Money is a source of stress for a lot of people. Most of us want more of it, no matter what position in life we are in now. Many of us wished we could afford to have better and nicer things and do more cool stuff. A growing number suffer because they don’t have enough for even basic needs. Some seem to make a lot of money but never have much money. Others can’t seem to figure out how to make it, no matter how hard they try. Some want to avoid the subject of money completely or think money is evil because they have seen a number of rich people do evil things. Such people tend to get featured in the news a lot more than very poor people. Some of us can’t make it without help from family or the government.

I am not a financial advisor; I am a writer. I wrote this to help you. I have been through most of the above conditions in my life, and I learned a few tricks on the way. I wanted to share some simple tips with you. Some of the most powerful facts in life are the most simple. I sincerely hope you use it.

0. Purpose

One thing that makes all of these steps easier is having and following a purpose. Setting targets to get things done is good, but setting a target so you can get something you really want badly is the best. Doing a job that fits along with your purpose makes the road a lot more fun.

1. Spend Less Than You Make.

Easier said than done.

This can be very hard if you a) don’t make enough income to support yourself and/or your family and b) if you want a higher standard of living than your income allows.

If either a) or b) is a problem for you, this part will require some life changes. Hopefully, they are not too difficult for you, but for some, this will be extremely difficult. It might even seem impossible. The good news is that if you can read this, it’s not impossible.

1a. Change Your Mind

This applies to both categories above, but especially if you are in a) above, you may feel certain that you cannot do anything about it. This triggers you in some way. The good news is that it means this is a major situation preventing your success in life, and by resolving this, you can be successful. You will need to change your mind about your condition before any of this article or any advice at all can help you.

If this seems impossible or upsetting to you, this might come from bad information you have received in the past. You have been given a lot of bad information about money since you were a child. Most of it from others who were given it by others and believed it was true themselves. A little bit of it was probably given to you on purpose by people with bad intentions who did want to harm you or take advantage of you. This could be data like “You have to be rich to amount to anything,” or “It’s ok to cheat as long as you don’t get caught,” or even “You don’t have to pay it back if you can’t afford it.” In our lives, we have all embraced some data that has suited us to excuse our failures.

The worst of all would be, “You can’t make it because of your skin color/gender/religion/status/disability/language/age, etc.” The reason it is the worst is that it’s probably based partly on truth. You might be disabled. You or your family might have suffered badly and might be suffering badly right now because of this reason. You might factually have a more difficult path than others in a different situation. It might enrage you to think about this.

If this is the case, bluntly, you have two choices. The first is that you can decide to use this past or current suffering/oppression/condition as a good reason to fail or be unsuccessful. This is the more mentally comfortable of the two choices. If you do this, you will stay the same or get worse. Somehow the universe was designed that way. The harder and right choice is to decide to use this reason as a reason to fight harder and to succeed. If you use things done against you as a reason to fail, those that did this to you win. Only if you use it to fire yourself up to be more successful and change your life, do you win and they lose. You either take responsibility for your life, or you blame others and give them control of your life. You can’t change what was done to you or your condition in the past, you can change your future.

Hungry immigrants have become billionaires, homeless have become millionaires and members of marginalized minorities have changed their lives and become very successful. I am friends with a paraplegic and a blind man, each of whom has made six figures while disabled.

If you can read this, you can change your life completely. But no one else can make up your mind for you or help you if you don’t decide to as the first step.

1b. Keep Good Records of Your Expenses.

The next step is to track your expenses. This also applies to both but especially b) above. You can’t tell if you’re spending too much unless you measure it. Put some discipline in on yourself and make yourself do this.

It can be done in a number of ways. What is important is that you do it in a simple way that works for you. It can be the old-fashioned way by keeping receipts and/or making notes in a book or nowadays on a computer or iPad. There are apps that let you scan receipts. Another way is to make all your expenses come from one account and read the bank statement at the end of the month. Many bookkeepers suggest using QuickBooks; I just use Microsoft Excel. If you don’t have a computer you can get a cheap used laptop for $75 on eBay.

Cut down on spending if you spend more than you make.

2. Make More Income

How to do this is a long subject. In short, the right way to do it is to create value and get great money in return. You can be in a situation where you get paid and don’t create much value, or where you create a lot of value and don’t get paid for it. Neither situation is good. Figure out how to create more value and collect more in return.

