I read a rather plaintiff and disturbing newspaper article recently which eloquently describes the financial and emotional impact that redundancy can have on a family.

Entitled ‘Jane’s husband doesn’t have a job any more…..and she can barely live with the shame’ it was written under an assumed name, Jane Simmonds, a freelance writer whose husband was made redundant and  has been seeking work for the past  four years.  During that time he has had just two contracts that lasted only a few months.  He also picks up the odd day or two from time to time.

The husband she refers to as Andy is very well educated with a History Degree from Cambridge, a Masters degree in Business and years of senior corporate experience in strategic management. So it’s not really surprising that he rejected his eight year old daughter’s suggestion that he could become a bus driver!

The article provoked a lot of online response; some was supportive but inevitably there were lots of spiteful comments as is sadly typical these days. But that’s neither here nor there.

There is no way that I plan to sit in judgement of Andy’s attempts to find a suitable job as I’ve never met him and know nothing about him other than what his wife tells us. So whether or not my following thoughts may be applicable to him I’ve no idea…..but they may well be applicable to you.

To give a little more background it’s worth mentioning that:  “Head-hunters are still calling with job opportunities. Sometimes they call a lot – three or four in one week. Sometimes there’s nothing at all. Each call is a possible way out of Andy’s predicament. Each possibility is researched in obsessive detail, prepared for like an Olympic marathon.”

And it’s the last sentence about preparing that got me thinking.

Is Andy missing the point?

People are more influenced by who you are rather than what you know.

That’s not to say that doing some research is not a good thing….of course it is.  But the key to success in any situation where other people are involved is how and what you communicate.

In a recruiting situation that may well mean coming across as someone it would be a pleasure to work with and to have on the team.  Not everyone is blessed with great looks, a compelling voice, a natural charm and a spontaneous wit. And you can’t fake those qualities either. However you do have attributes that attract people or you’d have no friends and you’d be leading a loveless life.

So what are the things that people like about you?

Don’t get too hung up on passing psychometric tests and rehearsing your answers to questions you expect to be asked if you are going to a job interview.  Think more about just being you.

I know that’s easy for me to say. I’m not looking for work.  However this is vital advice. I spent many years in a sales environment where I was paid on a commission only basis, so I know that you’ll never make a sale if you appear over keen or desperate.

What’s selling got to do with getting a job?

Everything!

We are selling ourselves constantly. Being hired is exactly the same as making a successful sale. And people buy people first……they buy from people they like.

One of the most important things I learned early on in my sales career is that a sale is more contingent on the attitude of the salesperson than the attitude of the prospect. Put another way that means you have to go into any situation where you need to influence the outcome expecting to do so. That doesn’t mean wishing or hoping…..it means genuinely expecting.

Not being cocky or arrogant of course, but simply quietly confident and relaxed.

Clearly if you’ve spent four years getting knocked back as Andy has, it will be a monumental task to suddenly become sure that the next interview is going to be the one that lands him a job. But something in his approach has to change…..and my guess is that he needs to concentrate more on how he projects himself as a person rather than trying to impress with his knowledge and background.

That’s true for all of us all of the time.

In the recruiting process the interviewers have a need. They are looking for the solution to a problem. They want to make the right decision. If the candidate is appropriate in terms of fulfilling the skill requirements, and this would in all probability have already been established from the CV, then all he or she has to do is to demonstrate that they are the solution to the problem and hiring them would be the right decision. This is no different from any sales negotiation.

So the lesson is, learn to sell yourself!

Note: You can read Jane Simmonds’ article if you Google her name or ‘Jane’s husband doesn’t have a job any more’

And good luck Andy!

Recently I read an article by Wolfgang Riebe who is a motivational speaker from Germany.    (Yes….came as a big surprise to me too!) .

He talked about a visit he had made to Iran and how impressed he was by the many kind and pleasant Iranians he met while he was there. He had expected something quite different. 

This got me thinking about how easy it is to fall into the trap of making totally false assumptions resulting from our misconceptions and prejudices.   We often make snap judgements about people based on where they come from, how they dress, how they speak etc. without knowing anything about them at all.  Simply as a result of our preconceived ideas and some propaganda we might have been subjected to.

I have to confess to having done so myself on far too many occasions.

Now obviously there are plenty of occasions where our first impressions turn out to be totally justified. But we’ve all had experiences where people have proved us completely wrong once we’ve got to know them.

Many years ago I had a similar conversation with my eldest son who, at the time, was going through a rather strange ‘punk rocker ‘stage. During that particular phase, in my eyes at least, he looked horrendous. My wife and I used to hope the neighbours weren’t too scared! 

