Why Most People Are Living Paycheck To Paycheck | 113

MORI 113 | Financial Freedom

Why are so many people struggling to have extra left over each month? Did you know that it’s NOT because people are uncontrollable spenders? In fact, it’s human nature to spend what you earn! Cash Flow Expert and Host, Chris Miles, shares why so many people are living paycheck to paycheck naturally. And how you can stop that pattern and start living a life with more freedom! Tune in now!

Chris Miles Bio:

Chris Miles, the “Cash Flow Expert,” is a leading authority on how to quickly free up and create cash flow for thousands of his clients, entrepreneurs, and others internationally! He’s an author, speaker, and radio host that has been featured in US News, CNN Money, Bankrate, Entrepreneur on Fire, and has spoken to thousands getting them fast financial results.

Listen to the podcast here

Why Most People Are Living Paycheck To Paycheck

If you haven’t checked us out, be sure to visit our website www.MoneyRipples.com. There is an eBook on there. It is called Beyond Rice and Beans: 7 Secrets to Free Up Cash Today. If you ever said, “I’m making more money, but where is it all going?” If you want to figure out how our average clients have freed up about $33,000 a year, check it out. It’s free for you to be able to get for yourself. It’s an easy read, especially if you’re a busy entrepreneur. You could seriously read it in less than half an hour. If you’re a slow reader, it might take 33 minutes. Also, be looking for our events. We’ve got an event coming up in September, our final one of the year. It’s a live event. If you want to see me live and be able to learn some of this stuff more deeply, please check that out as well.

Today, I have been thinking about what is important. I hear a lot of people with different questions, problems, and situations. As I deal with my own clients one-to-one and everything else, there are so many topics I can cover. I wanted to go back to a topic that hasn’t been addressed much. I wanted to go back to our financial strategy conversation, although it’s much more a principle than a strategy if you think about it.

This is a special case because I see many people, even though they are making good money, they are paycheck to paycheck. Even if they don’t have to be, they are. I want to dig into why that is happening. Why are people suffering needlessly? They were going through this horrible time. It may not be horrible. It may just be that you’re a little bit uncomfortable because you would like to be a little bit more comfortable. It doesn’t mean that you’re in the hole or going into debt, although that could be the case too. It might be that you’re tired of being in the rat race. Are you at that place now? If so, this is an episode you should be tuning into.

I want to talk about this, and I want to bring up my situation. I remember I have shared with you before that in 2007, 2008 and 2009, I was badly in the hole. When I started to look at my numbers in 2007, I was in the hole for about $16,000 per month. That’s how much I was short that I needed. I wasn’t making the difference. Previously, I was making the difference by using lines of credit and credit cards. I’m getting money anywhere I can. I’m liquidating my savings to the point where I don’t have anything to liquidate anymore, and I don’t have credit to use anymore. That’s not a great place to be.

One of my clients, we were chatting for a few minutes today. He said, “I’m going through these numbers. Should I hide this from Chris? Should I let him know?” I always laugh because I think, “There’s no way you’re worse off than I ever was.” Most of my clients nowadays usually aren’t that tap-off. They are usually looking for hope and for something more. They want them to get their money working for them instead of them always working for money.

For him to say that, I laugh and chuckle because I’m thinking how is that even possible because I was in the hole for $16,000 a month? My expenses were $22,000 a month, but my income was only about $5,000 or $6,000 a month. That’s not a good place to be, especially during the Great Recession. It was not a fun time. I had properties I had to get rid of and everything else. During those times, I also learned the best tools, and that’s where I learned a lot of the cashflow tips, especially the ones that I told you to get from my website. That’s where a lot of those came from. It’s between that, as well as working with hundreds of my clients.

We tend to consume whatever we create. That's human nature. Click To Tweet

People say, “It’s probably because you rack a lot of debt.” I had debt, but even if I was debt-free, I was still going to be short every month significantly. It wasn’t the debt. It had nothing to do with that at all. It has to do with these two laws you have to understand. The first law is Parkinson’s Law. It pretty much states that your expenses will rise to meet your income. Wherever your income is, your expenses will go.

A good example of this is if you ever had a raise at work or you started to make more money, have you ever noticed that even though you make more today than maybe you did before, it’s almost like you have no extra money? Have you ever seen that before? Maybe you paid off a bill or some loan like a car loan or something like that. You’re like, “It’s off my plate.” A few months later, you say, “I thought I was going to be much better off but I’m not. Where are that savings? I’m not saving any money. I’m still paycheck to paycheck.” That’s because of Parkinson’s Law. We tend to consume whatever we create. That’s human nature.

There is another law that is similar to that in nature called the Law of Vacuum. It is that space that forms a vacuum. If there is a vacuum, something will try to fill it. This happens a lot of times. When people increase their income or decrease their expenses, they are still spending whatever they are making. Even if they are saving a little bit, they still think, “I should be saving more. Shouldn’t I?” That’s normal. That’s human nature.

