Spoiler alert: Personal financial success has little to do with good luck!
When friends found out my husband and I were retiring in our mid-fifties to pursue our dream of traveling and moving to a big city, many of them exclaimed, “You’re so lucky. I’ll never have enough money to retire”. The implication there was that our dream came true because of some “luck of the Irish”, an unexpected good fortune reaped solely by chance.
Not so. We didn’t find a pot of gold. We didn’t inherit vast sums of cash or win the lottery. We certainly didn’t get rich investing in the stock market, which had its worst performance in recent history the decade before we retired. In fact, we aren’t “rich” at all by today’s standards. What we did, though, was figure out how to live a life that allowed us to make and save enough money to retire early – essentially creating our own financial good luck – and you can, too!
Whether it’s retiring early or saving enough to travel on your vacations or simply having enough to pay your bills without worry, you can set yourself up to succeed financially. Good luck is about paying attention, making good choices, and staying positive. Here are some tips to help you create your own financial good luck.
- Make financial independence a priority. It all starts with you deciding that you will have enough money to do the things you want to do. If that is your priority, then good financial decisions will follow. Set a goal and write it down. Post it on your mirror. Make it your smartphone background. “I will create my own financial good luck!” “I will save $1000 dollars by the end of the year.”
- Be optimistic and positive. Expect good things to happen. Expect that you will save, and you’ll never give up. Having a positive outlook is key. That whole “mind over matter” idea works. Think of yourself as lucky rather than unlucky. When you get your paycheck, don’t gripe about how much tax is taken out. Instead, take control over what to do with the cash you have in hand.
- Start with small steps. When I was young and newly married with just a few hundred dollars in the bank, my first financial goal was simple – be able to pay the rent each month. Later, I changed it to having at least $1000 in my savings account. Eventually, I challenged myself to increase the total balance in my savings and checking accounts each month and then each year. That small step, started early on, added up to lots of savings over the years.
- Balance fun with frugality. One of the hardest things about managing money is the stress it can put on relationships, particularly if one of the people in the relationship is a big spender and the other is a miser. In our house, we balanced fun with frugality by making sure all the monthly bills were paid then treated ourselves with an inexpensive reward like a day on the beach or hiking or biking. Finding free museum days, art galleries, movies and other ways to reward yourself help you save, too. The more we saved, the more fun we could have! Find the balance.
- Get good financial advice, but trust your intuition. Once we had some decent savings and an emergency fund, we started thinking about investing some money for the future. Should we start IRA’s or buy stocks and bonds or mutual funds or CD’s? Finding a trustworthy professional helped us look at our options. Some of those options felt like good choices, but others made us feel nervous, so we chose not to act on them. Trusting your intuition is as important as getting good advice.
- Take advantage of catch-up opportunities. Because we had been very conservative investors during most of our careers, we were way behind the ideal goal for retirement income. Our financial advisor informed us that we could make much larger “catch-up” contributions to our retirement accounts after we turned 50. This strategy proved to be the icing on the dream-come-true cake for us. SO, if you are over 50, check out the possibility of putting a little extra away.
- Educate yourself. People who have good luck are people with a growth mindset. They never stop learning. Read library books on financial independence and investing. Find classes at your local community college. Sign up for e-newsletters from financial advisors like Suze Orman. You can always learn more and get better at developing your financial intelligence.
- Relax and stay open-minded. Relaxed and open-minded people tend to be more open to chance opportunities. Often, financial good luck comes to people who notice those unexpected opportunities. It might be that a conversation with a friend leads to a new investment. A chance meeting with a business contact at a conference or on an airplane might lead to some freelance work or a new job. Who knows? Just relax, pay attention and maybe some opportunity that you never thought of will cross your path.
- Be grateful. One of the best ways to create your own good luck is to be grateful. People who understand that things could always be worse, understand the power of being gratitude. Every day when I walk by another homeless person on the street, I am grateful I have a roof over my head. Being grateful, even for small things, makes you happier, healthier and more productive. All those things are bound to have a positive impact on your life and lead to making good financial decisions.
In the end, making your own financial good luck is all about choices.
Choose to be positive, open-minded, attentive.
Choose to take small steps toward your goal of financial independence.
Choose to be grateful for each step you take.
Soon, you will begin to see the difference it will make in your life. Good luck!