It's the Olympics season! As I watch the various games, it struck me that these professional athletics are really the best of the best at their game, and for a good reason. Their skills have been honed over years of intense practise and rigorous training, something not many of us are prepared to go through. These athletics have chosen to play at the international level and competing to win for the personal triumph and glory to their nation.
That got me thinking, that Life is a game, just like sports, and the level we choose to play at will shape our results and experience.
When it comes to your financial life, what game are you playing?
What must you achieve in order to feel you have won the game?
Is it to become a millionaire? To retire in style and be free of money worries? Is it to be able to sponsor your children for an overseas education? Buy your dream home? Or are you happy as long as you are comfortable, have enough to pay for life's necessities and perhaps go for an occasional holiday?
Every one of us is different. Your personal goals and dreams will determine the level you play at, and the corresponding amount of effort and time required to win your game.
When it comes to the game of wealth, there are 3 different levels, each of which requires different commitment and skills to emerge a winner.
3 Levels of Wealth
1) Financial Stability
You are able to support your current lifestyle with your income and are on track to achieving your goals e.g. buying a house, car, children's education, etc. Having the peace of mind knowing your lifestyle is secured, even if emergencies such as loss of job, illness or disability were to arise.
How to win:
- Prudent money management - setting aside a portion of your income each month to save towards your goals
- Planning ahead and being prepared for contingencies - setting up a family emergency fund that can support at least 6 months of living expenses.
- Financial Security- ensuring adequate insurance protection to cover costly medical bills so that you do not need to empty your savings
2) Financial Freedom
You are free to enjoy your current standard of living without having to work for the money. This means having the ability to generate regular income passively to support your living expenses, so you can do whatever you enjoy without worrying about money. You may still continue to work but you choose to, not because you need to.
How to win:
- Clarity of goal - Be very clear of how much you need to become financially free i.e. your monthly expenditure
- Learn ways to generate passive sources of income and invest time in yourself to pick up the necessary skills. Some common ways are through stock dividends, rental income on property and setting up systemised businesses.
- Start building up assets and investments that can generate the amount needed to support your monthly expenses.
Financial Freedom is an idea widely promoted by Robert Kiyosaki, the author of Rich Dad, Poor Dad. He created a board game called Cashflow 101 to show people how to get out of the rat race and become financially free. This is a fun and educational board game that teaches about personal financial statements, investing concepts and simple strategies to get out of the rat race. I have played this game many times over, and each time I play it, I get new insights and wealth creation ideas!
I believe one of the best ways to learn is through play and so I often play the Cashflow game with my friends. If you want to experience the game for yourself and have fun learning about how to become financially free, you can indicate your interest here so you can join in our next game!
3) Financial Abundance
This is taking the game to a whole different level, going for wealth and abundance where you have more than enough for yourself and even your next generation. This is the league where the millionaires, billionaires and wealthy successful people like Warren Buffet and Bill Gates play at. These are also the people who are able to use their financial resources to impact the world e.g. starting a charity fund, championing a green initiative, etc.
How to win:
- Learn from the giants - Many of the richest and legendary people such as Li Ka Shing and Warren Buffet made their fortunes from businesses and investments. There are plenty of books written about these successful people's philosophy and strategies. Read, learn and apply the lessons taught to grow your wealth exponentially.
- Find an area that you are passionate in, be it business or investments and commit yourself to be excellent in that area. Often it is in the passionate pursuit of excellence that attracts success and wealth.
- Find a mentor - Good mentors are people who have achieved success in your chosen field. Mentors can guide you, point out potential mistakes and pitfalls to avoid, and direct you to resources and opportunities that can help you achieve you goals. If you want to build a successful multi-million dollar business empire, look for someone who has done it before and learn from him or her, join associations or clubs where you can network and reach out to these successful business owners.
Which level of wealth are you playing at? Are you doing what it takes to win the game?
The game I choose to play is Financial Freedom - because I want to have the freedom of choice, to do whatever I enjoy, whenever I want to, with the people I love - my family, without worrying about money.
Before I became a mum, financial freedom was something that seemed good to have, something I touted but never really worked towards. To be honest, I was playing the game of Financial Freedom for the sake of playing but not playing to win. Looking back, it was because subconsciously, I was comfortable with my current standard of living and financial stability. There didn't seem to be a real need or urgency for it.
But ever since becoming a mum, I truly appreciate the freedom of being able to watch my girl grow up and be with her during her formative years. I want to be there to witness her life milestones and special moments without being tied to work or financial commitments. Now that I am finally taking the steps necessary to win the game, putting in the time and effort on my investments and creating my passive income streams.
Look forward to sharing with more about my journey and success towards financial freedom in future blogs, stay tuned!
To Your Success and Happiness,
Message from IM$avvy Admin: CPF Board has developed a financial literacy game for iPhones and iPads. Know more about the game here and download the game to learn through fun!
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