better person is a great thing, but I tell you that it is not all good. I was doing something wrong somehow. Between my inner demon whispering my past failures and my inner seeker obsessing about my future, it is so easy for me to not be in the moment and embrace where I am now. For four years, I have been in the wildest ride of my life. I feel like I am a bipolar person. One day, I am at my happiest, then something happens and I am back to being depressed. It is a vicious cycle, one that I felt I would not get out of. There had been days when I told myself, "What's the point? I should have just killed myself back then."

But you know what? The greatest miracle happened just this year. Before I graduated from college, I have no clue whatsoever on where I will apply and on what kind of job I prefer. (Remember, I have no goals in life. I do not have a 5-year or10-year plan.) But I do know one thing, I want to have a job as soon as possible. No breaks for me. Why? Because I have already "wasted" my time before. (You have to forgive me though because the story on how I "wasted" time before is for another day.)

How God Prepared My Way

So, did I follow through with this plan of mine? A big NO! You see, I have this thing wherein I "think too much" and I "over-analyze situations" that most of the time, I get stuck while the opportunity goes away. I'm just not an innate doer. I'm a thinker, that's my nature.

So while my batchmates were busy sending their resumes and applying for jobs, I am at home reflecting on what I really want in life. But I thank God because despite my laziness to apply, He still gave me an opportunity to earn money while I am getting my life back on track. And He really knows how to bait me. 

While deciding on what I want, I have followed Bo's guidelines that if I want to succeed, my business or work should be connected to my life purpose and core gifts. But since I cannot answer my life purpose yet, I decided to determine my core gifts. I acknowledged that one of my core gifts is writing. So when I saw this ad looking for freelance writers, I grabbed the opportunity (after much-needed consideration of course) and applied even though I have no background on writing content articles. Amazingly enough, this stint lead me to my job now. 

When I visited my friend who lives in Bataan, I met her friend who is also a freelance writer. We just met that one short time the day we were leaving for Manila. I was so surprised to receive an invitation from him that his friend is looking for writers who can work full time or part time writing product descriptions, articles, blogs, and others. I started out as a part time writer for them, and now I am working full time as a virtual assistant (I just gave myself that title because I am not writing for them anymore, rather I am involved in numerous projects doing all sorts of things). And this job, together with the people I work with, is truly a gift from God.

Receiving Miracles

Because of this job: 

1. I now earn my own money. It may not be as big as compared to what my friends are earning now on their jobs in the Hospitality and Tourism industry, but it helps me pay our electricity bill. More importantly, I am now able to set aside money for tithes and for my future. Following Bo's advice on how to divide income, as soon as I receive my monthly salary, I set aside 10% for my Forever Fund (tithes), 20% for my Future Fund (investments), 50% for my Fixed Fund (electricity, internet, grocery), 10% for my Freedom Fund (savings), 5% for my Fun Fund (rewards for myself), and 5% for my Frivolous Fund (incidental  or unplanned expenses). 

2. I am better than ever. In the past 6 months, I had gone into a long phase of depression that has started while I was still in college. Now, I am back on my tracks and I am starting my life all over again. There are still the varying degrees of highs and lows, but I am happy to note that I am experiencing great days longer and I am able to pull myself out of the pits faster than before. 

3. I am embracing the Now. Finally, I am able to leave my past behind and not worry too much on things that are yet to come. Of course there are still some days when I feel anxious, frustrated, doubtful, and dejected, but I am now able to feel those feelings while allowing God to work in me and believing that I will get over those feelings soon.

4. I am given an opportunity to gain financial freedom. The first paycheck I received, I immediately joined Bo Sanchez' TrulyRichClub. Because I have yet to discover what I really want to pursue in my career life, I thought that I could at least start learning on how to take charge of my financial life. I figured that if I invest on changing my wealth mentality, the physical manifestations of this wealth will follow. And amazingly enough, it does. With the amount I am earning for the past four months, I was still not able to save Php 5,000 to allow me to open an account in CitisecOnline (the top online broker in the country that offers  an opportunity to invest on the stock market even with little time, knowledge and capital through their COL-EIP program). But then, when I celebrated my birthday last September, my father sent me Php 5,000.00 for my birthday gift! Without a doubt in my mind, I used this money to apply at CitisecOnline, and now I am a proud part-owner of three companies! The excerpt at the start of this blog entry was actually written right after I lodged my application. 

5. I now have a mission. This thought just came to me this week. God is really such a great planner. There is a reason why I am so passionate about learning from the great people I have mentioned earlier, why there are no second-thoughts whenever I purchase their books (really, I hesitate in buying shoes that are over Php 500.00 but when I see a book I know will help me on my self-growth, even if it is Php 800.00, I will immediately buy it). There is a reason why I did not find joy in writing product descriptions and articles and blogs about lighting, christmas trees, and other stuff despite claiming that I have a gift for writing. There is a reason why I became familiar of Bo Sanchez because of Kerygma and why I have considered him as one of my mentors. And the reason, I believe, is because God wants me to share my stories and learnings in life through my writings.

When Lyf Throws U Lessons

This entry is just the introduction to my series, "How I Became Financially Free". No, I am not there yet. BUT, I am now on that journey. And I am declaring through this series, that I will achieve financial freedom in the near future. With this series, I want to share to you what I have learned from Bro. Bo through his TrulyRichClub, especially the benefits of investing (not merely saving) your money. I will share to you the steps I have taken, am taking, and will take as I continue this wonderful journey towards true financial freedom. 

I hope that you take this journey with me, together with the others who have discovered this powerful blessing from God. It is about time for you to take charge of your financial life because you deserve to be financially free!

If you are taking charge of your financial life now and you want to share your own stories and life lessons, I would love to hear and learn from you as well. Or if you also want to change your financial life,  I invite you to declare with me your own affirmations of being financially free. 

Praying for your happiness!

Joanne