1. Have a Big Enough Dream
We exchange money for what we value. Many people struggle with financial discipline because they don’t clearly understand why saving money is valuable. So, they gravitate toward spending money on immediate, tangible rewards.
Other people understand the value of saving because they see the dollars pile up in their bank accounts. However, they need help seeing the value of investing. The risk seems greater than the reward of ‘controlling’ their money (even when it’s depreciating due to inflation.)
So, to have financial discipline, your dream needs to be more valuable than the satisfaction of an immediate reward and stronger than the fear of potential risk. Many times, a deficit of desire is why people don’t achieve their goals.
What will your life look like when you achieve your financial goals? Get into a posture of prayer and invite the Holy Spirit into your imagination. What dreams does God have for your life, and how does He want to use your resources to achieve them?
Here’s the thing: financial dreams founded on personal comfort won’t be enough to reach your potential. There will come the point on your financial journey where you stagnate because you aren’t willing to take a risk. Rewards will feel too comfortable to sacrifice. Growing to the level God has for you takes courage, love, and divine intervention. Your dream must be bigger than you!
2. Break the Dream Into Actionable Steps
The secret to knowing how to have financial discipline is in your daily practices. Once you have a 30,000-foot view of your dream(s), it’s time to create a system to make them a reality. Your system will depend on your unique goals and where you are in your financial journey.
For example, if you are trying to get to the point where you make more than you spend, you need a system to get out of debt. My Debt Snowball Method can help with that. It shows you how to pay off your debts, starting with the one you can pay off the quickest (not the one with the highest interest rate.)
If you are already out of debt, the next step is to create a budget that puts you on the fast track to financial freedom. You’ll need to create an investment plan so your passive income can exceed your earned income.
I recommend budgeting using the 70/30 rule as a template. Here’s a breakdown of how to use your income:
- 10% for tithe
- 70% for expenses
- 20% for investments
Of course, there are nuances to this system. For example, God might lead you to give more than 10 percent of your income. Or, your expenses might only equate to 55 percent of your income, creating more flexibility to invest. You may want to bolster your emergency fund before you venture into investments. Then there’s the question of what to invest in–you may be saving for the down payment on a rental property or funneling money into your Roth IRA. As you grow your earning potential, passive income, and investing acumen, you can diversify your investments.
If you have already reached financial freedom, you may be wondering about your next steps. How do you protect and continue to grow your assets? How do you dream bigger about the impact your resources can have? At this stage of your investment journey, joining a reputable coaching program is highly beneficial. In The WealthBuilders Coaching Program, we have a business track and a real estate investing track to help people maximize their passive income and exceed growth barriers.
3. Segment Your Spending
Segmenting your spending is a great way to maintain financial discipline. After determining what percentages work for your budget, create different accounts for your tithe, investments, expenses, savings, etc. If your savings are in a separate account you deem untouchable, you’ll be much less likely to exhaust them. If you have direct deposit, automating payments to different accounts prioritizes your goals without too much effort.