However, of course, we knew him to be a fine young man who was kind, considerate, polite and great fun.  My real concern was how other people would perceive him.  At the time he was about sixteen. A few years later, I’m delighted to say, he could easily have become a photographic model for any of the top fashion magazines of the time.

There are two very important points that I’d like to make here:

Firstly, whether we like it or not, people are going to form judgements about us within a few seconds of meeting us for the first time. That’s an absolute certainty.  What’s more, once those judgements are made it becomes very difficult to change them.  We’ve all heard the expression that “You only get one chance to make a good first impression”

It’s true, and you should always be aware of it. That doesn’t for a moment suggest that on meeting someone for the first time you should be anything other than yourself. Just be conscious of the fact that while you are forming an opinion about them they will be doing the same about you.

Secondly, and this is something that has become more and more evident to me over many years, is the fact that people will almost always respond to you in a similar way as you behave towards them.

You can make life so much easier for yourself by being a pleasant person to be around. Showing interest, giving consideration, being friendly and polite, listening, maybe using humour if appropriate and sharing the warmth of your own personality will be reflected back to you many times over.

Actually many people will be in shock and certainly they’ll remember you for all the right reasons!

The hidden strengths of people are brought out by ‘good finding’ not ‘fault finding’. Giving praise where it’s due and showing gratitude will have a much more positive impact than unnecessary criticism or indifference.

That doesn’t mean that you should ignore poor performance or lousy service.  By all means stand your ground where the situation demands. However you’ll induce a more favourable outcome in most cases by choosing your words carefully and criticising the performance rather than the performer wherever possible.

Nobody wants to be made to feel small or inadequate.

So wherever you may be in the world, be it Iran or anywhere else, including your own back yard, people will treat you in much the same way as you treat them.

Most people go through their life starved of an occasional pat on the back or a feeling of being appreciated.  So give a few people a treat whenever you can.

Remember that what you give out in life has an uncanny knack of coming back to you.

There’s no need to go to Iran to become convinced of this!

You probably have school day memories of chanting “two, four, six, eight…who do we appreciate?” and then spelling out the name of your school team. 

This came to mind after reading in the papers all the glowing tributes paid to two great sportsmen who recently passed away within a few days of each other.

It made me consider how wonderful it would have been had they heard all that sincere and richly deserved praise before they had died.

Recognition and appreciation are so important to each and every one of us whether we care to admit it or not. And yet we so often overlook the simple gesture of telling people that we appreciate them.

A few days ago I read an article regarding a poll of 9,000 workers in 52 countries which sought their feelings towards their boss.

The British emerged as the most critical in the world. An astounding 41 per cent described their boss as totally incompetent. Only one in ten said that their boss is ‘brilliant’.

What a terrible indictment this is on the quality of management in this country!

Sadly, having spent many years involved with very large corporations this comes as no great surprise.

If my memory serves me correctly I believe it was Rockefeller, one of the most successful businessman the world has ever known, who said “Show me the man (today he would have said ‘person’) who knows how to successfully treat people, and I will show you someone who will go far in life.”

So let’s get to the point.  It doesn’t matter how knowledgeable you are about the business you are in or how skilful you are from a technical standpoint; the most important skill you can learn and develop, is the ability to lead and inspire the people who work with you.

If you don’t do that you will never be a great success.

Managing by fear, threats and intimidation went out years and years ago.

The great leaders of today intuitively understand the need to give recognition where it’s due and to say ‘thank you’ whenever appropriate.

So many people’s self esteem and feelings of worth would take a huge boost if they were on the receiving end of a bit of genuine praise and appreciation once in a while.

This isn’t confined to the workplace of course. We can all express gratitude to dozens of people every day; in our own family, amongst our friends and especially strangers who we encounter in everyday situations….at the supermarket, in a restaurant, a coffee shop, or wherever.

Last month I celebrated one of those ‘big birthdays’.  Since we have a son who is getting married in the Far East in a couple of month’s time we decided to postpone cracking open the Champagne until then, when all our family would be together.

So on my actual birthday my wife booked a table at one of our favourite restaurants for just the two of us.

Earlier that day I had spoken to my son and his partner and their little baby daughter on Skype from Stuttgart. Then I got a call from my son who lives in Singapore followed by a call from my other son who lives in Florida. Later that afternoon my daughter, the only one of my kids who lives in the UK, called me from Cheltenham.

You can guess what’s coming next no doubt!

We walked into the restaurant and were greeted at the door by the owner who we know well.  As we started to walk to our table I stopped in my tracks.  Lined up in front of us were all four of my terrific kids and their partners!

That evening was one of the greatest of my entire life….once I got over the shock of course. How my brilliant wife had been able to keep such a secret from me for so long I’ll never know! 

