Money & the psychology of money
“If a man works hard, the land will not be lazy” Chinese proverb.
What do you want to be when you grow up? For some reason, when people think they are fully grown, they take offence when they are asked that question.
I am of the opinion that as long as a person remains alive, they should continue to field that question. A life that never has to deal with that question can remain stagnant. It has been said that by the age of 32, most people have stopped growing. Contrasting statistics is that most millionaires did not become millionaires until the age of 40. It seems from this that there is an eight year gap between lack and wealth.
In his book, Outliers, Malcolm Gladwell wrote about the fact that most experts need about 10 000 hours to become experts. If we rewind the lives of most people up to the age of 32, what will we find?
We may find that up to the age of 32, most people are only busy setting up the basics of life. 6 years to kindergarten plus 12 years of basic education gets most people at 18, ready for tertiary education. A 4 year degree gets you ready for the job-market at 22. The 10 years from 22 to 32 are a mixed bag of career development, relationships, children, loans, people, places, events, more loans, fatigue … and a desire to settle …
When do you get to hone a skill? What does it take to hone a skill? In the book, Think and Grow Rich, Napoleon Hill, suggests that one of the ways the millionaires he studied became rich, was through the development of a specialised skill. Drifters, that is, unfocused people, cannot make a success of anything.
If you reach the age of 32 with a lot of clutter, it takes special efforts to un-clutter your life and refocus it. This is what we call “living in the gap™”. The Gap is a place of uncertainty. If you don’t set clear goals in the gap, you may go around in circles. People who do not reach their goals are people who have not learnt the art of living in the gap.
The first thing you must do is determine your gap. It starts with figuring out where you are. What have you accomplished thus far. What resources do you have available to you right now. What skills, what talents, what abilities?
Decide what you want to accomplish by a certain period. How can you employ your current resources, skills, talents, abilities, networks, etc, to reach your goals. Draw a strategic plan. Draw a financial plan. What will it cost you to implement your plan? Where will that money come from? Can any of your resources, skills, talents, etc help you bring in new money to finance your plan?
New money is very important to reach new goals. Old money is often tight up in old projects. Your salary is part of old money. It is often already committed to debit orders, stop orders and what not. New money is money you will make from your new ideas. That is the money that can help you to reach your new goals. That is the money that can help you to live in the Gap!
(Nelson Letshwene is the author of Your Longing Is Your Calling, and Mastering My Finances. He is a columnist with The Botswana Guardian, and can be contacted on email@example.com or on about.me/nelsonletshwene)