Financial success is not only about money…its about your happiness

financial success and happiness

“Successful people believe I create my life. Not so successful believe “Life happens to me”.

What is financial success? Is it earning more Income? or is it all about generating best returns out of investments? I have seen many people calling themselves well settled in life but still struggling with their money matters. Well settled for them is to have enough money so they should not be bothered to spend wherever they want. They want to have best of the best luxuries in the world, want to go on exotic holidays, want best education for their kids, best location house etc. And in the search of best they don’t shy away from taking loans, in fact there so called well settled status gets them the loan they want. And here they start with their first step towards financial stress, which they are actually presuming as financial success. This does not end their search for best. As most of their income is going into expenses towards managing their lifestyle they are left with very little surplus and thus starts looking for best investment products which generates them best returns and when they don’t get the returns they expect, leads to financial stress.

What is Financial success?

Achieving financial success actually means when your money begins to work for you and starts generating more or equal to what you earn. You may call it financial freedom too. You are financially successful

  • When you can buy your desired car without even thinking of Car loan,
  • When you can go on exotic vacations without converting the expenses into EMIs and worrying about your next month pay check
  • When you can comfortably pay towards your parents medical expenses without stressing your family budget
  • When you have control on your spending and know what to spend, where and why.
  • When you spend time on improving your employability rather than hopping jobs to find a suitable/high paying option.
  • When you know that in your absence your partner will take care of money matters confidently.
  • When you know that the education you are buying for your children will make them a good human being besides a good professional.
  • When you know that even if your income flow gets interrupted still there’s something to take care of important expenditures

Attaining financial success is not a rocket science. You just have to do the same things you used to do while you were in school. You had a goal, you were focused on that goal, you studied with discipline and you knew there is no short cut to success. You have to study hard to clear competition/entrance exams or get into good college and the like. You have a mentor, you have a defined curriculum and you know what to achieve.(Also Read Financial planning case Study)

Parag Parikh in his book on behavioral finance wrote:

“Successful people are simply those who make a habit of doing what unsuccessful people don’t like to do. And what are the things that unsuccessful people don’t like to do ? They are the same things that successful people do not like to do , but they know that these are prices of success..” People fail because in life they do what is fun and easy rather than what is hard and necessary. They do what is tension relieving rather than goal achieving.

This is true in financial life also. The inability to delay instant gratification lead people to look out for loans while buying not so necessary products. Investment for them is to make short term profits. Unlike school college days, now they are on their own so discipline is something the thing of past and is meant for their children to have. They treat spending as their right and saving as obligation. Without any goal in mind they start with long term investments and withdraw for short term desires. Using credit cards is something that excites them.

But in all this they don’t realize the after effects of such behavior. They are slowly moving towards financial disaster and not financial success. Below are some of my thoughts on how one can achieve financial success. You can look at the life of any financially successful person and see them following these 3 steps in their lives.

1. Where you want to go? : First thing first, spend time on yourself. You should know what you want to achieve in life. What are the things that will give you peace of mind, will keep you happy and are important in your life. Financial life is a part of your personal life and there are many things that money can’t buy, but still money is required for many things. In short Set goals and write them. Written Goals will give you a clear cut idea about what to achieve.  Also set a timeline to achieve those goals.

2. Where are you right now? : Organize your financial records at one place to figure out what have you done with your money in previous years. Note down all your bank balances, Insurance policies, investment details, loan schedules etc. Also note down how much, where and for what you had spend your most precious thing i.e. your time.

3. How to reach where you want to go? : This is like when you have decided to appear for any competitive exam, which books you should start reading and what strategies to follow to clear the exam. In achieving financial success you have to embrace yourself with the concepts of Budgeting, Cash flow management, Insurance and risk management, Investments, Taxes and Estate planning etc. These are some technical names of simple things. You must be hearing some of these names in your daily routine. Here again you can either do it yourself by studying various books on these subjects or following some blogs and asking questions on forums, also by attending presentations and seminars on these topics. Or you can also engage a Certified financial planner and Registered Investment adviser who can hand hold you, make you understand the concepts, pin point the mistakes that you are  making and design a road map which you can follow to reach out to your goals.

As they say. “Successful people constantly learn and Grow and not so successful think they already know”

Your financial goals and personal goals should be looked at simultaneously. Say for e.g you want to spend more time with your kids or parents, but in that case you have to look out for job where you may have to compromise on your income. You have to understand the impact and chose what will make you happy. 

Unlike your competition exam where you have to compete with others and come out with flying colors, in achieving financial success you have to compete with your own habits and behavior. The results cannot be measured in numbers alone like how much wealth you have accumulated, what return you are getting out of your investments, but how organized and peaceful your life has become. How confident you feel about your future. You will see a jump in your happiness index.

(Also Read : 8 financial planning tips to make your finances happy)

The only sacrifice you have to make in achieving financial success is to come out of your comfort zone and ready to accept and improve on to your mistakes if any. It may bother you for sometime, but once it becomes habit, you are on your path to financial success.

I am wondering what you think of financial success. Tell me about your views in the comments section below. 



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