The wine and Champagne began to flow and for the next few hours my family were so generous in the things that they said and the sincerity in the way they expressed their feelings.

It was a truly humbling experience and I will cherish the memories of that evening for the rest of my life.

The message I hope is clear.  Don’t wait until it’s too late to show your loved ones and your friends how you love and appreciate them.  And look every day for the opportunity to make someone else’s day simply by saying ‘well done’ or ‘many thanks’.

I recently watched the TV documentary ‘Coldest race on Earth’ which followed James Cracknell, a double Olympic Gold Medallist,  as he competed in an incredible extreme cycle race across one of the most hostile places on the planet…. the frozen Arctic Yukon Trail.  Over seven hundred kilometres in temperatures well below minus 40 degrees Celcius. It was painful to watch and although I have huge admiration for his commitment, strength and endurance I certainly don’t think he could have enjoyed the journey.

Previously I had seen the programme which followed him as he ran and cycled in one of the hottest places on earth….Death Valley California. Sadly that ended in a catastrophic accident when he was hit on the back of his head from behind by the wing mirror of a truck that passed him at around 75 miles an hour.  He almost died as a result.

Thankfully he is continuing to recover and the recent race in the remotest part of Northern Canada was apparently his way of determining if he still has the mental ability to face and conquer these amazing challenges he sets himself.

There is of course a reason for me mentioning this. 

This series of articles I’ve been writing is also about a journey……your journey.

This is the journey which will take you from where you are today to where eventually you would like to be. It may be a fairly long journey and so it’s important that you enjoy it. But this isn’t a race. There’s no great rush. It’s not an endurance test.  Though to make it a great journey you will have to practice self discipline and determination.

In itself success is not a destination. You may well extend your horizons as you go along. Success is what you will begin to enjoy as soon as you take off in the direction you want your life to go.

There will inevitably be some challenges along the way and some setbacks to contend with. Nobody will be immune from that. But with your positive attitude and boundless enthusiasm you will deal with each and every one of these and you’ll continue to move forward. And there will be lots of occasions where you will feel fantastic as you achieve many of the short term and mid-term goals you have set yourself along the way. Savour those moments when they occur. You will have earned them.

Treat every day as a new adventure.  None of us know how many we have left. That’s why we can’t have a final destination.  It’s the journey that counts.

I’d like to share a few more thoughts with you which I hope will assist you in making your ‘journey of a lifetime’ a brilliant success, so watch this space!

Nowadays I generally shave with my eyes closed because when I look in the mirror I think it’s my father looking back at me!  That’s what happens when you’ve got a few ‘miles on the clock’.

The reason I mention this is that I’d like you to describe to yourself the person who looks back at you when you stand in front a mirror. 

Whatever your answer, you can be sure that you reflect to a significant degree, the environment in which you were raised and the influence your current environment is having upon you today.

When you were born you had no control over your circumstances and the way in which you initially were brought up. It was purely a matter of chance. But as you became older it gradually became a matter of choice.

The problem is that many people allow the choices they make in adulthood to be determined by the input they received as a child.  That’s fine if you were subjected to positive and wholesome attitudes and behaviour.  It’s a well known fact, for example, that many of our doctors had one or even both of their parents who were doctors also.

We also know that many people who run their own successful business came from a business background and had fathers who were successful businessmen. (Nowadays there are many very successful women who are running great businesses, but that would have been an exception a couple of generations ago.)

Sadly, on the other side of the coin we now see families that are on the third generation of living on benefits where nobody has ever held a real job.  We are only too aware that every city and large town in the UK has an area that’s run down and deprived, which is a breeding ground for delinquency and crime.

So don’t underestimate the part that environment has played in where you have been and where you are now. 

There will always be examples of those who seem impervious to where and how they were raised. Multi-millionaire business owners, or famous celebrities, who have risen to great heights regardless of their background; but upon reading the autobiographies of such people it almost always becomes apparent that some event took place when they were still young that altered the course of their lives.

Of course it’s intriguing how two or three children born to the same parents and sharing the same upbringing can so often have such different personalities.  But even though they may be at different ends of the spectrum where their characters are concerned you can be pretty sure they will have developed similar values, standards and beliefs.

If you were fortunate to have enjoyed a happy childhood then I’m sure you are grateful and have benefitted as a result. But if you have painful memories of your early years, for whatever reasons, then although you have my sympathy it’s vitally important that you consign those memories to the past where they belong. Don’t allow the things you can’t change to have a detrimental effect on your future.  It’s time for you to ordain your own destiny.

What’s much more important is the role that your current environment will play in determining how you live your life.  It will influence your attitude, your behaviour your aspirations and all the choices you make.

