Financial uncertainty can be one of the most distressing and emotional experiences in modern life. Without an understanding of how your financial future is going to play out, it is difficult to move forward with the confidence required to thrive in a capitalist society. Most of us have experienced the inertia that comes with the fear of financial uncertainty – perhaps losing a job, or receiving an unexpected tax bill. The purpose of this article is to define financial certainty, and explain how to get it.
Financial Certainty is More Than Lots of Money.
In fact, having a high salary or a substantial means of income can be an inhibitor to financial certainty. Those who feel comfortable with their existing financial circumstances are more likely to delay any investment initiatives in favour of more immediate outcomes. If financial certainty were simply having a lot of money, an intelligent pathway would be to earn as much as possible, and save as much as possible.
Financial Certainty is About Knowledge and Control
Someone who is financially certain, knows how the next 20, 30 and 40 years of their life will end up financially. They don't know this through intuition or by being brilliant with numbers, there is a plan in place and they work hard to make sure that plan is on course. When phrased in this way, it becomes obvious that people with financial certainty treat their own finances as a business, with themselves as the CEO. They work with their team to put targets in place, and make educated adjustments if and when those targets are missed. Most importantly perhaps, they take the time to surround themselves with experts, and learn for themselves what needs to be done in order to achieve their goals.
Financial Certainty Comes Through Having the Right Mindset
Those who have financial certainty, have worked hard to get it. They decided at some point, that, "hoping is not a strategy," and work to understand where they are and put a plan in place for where they wanted to be. Interestingly, when you speak to these people you learn that what they are doing is neither complicated nor particularly time-consuming. When you extrapolate the tasks and effort required over a year, there is very little physical time commitment. The only thing preventing everyone from achieving financial certainty, is the action of starting.
Financial Certainty is a Series of Moves
Very simple, and often repetitive moves that mean incremental improvement. Of course, when you extrapolate these incremental improvements over a number of years, and look at them as a percentage of growth, they can be the difference between a stable financial future, and rolling the dice. By committing to making the right moves each year, financial certainty stops being a gamble, and may even become mundane from a tactical standpoint.
By moving towards financial certainty, you also gain confidence in other parts of your life. When you know that you have enough money for the rest of your life, you are put in a position where you can make bolder decisions, do things that you've always wanted to do and take actions that a fearful person would not be able to.