If you don’t have a job, get one. You might temporarily need welfare or unemployment to pay the bills and survive. By all means, accept the help if you legally qualify, but you need to work harder to get out of that situation rapidly. Don’t let it become permanent, or it will become a glass ceiling.

If you are not well-paid, work out how to create more value, and sell your employer on giving you a raise, or get a better paying job. This might require taking classes or learning a new skill to either get a promotion and a raise or an entirely different job. This is not as hard as it used to be. There are now many high-paying jobs that don’t require a college degree. We have YouTube, Google, and many other free or cheap learning resources out there. You can learn a new skill.

One way is to get a side hustle that works for you. Make sure it really works for you, some side hustles don’t pay much. It’s okay to grind to improve your situation, but don’t overdo it to the point where you don’t get enough sleep. If you don’t have time, take a close look at your time to make certain this is true. Do you watch Netflix, play video games or hang out and drink with friends? If you are making less than you spend, it’s a good idea in the long run to temporarily cut down on those activities until you can change the situation.

If you have a decent job, but really want to increase your standard of living, or need or want to support more people, you may want to consider starting your own business. This is usually a lot harder than working for someone else, but it has more rewards including being in control of your own time and money. For great tips on this, as well as money and finance in general, I follow Fiona | the Millennial Money Woman.

3. Trick Yourself into Paying Off Your Debt Faster

If you have overdue loans or a lot of credit card or other debt, trick yourself into paying it down faster. You do this by increasing your monthly budget to include 10% or more to pay the back debt. This might include increasing your income to cover this budget. Points 1a & 1b above apply to you if you have overdo loans or a lot of debt.

4. Trick Yourself into Saving Money

Once you have paid off your debt, the next step is to save. It is generally recommended that you have a 3–6 months rent and living expenses in an emergency fund.

Do not just try to “save” money. This often fails because we usually spend all the money we think we “have” for things we want. Trick yourself into “spending” 10% or more of your income into savings.

5. Invest

In current times, the interest rate in a savings account in much less than inflation. Inflation is where things costs more over time so the value of the same amount of money is actually less. In other words, by leaving your money in a bank account, you are losing money every year. When inflation happens faster than your paycheck, then you can buy less things.

Click here for a full explainer on inflation.

Therefore, once you have paid off your debt and saved a 3–6 month emergency fund, it is smart to invest the remainder in assets that increase in value over time, faster than inflation.

If you don’t know much about investing and don’t have the time or interest in learning, one strategy is to invest in assets that increase in value more than inflation over time. The S&P 500 (a basket of around 500 stocks of large companies on the US Stock market) has increased by an average of 10–11% per year since 1926. Real Estate and Bitcoin are also assets that have increased in value faster than inflation over time.

Click here for a full explainer on a lazy and easy investing strategy.

To invest in the S&P 500, the Stash app is a great way to start learning and investing.

Click here for a full explainer on Bitcoin and here for buying Bitcoin safely and easily.

For helpful insights on finance and investments, I follow Anthony Pompliano, AKA Pomp, and you should too. Here is a great thread:

The 5 rules of personal finance:

1. Spend less than you make
2. Get out of debt
3. Build multiple streams of income
4. Invest your money safely
5. Be patient & disciplined

Easy to understand. Hard to execute.

— Pomp 🌪 (@APompliano) November 14, 2020

6. Learn about Taxes

This is an important subject to at least learn a little about. Whether you use an accountant like me or not, this could make a big difference in terms of saving or paying a lot of money. All you have to do to have more control is to understand some of the basic rules. There are a lot of resources you can research online. Here is a good one I found.

7. Don’t Break the Law or be Dishonest

There is no more sure way to mess up your life and stop yourself from making money. Even if you don’t get caught, you will never prosper if you are breaking the law. If you realize that you are being dishonest or committing illegal acts (even if you feel there was a good reason to have done so in the past) do something to correct your behavior right now. If you cannot get help from someone you trust.

Good luck!

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This article is not investment advice, nor does it take your personal financial situation into account. Never invest more than you are willing to lose, and don’t buy Bitcoin or other investments on credit. I write about my observations and personal opinions with the purpose to share what I have learned with others.

Disclosure: I am invested in Bitcoin and other cryptocurrencies.