This is why it’s critical for you to be very selective about all the things that will have an influence upon you.  Make no mistake; we are all being influenced every moment of every day.  What we read, who we associate with, what we watch on TV, what we listen to on the radio, what we do in our leisure time….all these have a huge impact.

Of course we filter much of this in accordance with what our beliefs and perceptions are. However are you sure that you’re not filtering out some of the good stuff and taking on board some of the messages that may be potentially harmful?

Once again this brings us back to how we see ourselves or our ‘self image’.  It’s almost a chicken and egg situation.  Our self image determines how we respond to our environment and how we choose the environment in which we feel comfortable. And our environment affects our self image!

In the same way that we need to be aware of what we eat and put into our body if we want to look and feel healthy, we also have to be very aware of what goes into our head.

Positive thoughts bring about positive results.  We’ll talk more about this in a future article but let’s stay with environment and habits for the moment and how they influence the choices and decisions we make.

Habit is such a key factor in determining how well or otherwise we live our lives. We are all creatures of habit.  The only way to get rid of a bad habit is to replace it with a good one.

And habit is in reality an expression of choice. The problem is that by definition we do things habitually and never think that we are choosing.  For example, every time a smoker lights a cigarette he or she is exercising choice.  But to the smoker it’s seen as a habit. So the choice is being made without thinking, or in other words, sub-consciously.

It’s the same with procrastination… being late for appointments and meetings….laziness….overeating…. over spending…..drinking too much….the excessive use of bad language….indecision…telling lies….putting people down… putting yourself down… expecting the worst….etc.etc.

But you can change bad habits into good habits through conscious choice!

Choosing carefully all the different things that make up your environment and the various people who influence you, coupled with choosing to adopt good habits and eradicate the bad ones, will have a profound and lasting positive effect on your life.

Let’s be really honest with each other.  Wherever we are today is almost entirely down to ourselves.  I would like to believe that you aren’t someone who seeks to blame everybody other than yourself when things go wrong in your life.

Of course we can’t entirely dictate all the outside influences and circumstances which may affect us; but even when disaster occurs over which we have little or no control, it’s still our choice as to how we respond and react.

The greatest power that you and I have is the power to choose.

Now here’s the critical point:   It’s my belief that are three factors that influence most of the decisions and choices we make….especially the important ones.

The first is our ‘self image’.  This is the way we see ourselves and who we perceive ourselves to be.

The second is the habits we have formed.

The third factor is our environment.

Let’s take them one by one.

Self Image

Many years ago when I was running a large sales organisation I struggled to understand the reasons why people would behave in such different ways, even when the circumstances were the same. The answer eluded me for a long time.  Then one day I read a book written by Dr. Maxwell Maltz.  It was a truly ‘Eureka’ moment in my life.

Suddenly I was able to understand why some people succeeded while others continually failed, even though they had received the same training and were given similar opportunities.

This is what Maltz taught me, and I quote:  “All your actions, feelings, observations – even your abilities – are always consistent with your self image.”

To give you some idea as to how much importance I attach to this single revelation I have kept the same small card inscribed with this quotation for over 30 years!

So what does this mean to you?

Simply this; you have to begin to focus on all your positive attributes and start to feel good about yourself.  Remember that the word ‘image ‘doesn’t mean reality.  You can change an image. 

The way you currently perceive yourself is a result of all your experiences to date.  The things you were told and things which have been said to you, especially as you were growing up

 You’ve also been influenced by the expectations that people, such as your parents and some of your school teachers, may have had for you.

If these expectations were low then in all probability your own expectations may be low also….simply as a result.  But you can change your expectations. There is absolutely no need for you to become a prisoner of your past.

It’s vital that you develop high expectations of yourself because you will eventually live up to them…or down to them.

Please take time to question the validity of how you think about yourself. If you are positive about your abilities and where you feel you are headed that’s great!  But if not then now is the time to change your attitude towards yourself. And you can.

Now here’s a very important question for you, and before I ask it I’d like you to get a piece of paper so that you can write down a name.

Got it?  Good.

This is a question that I often asked when holding career development courses with groups of employees that we wanted to prepare for greater responsibilities.

OK here’s the question.

“Of all the people you know, who is the person you talk to the most, confide in and share your innermost thoughts and feelings with?”

Write the name of that person down on your piece of paper.

When I’ve asked that question in the past the most common answer for a female was either her mother or her best friend.  Men would probably choose either a brother or sister or a very good friend.

Interesting but wrong!

The name you should have written down should have been your own name of course!

We are talking to ourselves constantly. And we believe what we hear. And we will act accordingly.

It’s of paramount importance that in order to have more self confidence and improve your self esteem you have to think positively about yourself.  That doesn’t mean you should be delusional and have a totally distorted opinion of yourself. It means that you should become a ‘good finder’ rather than frequently finding fault with yourself.  Celebrate your victories and forgive yourself for your failures. We all have failures!

