Financial Abundance

During these stressful times of financial turmoil, are you finding it difficult to live with a sense of financial abundance? Have your decreasing financial assets increased your fear of financial uncertainty? Have you lost the feeling of serenity about your ability to meet your financial goals?

If you answered yes to any of these, now is the time to commit to actively managing, protecting and controlling your finances. To move from a fear of financial scarcity to a sense of financial abundance, it may be time to practice:

The 7 Steps to Financial Abundance

1. Spend less than you earn.
2. Maximize your financial resources.
3. Minimize your taxes.
4. Manage your investments.
5. Protect your financial resources.
6. Control your personal finances.
7. Have faith in continued abundance.

Transforming financial fear into financial abundance requires a personal commitment to actively managing your finances. While practicing the Seven Steps to Financial Abundance will not guarantee fiscal security, as a minimum it will help reduce your fear of financial scarcity, leading to more serenity about your finances.

To help you get started on the path to financial abundance in 2009, let’s focus on the two most important steps, Step 1 and Step 7.

Step 1: Spend Less Than You Earn

This step is critical to maintaining a life of financial abundance. The time from which you begin working until you retire is your “financial accumulation period.” During this time, you accumulate financial resources to pay for your children’s college education, buy and furnish your house, meet on-going financial commitments and provide for an abundant retirement.

Unfortunately, many people are not using these critical years to accumulate the financial resources required to meet their financial goals. Due to “easy credit” provided by credit cards, home equity loans, interest only mortgages, etc, many people spend more than they earn during their critical accumulation years.

In 2009, to increase your financial health, commit to following Step 1. Attempt to save at least 15 percent of after-tax income. If you have a 401(k) or other retirement savings plan, funding this plan can be an excellent, tax deferred method of meeting this goal.

When you do not have a company provided retirement savings plan, use the “pay-yourself-first” savings approach. On payday, make your first payment to your savings account. If you cannot afford an initial 15%, save 5% in 2009, 10% in 2010 and 15% in 2011. This “forced savings” approach requires you to make decisions between “must have” and “nice to have” items and helps you begin the journey to financial abundance.

Use your savings to pay off any credit card, home equity or other non-mortgage debt. Once this is accomplished, build an “emergency fund.” This is a fund with at least six months of after-tax income that can protect you if a short-term emergency occurs. With an emergency fund, you can weather a job layoff or short-term disability, without prematurely using funds from your retirement account.

If you are not certain about whether you are spending less than you earn, if you contact me and I will send you a free Excel based Budget Worksheet that allows you to determine your annual financial accumulation or deficit.

Step 7: Have Faith in Continued Abundance

Overcoming the fear of scarcity requires developing faith in your continued financial abundance. The first six steps to financial abundance are based on actions that you can control and financial habits that you can change. One these are practiced, you have done everything in your power to control your financial abundance.

The seventh step is a spiritual step in which you decide to turn over the things that you cannot control (the economy, the stock market, etc) to your higher power. Knowing that you have done everything possible to ensure your financial abundance, having faith in your continued abundance is critical to your financial serenity. Without faith, doubts and fears of the unknown and the uncontrollable will often become overwhelming.

Practicing the Seven Steps to Financial Abundance requires that you control consumer-driven consumption patterns, maximize and protect your financial resources and nurture faith that financial abundance will continue, as long as you do your part.

Some people find that they need help in practicing these steps. If you would like to practice the Seven Steps to Financial Abundance, but find that you require assistance in their implementation, I would be honored to serve as a guide to help you on this journey.