Why Focusing On Saving Money Doesn’t Work – And What Your Intention Should Be

Why Focusing On Saving Money Doesn’t Work – And What Your Intention Should Be

Posted by on Apr 26, 2010 in Financial Freedom

As I browse various websites on financial freedom, it strikes me that so much focus is put on ways to save money.

In fact, there’s more focus on saving money than there is on earning more money.

I personally think that’s a wrong approach for two reasons:

1. If you think about saving money, then you’ll definitely see yourself lacking money at some point in the future. You assume that you need to save money now so that you will have it when problems arise.

You’re already creating problems in your mind, which creates issues in the future, AND that puts you in a state of stress all the time – anticipating something negative to happen at some point.

When people do this in sports (tennis, basketball, skiing, you name it), that mental stress causes loss of focus and actually affects the body, which now is in even greater tension.

The athlete now creates mistakes because he is in a negative state (mind and body are not working at their peak level of performance).

My belief is that the same thing happens in life, except slower. A tennis player in a negative state will most likely miss the ball (or hit it very poorly) in the next second and the cause (fear, stress) and effect (mistake) will have an obvious connection.

In life it takes longer and we often miss the cause of the negative results we encounter – because the cause and effect may be months apart.

But THERE IS a connection and there is a cause for your negative result – and it comes from a negative mindset and wrong actions you took.

So how is it good and useful to be thinking about saving money in the long term?

Consider this hypothetical question: if you were guaranteed to receive $10,000 every month for the rest of your life, would you save money systematically?

Most of you will say yes because you can’t really visualize a guaranteed income of 10k for the rest of your life. But try really hard to visualize that and how your life will be – if you never again have financial stress.

Would you systematically save money?

Systematically meaning that you would save some money for the future when you’d need it more – like in a special bank account or by buying real estate or by investing in stocks and so on.

I assume that your answer would be no. “No, I wouldn’t systematically save money – if I’m guaranteed 10k per month forever.”

You would definitely save some money anyway because you wouldn’t spend 10k in a month and there would always be money left (if you have a reasonable person’s spending habits).

If you agree that you wouldn’t systematically save money, then you must realize that your current plans to save money come from not believing that you will earn enough money every month. (so that there’s no need for extra savings)

And if you don’t believe that you’ll earn enough money, then you really won’t. You’ll self sabotage yourself along the way – so that reality will conform to your beliefs.

So obviously this is not the right mindset to have. But there’s another aspect to keep in mind: I personally don’t like worry. It makes me feel apprehensive.

So why would I perpetuate something (thinking about saving money) that makes me feel bad, causes me long term stress and doesn’t bring positive results?

2. The other approach is about earning more money. It’s about earning enough money through various ways of income that will guarantee $10,000 and more every month for the rest of your life.

If you’re not there, you should strive for that.

That should be your main intention – and NOT saving money.

Now imagine (if you’re not there yet) earning $10,000 (and gradually more) every single month for the rest of your life. Keep that image in your mind for a minute and see how you feel.

Good, right?

You are now entering a positive state – you have a clear goal and your body feels energized.

You feel: “Yes, that’s fantastic! It’s liberating!”

Your performance – whatever you do – in this state is at the peak of your mental and physical abilities. You feel good and you are focused and very productive.

Isn’t this much better than feeling stressed and worried? Aren’t you going to reach your goals much faster than in the first instance?

I am quite positive that you will.

When it comes to a home based business where you create website(s) with quality content and help people solve their problems (improve their tennis technique or choose the right vacuum for their home), you can progress fairly quickly in terms of income – as long as you put in focused and disciplined efforts in a longer period of time.

The start of the journey is not that motivating, since it typically takes at least 6 months to start earning over $100 per month, but that earning curve starts to go up faster and faster, up to a certain point.

Earning $2000 per month in passive income is a very realistic goal after 18 to 24 months of working on an online home business.

Based on my numbers, you can double that income every year. Which means that after 4 or 5 years of focused work on your home based business, will easily earn you $10,000 per month.

The key here is that the $10,000 per month will keep coming into your accounts whether you choose to work extensively on your sites (in which case the income will grow even more) or whether you choose to spend 3 months in South East Asia on holidays.

That’s the magic of the Internet.

Let me be a little blunt here – but this is how I say it to my friends: “If you are so damn lucky to be born in the Internet age – as opposed to any other age in the history of mankind – and you do not take advantage of the earning potential and the possibility to free yourself from the rat race and slavery, then this is the stupidest thing in your life that you’ll ever do (or actually not do).”

In closing, consider this: if you would spend all the time that you use for calculating how much to save, where to save and everything related to saving money – and rather focus on brainstorming how to earn more (and where to actually invest money), what do you think long term results would be?

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    17 Comments

  1. Tomaz, thanks a lot for this article.

    I know people who spend a huge amount of effort in order to save tiny amounts of money, not only in business but in all aspects of their lives. Obviously, if one calculated the economic value of their time it would not make sense to spend an extra 45 minutes traveling to a supermarket on the other side of the city in order to buy cheaper lettuce, but they do so anyway.

    In my own case, the parts of your post that I most relate to are your insights about stress and loss of focus. In addition to the self-sabotage that negative thinking can cause, it can be an enormous waste of time and mental energy.

    As I work on my Internet business, your website is my number one source of inspiration to help me stay focused and positive.

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  2. Nice job, Tomaz..

    “Unlearn what you have learned”.

    I think making the shift in your mind to not operating from a place of worry and insecurity to a place of welcoming change and insecurity can make changes in your life.
    Its good to break out of your comfort zone and try a new job, new hobby , not being afraid of new things..