Recognise your strengths and resolve to work on your weaknesses.

If you concentrate on feeling good about yourself and giving yourself positive feedback you will quickly begin to have a very positive effect upon your ‘self image’. 

This will have an amazing effect on the choices you make.

We’ll talk about habits and environment in the next article.

I’ve done some stupid things in my time and made some really daft decisions too. It makes me wince even now when I reflect on some of my more embarrassing episodes.

But I like to think that I learned from those mistakes…and seldom made them twice. It comes as a surprise then when I encounter people who seem to have developed into an art form the ability to make the same mistakes over and over again.

It’s all to do with choice.

Every day each of us are faced with a multitude of decisions and choices.  Most of them are trivial and not likely to have serious repercussions either way.  It really doesn’t matter much what you decided to have for breakfast or decided to wear today.

You could easily have tossed a coin to help you choose.

There are however many decisions we are faced with, some regularly and some just occasionally, that deserve a great deal more thought than a flip of a coin because you could be gambling with your future.

Even when we were much younger and still at school we became familiar with making choices. For example, the friends we made and whether homework was more or less important than watching TV. (Nowadays playing computer games or spending hours on Facebook is the big temptation.)

Naturally at that stage in our lives we were far from being totally responsible for ourselves as most of the decisions were made for us.

Nevertheless the choices we were allowed to make were, even then, beginning to determine the shape of our lives.

Then we grew up and left home.

And where you are today is primarily a result of all the choices you have been confronted with and the decisions you have made from that time up until now.

Too many people look around for somebody or something to blame if things aren’t going their way, when in reality the fault lies squarely on their own shoulders.   Regardless of what setbacks you may encounter from time to time it’s how you deal with them that impact the eventual outcome.

 And that’s a matter of choice.

Here is just a short list to illustrate the point.

• Every day you can choose to be positive or negative.
• You can choose to look for the good in somebody or look for their faults.
• You can be organised or choose to live your life in chaos.
• You can choose to build your reputation for being reliable or unreliable.
• You can choose to put some enthusiasm in your life.
• You can continue to study and learn, or remain as you are.
• You can choose to spend more money than you earn or choose to save some of it.
• You can choose to smoke or not to smoke.
• You can choose to eat healthily or be a ‘takeaway junkie’.
• You choose what you read.
• You choose who you associate with.
• You choose what you listen to.
• You choose what you want to believe.
• You choose how you behave.
• You choose how you are perceived by other people.
• You choose what you really want and expect from your life.

Now these are just some of the issues that will ultimately determine what kind of life you will lead. How happy you are, how healthy you are, how fulfilled you eventually become.

But making the right decisions and choosing the right course of action isn’t that easy!

I don’t want to make it sound as if you can magically get everything right in your life from now on. There are some profound reasons why people continue to make poor choices and decisions.

No doubt you probably know someone who goes from one disastrous relationship to another and who regularly succeeds in choosing partners who may be abusive and damaging.

Why do they keep making the same mistake? 

Why are some people always broke and struggling with debt?  Why are some people always late for an appointment?  Why do some people have a hard time in telling the truth?  Why do some people make promises but seldom keep them?

Even though people genuinely believe they will change, and seem determined to do so, they rarely succeed.   How many people give up on their New Year resolutions before January is even out?

So what are the factors that determine our choices and the decisions we make?

In the next few articles we’ll take a good look at what has almost certainly affected you in the past and how you can confidently make better choices and wiser decisions in the future.

Let’s take a look at the financial situation of people in the United Kingdom today:

2% are exceedingly wealthy.

These are people who live in total luxury, probably own several very expensive homes, fly in private jets, possibly own a yacht and are featured every year in the Sunday Times Rich List.

Frankly I don’t aspire to have anywhere near that kind of wealth and I’m certainly not qualified to show you how to join this elite group.

5% are comfortably well off.  They live in a decent house with a small or zero mortgage, they drive a new car, and they take at least two holidays each year. They have enough money for most of the things they need, but they are not mega wealthy.  They have become financially independent and are free from debt, free from stress and free to choose.

Being able to join this group one day is definitely within your grasp.

53% are scraping along.  They struggle from payday to payday. They are just about keeping their heads above water but there is seldom any money left over for luxuries. Also, they live in constant fear of the large unexpected bill. They spend sleepless nights worrying about the future and are regularly lurching from crisis to crisis.

40% are in dire straits. Their past mistakes and failures have created a crippling burden of debt which they have not the slightest hope of paying back through working at a normal job. The crushing weight of their errors and the cumulative effect of years of overspending, wastefulness and lack of discipline have created a desperate situation. Each month the hole they are in gets deeper and deeper. Without urgent and immediate action, the outcome is inevitable. Total misery!

