Ever wondered why most people blow all their cash before the month’s end?
Not only that, but you and I, if we are being honest, at one point or another, once spent more than we earned in a month.
Unfortunately, this is often the reality for many people. I won’t mention any names, so relax and know yourself.
Living within your means, to some extent, almost feels like deprivation. Wait that’s not the full story.
If you are to graduate in personal finance, you need to move from living within your means to living below your means.
It takes great intentionality, discipline, and humility to harness this often-neglected superpower.
We know you would need a margin somehow to get that capital to start your own investing journey. Without a margin, there is no room for investment, as one will be stuck in the repeat-and-rinse cycle: earn, spend, borrow, and wait to start the cycle all over again.
Years ago, I watched the reality TV show called Undercover Boss, where the owner of the business would visit his company and pretend to be a junior worker and work as a cleaner or something just to see what’s going on in his business.
This is more like living below your means, where you take a backseat role and live on way less than what you have to build more.
Why living within your means isn’t enough?
I will give you an example of the difference between living within your means and the superpower idea of living below your means.
If Sam is earning R25k a month and somehow his expenses do not exceed the R25k, maybe his expenses come to R25k, then Sam is living within his means.
On the flip side, Sally earns the same amount as Sam R25k and her expenses are R15k. Then, Sally is mastering living below her means.
Despite having the same salary, Sam will end up with nothing after his living expenses, but our wise friend Sally will be R10,000 richer. If you are living above your means in this example, it means your everyday living expenses are higher than the R25K salary per month. Let’s assume your expenses are R35k on an R25k salary. If this is you, don’t shame yourself, but realistically, you are on fire, dial the fire brigade. You need a firefighter if you want to live a better life. You’d better put out this fire ASAP before you become ashes.
The slight difference between living below your means and living within your means makes all the difference in whether you can build wealth.
Check this out! Although frugal Sam is not overspending or in debt, he is still in a worse position than Sally.
Unfortunately, most people aim only to live within their means and miss the bigger picture of the Freedom story. To live on less, particularly at the start of the journey, you need the margin to build wealth.
Being intentional and humble enough to live below your means allows you to attain real financial freedom. Otherwise, you will work for money all your life.
The price of freedom
To get to this exceptional power of living below your means, work for it.
Yes, financial freedom is not cheap there is a price to pay, like any good thing in life.
Most people have encountered the term compound interest if they are familiar with investment returns and related concepts.
Some call this the snowball effect. This is the idea of rolling a snowball down a hill and gathering more snow as the ball goes faster, bigger, and bigger downhill.
Hang on, friend. It’s not that simple at first.
I think you and I need the discipline to push this savings snowball uphill first before going downhill.
This is the live below your means mindset.
Ever wondered why people say the first 100k is the hardest to save? It’s generated mostly by living way below your means.
That’s the price to buy a small snowball that will eventually grow with time and consistency.
You should be prepared to fight, since the odds seem to be stacked against you.
Everything worthwhile in life often comes with a price to pay.
Don’t despair it’s the nature of life. Don’t hold back; however, be prepared to fight.
The other day, I read a disturbing advertisement in the local magazine.
Here is what the ad said: Looking for financial freedom? We can help with cash loans, vehicle finance and refinancing, balloon payments, and debt consolidation.
What a deception, I thought. This was not financial freedom but financial bondage.
There are no shortcuts to financial freedom, only the same old route: pay off the debt, one payment at a time, no magic formula other than working on it. You can’t pay a debt with another debt; that’s insanity, repeating the same problem repeatedly.
Most times, you will fight yourself. That’s right you are your opponent. The one in debt, it’s like trying to harvest honey; you can’t avoid the beehive; the honey is in the beehive. Unless you have extra cash, you can call Checkers Sixty60.
The bad money behaviours you have built over the years have to be defeated, and those behaviours won’t go down easily.
It’s almost like trying to pull up an enormous tree from the roots it can be done, but the tree won’t give up without a fight.
Going to war (with yourself)
Okay, let’s go to war. Wait first, we need to create a strategy.
It’s like trying to lose weight it’s difficult, but it can be done.
Okay, money is different; we are trying to gain, not to lose, I get that!
If you want to be healthy and fit and lose weight, and you are a couch potato, it’s hard, but it can be done, right?
So let’s start here.
Let’s assume you are a money couch potato if there is such a thing. Chill out, I am not insulting you; I am just being realistic.
You can’t pretend to be what you are not. You can’t fool yourself; always remember math can’t be cheated.
Some have tried this strategy; it doesn’t work. You cannot straighten what is crooked without being realistic.
Start small and stay consistent
Be honest with yourself about where you are. Don’t lie, don’t hide, don’t pretend.
Since you are a couch potato, you can’t just put on your shoes and hit the road running; you might faint, or even die.
So, start small.
Please work out a plan to get to living within your means first.
To be clear here, you can’t even prioritise investing if your debt is high, like Mount Kilimanjaro.
Fix this monster first and work your way step by step.
Maybe start by walking, yes, walking.
Although your dream is to run a marathon one day, start by walking.
It’s the small step that you need to work on as you start your journey to freedom.
This is the start of your climbing journey. Take your time you finally decide to pursue your freedom.
By just starting this small step, give yourself a high five or even a pat on the back.
Most haven’t even decided and will never decide on this journey.
This is truly the road less travelled; only pioneers attempt it, and you are one of them. Those who make a path through the forest of instant gratification.
Discipline is the skill that buys freedom
Perhaps one of the biggest personal finance skills you need, and you can’t do without reaching a stage where you can live below your means, is discipline.
Discipline is a prerequisite for a successful life. If you hate discipline, forget it; you will never reach the peak of the freedom mountain.
By walking every day, you are flexing and practising discipline.
Sure, there will be days you’ll feel like it’s a waste.
Hang on it’s never a waste.
Start small. Don’t do more than you’re able to do.
Start by saving a little. Even 1percent is better than none.
Those who live below their means are not influenced by popular opinion, but they are secure enough to resist the temptation of shopping for clothes every month.
Nothing wrong about buying clothes, by the way, but you can’t chase both your freedom and the latest fashion trend at the same time.
If you can control living below your means, you are a proper adult in my world.
You don’t follow most people, and you are secure enough to defeat the virus of instant gratification.
The long-term payoff
If you can live below your means and invest a handsome portion of your income, and you don’t reach financial independence, please write to me I will take you out for dinner.
Hang on, restaurants are expensive these days; I might opt to cook you a delightful meal at my house.
Embrace the superpower of living below your means and invest the difference, and you will reach your freedom sooner than you think. Saving and investing money while cutting lifestyle costs is not deprivation but realignment, being intentional with what’s important to you. For you and me, it’s our time of freedom and the choices that will afford us.
Trading Time or Buying Freedom 
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