Instead of relying too much on the bank, we should be the bank. This is a common problem among people who have just recently paid off their debts. Suddenly, they have a lot of extra money to spend, but they fail to take care of their money. In the end, they are not able to save much and many of them are back in debt, due to uncontrolled spending. That’s obviously a bad financial problem and we should avoid treating ourselves poorly. When we have extra money, we should look for ways to save it. It is acceptable to congratulate ourselves and celebrate when we have paid off our debts, including our mortgage. A dinner with the family in a restaurant is acceptable, but spending $10K on an unplanned vacation is not. We should treat our extra money with extreme respect, just like when we carefully managed the bank’s money. We should remember how much effort we spend to earn every dollar of it. If we use it to purchase items that will depreciate, we are simply throwing money out the window.
We shouldn’t buy things that lose value; instead we should try to wealthier just like a bank does. It starts by treating our own money with respect. By being our own bank, we should accumulate enough money in a specific account. Each time we use it to purchase an item, we should pay it in cash using the money. However, the most essential part is to pay ourselves back and WITH INTEREST! It means that we should apply the same interest rate that’s used by local banks. This way, we should be able to treat our own money like it’s the bank’s money. This should allow us to grow our wealth faster in the right direction. We could prepare our finances for the future, especially for our retirement period. However, we should continuously improve our banking system. If we don’t have a plan to buy anything, all extra money should be directed towards increasing the value of our central funds.
However, banks can get really rich only by allocating money for specific investment projects. So, once our central fund has reached certain amount, we should use it for the most promising investment option. Although this may sound like an innovative plan, actually isn’t a new concept. This is the secret weapon that many people have applied for hundreds of years. If we are disciplined and we do this consistently, it should be quite easy to grow our wealth and be prepared for the long term plans. However, for many people, this is a new way to grow their wealth and for them, it seems like an excellent thing to do once they get out of debt. It is important for us to try to build our wealth consistently. This should be a relatively easy thing to do, if we know what are needed to improve our finances. Managing money should be quite straightforward to do if we know all the basic rules.