Now I’m pretty sure you would want to be amongst the top 7% in due course and, if you follow the plan, you certainly can be.

Once again I have to stress the fact that income from earnings alone won’t get you there….you have to start saving at least 10% of your gross income and invest it from today!  It’s passive income that makes people rich.

So here’s the plan:

1.       Take stock of your current financial situation.

Take a large sheet of paper or a notebook and in the left hand column make a list all of your assets. For example:-

• The current value of your house if you own one
• The current resale value of your car if you own one
• The total amount you have in the bank or in savings accounts
• The value of your investments in ISA’s, unit trusts, company shares etc
• The current surrender value of any endowment policies you may have
• The realistic resale value of the total contents of your home and all your possessions (be very conservative here, as the resale value will be much lower than what the replacement cost would be)

There may well be other things to add, for example the current value of your pension fund or any investment properties you may own etc.

Make sure you list everything you own as if you were about to turn it all into cash.

Then in the opposite right hand column make a list of all your liabilities.

• Amount of Mortgage outstanding on your house
• Mortgages outstanding on investment properties
• Credit card balances
• Personal loans outstanding
• Bank overdraft
• Hire purchase agreements
• Unpaid income tax or potential capital gains tax liabilities

Include any other liabilities you may have.

Then add up the two columns and deduct the total liabilities from your total assets.

Hopefully your assets exceed your liabilities and you have a positive net worth. But if you have a negative value then cheer up….things are going to get better!

If you are still quite young, and are just starting out, many of these assets and liabilities probably aren’t relevant to you at the moment…but they eventually will be. The principle here is to know exactly where you stand financially.  You should do this at least once a year either at the beginning of January or the new financial year on 6th April.

 2.      Start saving at least 10% of your gross income.

Regardless of your debts and the interest you may be racking up on them you must start to save now. Not tomorrow, not next week, not next month. Now!!!

You will only accumulate wealth through passive income; income that will continue to come in even if you gave up working.  And you achieve that by making money work for you. But you can’t do that without the money to put to work!

If you don’t already have a savings account then open one at a bank or building society just to get started.  I’ll tell you shortly what you can do as soon as you’ve saved your first £500.

3.      Do everything you can to increase your income.

The way to do this will depend somewhat on how you currently earn your living. If you work for a company then you may need to work hard for a promotion. If you run your own business then you will have to find ways to make it more profitable.

Maybe you could do more overtime? Or get an additional part time job?

Bear in mind that if you have taken on board the things we’ve discussed in the earlier articles in this series, then it’s not difficult to make a quantum leap in your effectiveness.  It may not happen overnight but eventually the law of compensation will kick in. You will earn what you are worth.

 4.      Look for ways to reduce your expenditure.

I’m not suggesting that you shouldn’t treat yourself occasionally. That’s fine. We want you to enjoy life!  There’s nothing wrong with spending money, but don’t waste it! Look for ways to reduce your utility bills for example. Check to see if you can get a lower rate on your mortgage. Shop around to get the best deal before buying something. Don’t buy things on impulse that you don’t really need.

 5.      Read the financial pages of your newspaper.

OK I know that reading Hello Magazine or GQ is more fun…but they won’t help you make money. They’ll just make you wish you had more money!

You do need to build your financial ‘savvy’.  I don’t recommend the Financial Times because that’s heavy going and is far more focused on business finance as opposed to personal finance. The personal finance pages in the Sunday Telegraph or Sunday Times or the Daily Mail are full of information you will benefit from reading.  It doesn’t follow that the advice is always ‘bang on’ but if you become a regular reader you will soon develop the confidence and ‘know how ‘to form your own opinions. There’s so much to learn…so now’s the time to begin improving your knowledge.

 6.      Invest wisely.

There are so many investment strategies you will come across as your interest in building your wealth continues to grow.

To give you a few examples the most popular investments over the years have been in the stockmarket, property, art, wine, and commodities like gold and silver.

Each has shown substantial returns over a sustained period during the last couple of decades. So where do you begin?

Before I answer that I must emphasise that all investment carries some form of risk; some greater than others.  As your savings grow so should your understanding of the opportunities and pitfalls in investing.  You’ll never stop learning.  It’s inevitable that you’ll make some mistakes too.

If you are only now beginning to amass some capital as a result of saving 10% of your income my strong recommendation is that you begin by investing in the stockmarket.  There are two ways to do this as a beginner.  One is through what is known as a collective investment where you allow a fund manager to select the portfolio of shares. The other is to select the shares yourself. Remember this is a long term investment plan you are embarking upon so you don’t have to get in a panic if the market falls. It will eventually come back up again sooner or later.