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  3. This post is worth saving in your Delicious account to return to weekly, monthly or however often you need that reminder on the power of your thinking.

    I’m a big believer in how your thinking affects your life’s financial outcome (and all outcomes). The act of thinking about saving money instead of ways to accumulate more money is quite subtle.

    I never quite thought about it that way before. Saving money assumes you won’t have it in the future, which will cause stress and worry.

    Stress and worry takes away from that positive mind-set needed for success. I can’t say it as well as you, Tomaz, but I’ve got the meaning in your message and it’s clear.

    This post is worth printing out and keeping it in the forefront of your consciousness.

    We ARE lucky to be living in this internet age.

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  4. Tom, you should start to put a ‘Like’ button in your posts; I’d love to share this to my FB friends.

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  5. I absolutely agree, great post. Many people realize this after so many years of lost time. In fact right now am doing all I can to persuade people I know to start an internet business. But most want to see results first before taking the “risk”. They are seeing my results but will be 12 months behind….I did be glad if they get to start at all.

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  6. I couldn’t have said it better! Excellent, Excellent, Excellent post! I’m going to forward it to my wife (I always have a hard time that our focus should be on producing more versus conserving).

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  7. Hi Tomaz,

    I couldn’t agree with you more. Your perspective is exactly what people need in this troubled global economy.

    People think saving is the answer, but it keeps them in a perpetual state of lack.

    I myself have been practicing the opposite state of saving/lack by focusing all my efforts and thoughts on activities that create perpetual abundance and increased income.

    Yes, the internet is an amazing invention! Working on my online businesses is how I plan to create a legacy of perpetual wealth for my children. My little 8 year old daughter already wants me to teach her how to create her own website so she can share her reviews of certain kid products. I am not worried about her financial future 🙂

    Best,
    Grace

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  8. Tomaz,

    Absolutely great post. This topic is near and dear to my heart.

    Those financial TV commercials aimed at stressing us out by asking the questions “Do you have enough saved for retirement?” have always driven me crazy. I know they must stress out a lot of folks.

    Instead of asking how much money do I need to save in order to retire, the question to ask is how much (passive) income I need to make per month to live the life style of my choosing.

    Your part about being “blunt” is awesome! Love it. I tell my close friends something similar. They just don’t seem to get it.

    I’ll be printing this post and hanging it by my desk.

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  9. “If you are so damn lucky to be born in the Internet age – as opposed to any other age in the history of mankind – and you do not take advantage of the earning potential and the possibility to free yourself from the rat race and slavery, then this is the stupidest thing in your life that you’ll ever do (or actually not do).”….I loved this part…Great post Tomaz!

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  10. Keep keeping it real. I am starting to see that upward trend of money. I want the problem of figuring out how to spend it. I don’t want to worry about saving it!

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  11. A poster on the SBI Forums made a good point in a thread about earning $1,000/mth with an SBI site, and how long it would take.

    He said that if you had $500,000 in the bank earning 2.5% (which would be high right now), you’d be earning about $1,000/mth.

    Which is easier and faster: saving $500,000 from your job, or starting a site than makes $1,000/mth? Would it matter if it took you two years for your SBI site to make $1,000/mth?

    How many coupons would you have to clip and ziplock bags rewashed to save $500,000?

    In a fraction of that time, you could create a website that earns $1000/mth.

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  12. Great post.

    I was wondering if any ppl here are spending money on outsourcing? If yes, it would be interesting to know how much you are spending?

    Would you be willing to spend say as much as $3k/mth to build a VA team to work on your sites?

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    Tomaz Reply:

    Thanks everyone for the kind feedback!

    I’ve added the Facebook and Twitter buttons to the Social bookmarking buttons below each post (thanks Adi for the reminder) – so that you can share a post that you like with your friends and followers.

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  13. “Now imagine (if you’re not there yet) earning $10,000 (and gradually more) every single month for the rest of your life. Keep that image in your mind for a minute and see how you feel.”

    It’s called visualization, and it works for professional Athletes, and even drug addicts for overcoming their addiction.
    I have personally helped cancer patients with this technique, and it created some unbelievable wonders.
    If it works in these extreme cases, it sure can get you to the place you want to be financially.
    Thanks for reminding us, Tomaz!

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  14. “If you are so damn lucky to be born in the Internet age – as opposed to any other age in the history of mankind – and you do not take advantage of the earning potential and the possibility to free yourself from the rat race and slavery, then this is the stupidest thing in your life that you’ll ever do (or actually not do).”

    I agree 100%, that is why I’m never giving up.
    I’ve tried to help friends, even offering hosting, all they have to do is write content, but I end up wasting my time. Some people are more comfortable as employees.

    I’m consistently making $1,000 a month and I invest couple 100 each month into more articles.
    By next summer want to be at $3,000+ per month.

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  15. Wow! this is a very inspirational post. I am never dissapointed when I come to your website and read your posts. I always learn a lot from here and SBI forum posts from you.

    This reminds me what I realized when I brutally failed on my first website outside of SBI (Adobe Tutorials). I even went to the point of thinking about writing a website about saving money.

    I realized then it wasn’t about how much money I can save because that is a useless endevour just like my 401k plan. I realized that if I need money then I need to make more of it!

    I also learned this while reading an overview of that rich dad poor dad book. It is all about the mindset of many people that they need to do the old thing of saving money and never getting anywhere. When in reality they should be focusing their efforts on making more money.

    This has truly reminded me once again that I am on the right path and I can succeed, but only with time and hard work!

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  16. Thanks for this article. Changes my viewpoint on money as I have been one of those people to concerned about saving vs finding ways to make more. I have it now! Thanks a bunch!

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