That happens because you’re not paying attention to your money. That comes to the second law, which is the Law of Attention. Whatever you put your attention towards will expand and grow. The opposite law, I referred to it is the Law of Atrophy and Decay. It says the opposite. Whatever you ignore will leave, go away, disappear, and somehow disintegrate. For example, we talked about ignoring your teeth. If you ignore your teeth, you will lose your teeth. If you ignore your relationship or if you ignore your spouse, and you’re passive in your relationship with your spouse and not active with it, you won’t be married much longer. It’s the same thing with your family and kids. They won’t be around much longer either.

The same is true with money because money is a relationship. If you’re passive or you’re even non-existent or non-present with your money, it won’t stick around either. We got to make sure that we’re allowing you to stick around and make that work for you. That’s what I mean by the Law of Attention. Whatever you put your attention towards expands and grows.

I’ll give you an example. I started to pay attention to my physical health. I have been paying attention to my weight. I know that weight is not everything because I’m building muscle, running, and doing things like that. That also is heavier than fat. I’m taking photos each week to keep track of my progress. At the same time, I weigh myself on the scale to see how that works too. It’s fascinating because that extra accountability allows me to be more focused and to accomplish the task that I’m out to do, especially where I’m thinking, “Keep going, Chris. You’re looking more like how you have even envisioned. Keep going.” It helps when you are tracking your progress.

MORI 113 | Financial Freedom
Financial Freedom: If you want your money to grow, improve, and produce, you’ve got to pay attention to it. You cannot turn a blind eye and expect it to be there or for it to grow. If you ignore your money, it will leave you and find somebody else who will not ignore it.

That is what I challenge you to do with your money as well. It’s to track it. You have heard me say this so many times. It’s even the first tip that I give when I tell people to do this, but you got to make sure that this becomes not just a habit but a lifestyle and part of your life. It’s something that you do. If you want more money or if you’re a business owner and you want more business, you want your money growing, improving and producing, you got to pay attention to it. You can no longer turn a blind eye and expect it to be there and wait for it to grow. If you ignore your money, it will ignore you. It will leave you and find somebody else who will not ignore it.

I’m not saying get into scarcity and the mentality of hoarding all your money. That has the opposite effect. That will also drive money out of your life to some level. What I’m talking about here is how do we make sure that you keep what you make and make more on top of it? This is why when you track money, first and foremost, it’s the tools that you use. If you’re a business owner, you want to use something like QuickBooks and some programs like that for your business. They have great online programs that allow you to download all of your information. You can have it all there. You have to make sure you categorize it, get it all set in order, and it’s there.

That is the first thing. If you’re a business owner, make sure you have QuickBooks. This is the second thing for everybody. Everybody can do their own way, but if I were to give a blanket type of recommendation here, if you’re not doing anything, at least try this. Try setting up a free account with Mint.com. What I love about Mint is just like QuickBooks, they download everything. You can connect it with your bank accounts. It doesn’t mean that you can withdraw money from it. I’m not telling you to do Mint Bill Pay or whatever it’s called. Don’t do that one.

I’m talking about how to track it. They will allow you to see real-time and show you all your balances on your checking or savings accounts, your balances on your loans and credit cards, and everything else. Anything you can access with a login, you can go on and be able to connect that to your bank. You can see all of that information in one place. On top of that, you can even categorize it. A lot of it is done for you because they will guess correctly on the categories, but you can even categorize them and see where you’re spending your money, and because we’re talking about the Law of Attention, where you’re making your money too.

Don’t just pay attention to what you’re spending. Also, look at what you’re making. Many people, especially those saver and scarcity mentality, will pay attention to the money they are spending, but they won’t pay attention to the money coming in. You should be just as excited, if not more so, about bringing in more money. I don’t say this often, but I’m going to add this. Make sure you attach good positive emotions to it, whether it’s your expenses or your income. Don’t get all boohoo and everything else. That’s not what we want, but we want you to say, “Look at this. I’m getting clear on where my money is going.” Even if you’re overspending, at least you’re clear about where you’re standing.

Sometimes, when many of my clients look at it, they will say, “We’re in the hole each month. Even if it’s only a few hundred bucks a month, we’re in the hole.” A lot of times, they will have some money coming in that might help offset it or something like that and still, they were like, “We overspent.” Some people get depressed. I’m like, “Don’t get depressed. Look at that and say, ‘What can we do to start tightening things up a little bit?’ Not in a place of scarcity where you’re getting so tight that you’re getting cheap but instead, ‘What’s productive? What expenses are worth it? Which ones are not? What should be the priority here?’” Start to go through that.

Whatever you put your attention towards will expand and grow. Whatever you ignore will leave. Click To Tweet

If you ever feel like you’re too busy to pay attention to money, especially if you’re a business owner, I guarantee you’re losing at least $500 a month. I see that consistently every time. A lot of people ignore their money. Even if they think they are not spending a lot of money, they are. Because they are not paying attention, they don’t have an intention of where it’s going.