Whichever you choose to do you should use the tax free benefits of holding your investments in an ISA. Currently the annual allowance is £10,200 a year. You can pay monthly amounts into an ISA.

I use a company called Hargreaves Lansdown which has a brilliant internet facility for investing as well as giving stacks of free investment advice.

If you prefer to choose your own shares then I suggest you select shares that pay good solid dividends that you must re-invest.

There is a simple strategy for picking these shares that I came across about twelve years ago. The returns have been really excellent…averaging over 17% a year.  If you would like me to send you details of this very simple strategy I’ll be happy to do so.  Send me an email at dr@davereynolds.com and you’ll receive it by return.

 7.      Be patient.

You are not going to become rich overnight by following this plan.  But you will become rich.

Just remember this is a long term plan, not a ‘get rich quick’ scheme. The most important thing is to never touch your savings or any of the dividends or other form of income you may receive from your investments. Regardless of what crisis may occur from time to time.

You may find it difficult to believe right now but as your capital begins to grow you will really get into finding ways to earn more and make more. You’ll actually start to attract wealth in ways you can’t possibly imagine right now.

As evidence of this there are now quite a few investors who have more than £1 million in their ISA accounts through regular saving and astute (and possibly a bit lucky) investing.

There’s more to come on’ How to get from where you are to where you want to be.’

I’ll be back soon.

It’s often said that money doesn’t buy happiness. Maybe that’s true. But sinking under a mountain of debt is absolute misery. I know…because I’ve been there. Admittedly that was many years ago, but it’s an experience that I’ll never forget. Lack of sufficient money to pay your bills, and struggling to cope with your debts, can destroy your self esteem, your health and even your marriage.

It shouldn’t be that way and it doesn’t have to be that way.  Yet for a huge percentage of the population that’s the way it is.

Every week millions of people in the UK buy tickets and dream of winning the Lottery.  But if you were born and raised in the UK you’ve already won the lottery!  If you don’t believe me then you‘ve never witnessed the abject poverty and hopelessness that is the day-to-day life of more than half the World’s population.  Although you may not have witnessed it firsthand you’ve certainly seen enough fund raising and news programmes on TV to know this is fact.

People in the third world have little or no chance of escaping from the appalling conditions in which they live,  through no fault of their own; but anybody living in the UK who is  broke and in debt has only himself or herself to blame. 

They’ve spent money they didn’t have to spend; they’ve bought things they didn’t have to buy and they’ve succumbed to the temptation offered by easy credit.  In other words they’ve been living beyond their means.    This is exactly what I was doing when I got in a real mess.

If this is uncomfortably close to home, then it’s time to face up to the fact that you’re heading for disaster… unless you make some dramatic changes to your behaviour and your attitude to money.

Now I have to tell you right up front that I don’t know of any quick fix. I’ve yet to come across anybody who has got rich through a ‘get rich quick’ scheme regardless of the hundreds of appealing invitations I see on the internet. 

Over the centuries people have been drawn, like moths to a candle, to whatever the latest opportunity to become wealthy overnight may have been.  Thousands of people rushed to California and Australia when gold was discovered.  Most died penniless.

If you think there is something just around the corner that’s going to solve all your problems in the ‘blink of an eye’ you’re living in ‘cloud cuckoo land’.

But you can acquire wealth if you are prepared to discipline yourself and take on board a resolve to dramatically improve your current situation.

So here’s what you need to do:

First it’s vital to understand that you are most unlikely to become wealthy through what you earn. Even investment bankers, with their huge bonus payments, and premier league footballers, earning thousands of pounds a week, have been known to go broke. The key to accumulating wealth lies in saving some of the money you earn and putting it to work.

This is the most valuable thing you’ll ever learn on how to become financially independent.

And the time to start saving is right now……today!

Forget all the advice you may have heard or read about paying off your debts first.  Contrary to what it may appear, that’s not good advice.

Of course it makes logical sense to pay your debts before starting to save because the interest charged on debt is bound to be substantially more than what your savings will earn. So you may justifiably be asking why I believe it’s the wrong thing to do.

I’ll tell you why. It’s because logic doesn’t take into account human nature.  The fact is if you promise yourself you’ll seriously cut back on spending, and really make an effort to reduce your debt; you’ll almost certainly lapse back into your previous habits.  The only certain way to get rid of a bad habit is to replace it with a good habit.

So you need to start saving now regardless of any debts you have that need to be ultimately paid off.

If you are currently debt free that’s great…but you still need to get into the savings habit if you haven’t already done so.

