Building a Path to Financial Independence

Start by first saving for yourself each month.

By Ike S. Trotter, CLU, ChFC, RICP, AEP

There are those who will tell you that if the world was perfect, everyone would have the same financial opportunities and live a life of comfort and happiness, with no monetary concerns.

But the world is not perfect. All of us, regardless of financial status, possess good as well as bad traits. Occasionally, luck may come our way, but most times it doesn’t. And even though we often make good choices in life, on occasion, we also make mistakes, and from these mistakes, life dishes out the usual punishment.

One of the most elementary, yet fundamental, tenets of financial planning is that you don’t invest until you have adequately saved some money. But unfortunately, saving continues to be a real dilemma for the average American wage earner.

When I began my business career some 45 years ago, I was taught a very basic financial lesson by our great NAIFA legend, Tom Wolff. The lesson goes something like this: There are those who will spend their income each month and then save what is left at the end of the month. However, there are those who commit to saving a certain portion of their income on the first of each month and then spend the balance. As only Tom could express it, those in the first category usually end up working for those in the second.

Building A Better Financial Future

As financial professionals working to secure a sound financial future for our clients, how do we turn things around? How do we commit to a bright financial future for ourselves, our clients and their children?

I think it starts with adhering to the discipline of saving for yourself first each month. This requires a budget to be instituted through which we pay ourselves “first” each month, instead of paying ourselves last.

Here’s an idea worth exploring: Begin this process by looking at the mirror each month and asking yourself a few key questions, such as:

• “How much can I pay myself each month?”

• “In order to be where I want to be financially in five or 10 years, what will it take to achieve this goal?”

• “Can I commit to this goal and resolve to stick with it?”

This plan may entail saving only $10 a week, but we must remember that every great accomplishment starts with a first step.

We must also remember that Rome wasn’t built in a day—and neither will turning your financial house around. Are you ready to take that first step you’ve been planning to take but have been putting off each year?

To my way of thinking, getting ahead financially today requires skillfully setting goals and understanding the rules of how money can work to your advantage.

Those who put up with a little sacrifice today can go a long way towards building the financial momentum they need to get ahead financially. With times being what they are today and a new year right around the corner, the lessons taught by Tom Wolff still work if you put them to good use.

Ike Trotter, CLU, ChFC, RICP, AEP, is a well-recognized NAIFA advocate and operates his own planning firm, IKE TROTTER AGENCY, LLC, in Greenville, MS. A 45-year veteran of the financial services business, Trotter also serves on the Editorial Advisory Council of Advisor Today.

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