One thing I will add to this and what is important is that you’re not only tracking the money, what is coming in and going out. That’s a great start but start creating budgets. I like to call them spending plans. I don’t like to use the word budget, but budget is a more common term people use, but spending plan because money is meant to be spent. It depends on how or when we’re spending it. We want to have emergency savings. I much prefer people to have emergency savings that pay off all their loans.

Some people like to pay off their credit cards way prematurely before they should. It’s something that should be done carefully. I want you to do that. More likely than not, I’m going to want you to pay off your loans, but I don’t want you to do it in a way that is sacrificing your entire lifestyle. When you’re tracking this, I ask you to start to look at this from a positive place to say, “Here’s where I am. There’s no judgment on this. It’s a matter of here’s where I am. What can I do to find more cash?” There’s cash to be made.

I had one lady find $1,500 a month just by tracking her money and tightening things up. She’s not sacrificing her lifestyle. That’s it. Another woman that I have mentioned before has freed up $5,600 a month because of all of her eating out and stuff. I had another person out in Virginia. He found an extra $200,000 a year in his practice. It’s a huge amount.

That’s the thing. There is so much you can do. This is a starting point. It’s not something to be ignored. Don’t look at it as a scary thing or think you should delay or postpone. This is good. There is much good you can do. This is what I mean by tying your emotions to it. I want you to set a goal. I had somebody who said, “I have been tracking my money. It’s great, Chris. We have been great at tracking our money. We save half of our income doing this. Chris, what do we still need to do? It’s a monotonous task. We don’t like doing it.” I said, “That’s because there is no emotion behind it. There are no goals. You are just tracking money.”

It’s getting more than just tracking them. That’s a start but start setting goals. If you’re married, I recommend you do this with a spouse. Get on the same page. No more financial infidelity where you’re spending money that your spouse doesn’t know about. This does not strengthen a marriage at all. I have seen it almost destroy marriages. In some cases, it has because there are all these fears around money. They are afraid of creating arguments and fights. If you come from this from the right perspective, knowing that wherever you are is perfect and you’re looking to improve your situation. That’s why you’re doing this. You’re being proactive. This should be celebrated, not forbidden or even in a place of dread. This is a good thing.

MORI 113 | Financial Freedom
Financial Freedom: Money is meant to be spent. It just depends on how or when we’re spending it.

Look for ways to put positive experiences, set goals, and do things. If you want a new house, drive around the neighborhood where you want to live or the type of neighborhood you want to live in. Start doing that. Get yourself in a more elevated state. Get yourself in a better state and start to work together on these goals.

If you can do this basic thing right here and you do this week after week, I recommend you put in your calendar and set it every same day in time. You make an appointment. You do not cancel. If you have to move around for some crazy reason that’s a rare occurrence, then you reschedule it. You do not cancel it. Every single week. Even if it’s for 10 or 15 minutes, that’s it. Touch base. Get on the same page. Know where you are financially.

When I used Mint and I looked at those numbers, it took me over four minutes when I timed it from logging in to logging out. That was for a whole week. You can do this. It’s not hard. It’s just a matter of prioritizing it to say, “I want my financial life in order because it’s not just about me, it’s about my dreams, my goals, and my children. It’s about the people in my life, the people around me, and the people I don’t even know yet that I want to bless and make their lives better because I know that the whole human family is my family.”

The worst thing you do and the thing that takes me off the most is if you say things like, “Chris, I want to be comfortable enough where I can pay the bills and take care of my family.” Do you know how freaking selfish that is? Do you realize there are people around the world that wishes they could take care of their family? You’re like, “If I can just take care of my family, that’s good. I don’t need more.”

Get up off your freaking keister and create more. There’s so much more you can create in this lifetime. It is so short. Don’t sacrifice your life and relationships to do this. I’m not saying that, but enjoy life. Enjoy what you have here and what you can do. We are uniquely designed from birth. We are meant to always improve, grow and become better. That is our divine nature. Don’t deny that by saying, “Enough is enough. I’m comfortable. I’m at least paycheck to paycheck. It’s all good. I could probably retire,” which the likelihood is they’re doing it like everybody else is teaching you. The answer is no, you will not retire. There is no way we will be able to retire with 401(k)s and IRAs. You can learn that from other episodes that I have taught here too.

The thing is that you want more, become more, be more, do more, and then you can have more. You will have more if you start to do these things. Focus on this and make this a priority. Everybody, set that in your calendar. Set it right now that this day and this time is going to be my date to myself. I promise myself to create financial freedom. If you’re spending time every day or every week to go work out, you can set aside a few minutes every week to be able to work on your financial health too. Everybody, have a wonderful and prosperous week. I can’t wait to talk to you guys. I’m looking forward to it. We’ll talk to you later.

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