You’ll only ever become financially secure by putting your money to work for you. It’s through asset appreciation that wealth can be accumulated.  And if you don’t save you can’t invest…..it’s as simple as that!

 There are two lessons I was fortunate to learn which have dictated my attitude to money since I was in my twenties and I simply can’t stress these two principles enough.

The first was something I learned from a small book written many years ago entitled ‘The Richest Man in Babylon’. The principle in this little book is so simple but will change your life if you follow it.

It goes as follows:

‘Ten percent of all I earn is mine to keep. I will pay myself first and invest it wisely’

That means taking ten percent of your income before any deductions for tax and National Insurance, and before paying rent or your mortgage or anything else. If you are older than thirty you really need to add a percentage point for every three years. So if you are 36 years old, for example, you should save 12 percent of your gross income.

With regard to investing I’ll cover this later. But initially just open a simple savings account at a bank or building society.  I know the interest rates are rubbish, so I’ll go into some much better investing strategies in my next article.

This brings me to the second lesson I learned which is: The Magic of Time and Compound Interest.

It’s probable that you haven’t really thought about compound interest since ceasing your formal education. So just as a reminder do the following brief calculation:

Take one pound (£1) and double it. Then do it again, and continue to do so. If it takes a year to double your money you would only have £32 at the end of five years. But keep going. At the end of ten years your £1 has become £1,024.  Keep going.  At the end of twenty years your £1 has now become £1,048,576.

Now it’s highly unlikely you will double your money every year in the real world. However we aren’t talking about a one-off investment of a pound. We are talking about prudently and successfully investing ten percent of your income month after month, year after year.  The compounding effect of even modest growth will be colossal given sufficient time.

In the next article I’ll give you some suggested strategies for investing and my full guide for becoming financially independent.

Part two coming soon…

We really ought to be talking about money, and we will.  However before we do there’s more to talk about regarding getting things done.  That means getting the right things done…on time.

If you want to be effective and productive you’ll have to get organised. 

It’s not difficult; primarily it only requires a notebook, a pen and a calendar, and a hefty dose of self discipline.

 It’s obvious that you have to write things down as you think of them and write your ‘things to do’ list every day. Keep your calendar up to date etc.  But it’s also important to work in a tidy environment.

My experience is that people who have a clutter all around them are almost always inefficient, ineffective and have little clarity of thought or action.

So tidy up and clean up.  Learn to throw stuff away.  Only file important things that you really will need again.  And file things out of sight. Not in stacks on your desk because they will simply be a distraction.

Here’s a suggestion that I learned from Stuart Goldsmith several years ago:

<span>Have a ‘Power Day’</span>

Make a list of all the things you’ve been meaning to get around to…..clear out the loft…clear out the garage….throw away old books and magazines…..clear out all the clothes you haven’t worn in the last twelve months…..put your holiday photos in an album…purge all the files in your office etc.etc.

Then pick the first available non-working day and set yourself the goal of working flat out for twelve hours with only brief five minute breaks every couple of hours for a tea or coffee and a sandwich. Get started promptly at 8.00am and work flat out until 8.00pm.  No leaning on your broom glowing with self congratulation after each task gets done.  Get on with the next one!

Work hard, work fast and get these jobs done. You may not complete everything but you’ll feel great!

This is something you should do at least four times a year. It’s a terrific habit to get into and you’ll find it really liberating.

Another vital habit to get into is to choose a time every week to take care of all the personal things you need to do in terms of checking bank and credit card statements, paying bills, responding to letters and so on.  Doing these things on a regular basis at a similar time every week will keep you totally on top of things and will save you an enormous amount of time and possible anguish.

Like you, I can easily be overtaken by inertia and it’s only by using these bursts of activity and regular routines that I can get things done.

If you seriously want to live up to your potential (who doesn’t?) and get the most out of life, then it’s vital to be a ‘Do it now’ person and stop putting things off.

Many years ago I read a book by Frank Bettger. He was a famous Baseball player in America whose career was cut short by injury. In his book which describes how he raised himself from failure to success he wrote a whole chapter on the importance of being organised. It had a profound effect on me which is why I refer to it here. It ended with a poem.

I’m not exactly sure how the poem began but this is pretty much how the last two verses went:

 If I could just get organized

The morning goes, the noon is here

Before I know the night is near,

All around me, I regret,

The things I haven’t finished yet,

If I could just get organized!

I often times have realised,

Not all that matters is the man,

The man must also have a plan

I nibble this, I nibble that,

But never finish what I am at,

I work as hard as anyone,

And yet, I get so little done,

I’d do so much you’d be surprised,

If I could just get organized!

Baidurya Mukherjee

In the next article we’ll talk about money.  It may not be the most important thing in life but for me it’s right up there with oxygen!

To be continued..