The United States is the richest country in the world. But did you know that 78% of Americans live paycheck to paycheck? Why is that? And what’s stopping you from achieving financial independence?

Well, the simple rule of personal finance is to earn more than what you spend and invest the surplus in good, income-generating assets. As long as you do this on a consistent basis, you will achieve financial independence sooner or later.

Financial-Independence

But what stops you – and so many people – from achieving financial freedom?  

Bad financial habits

There are bad financial habits or routines that are probably wearing you down. Do you, for example, have this habit of eating out or ordering takeaways every so often?

Do you have an addiction of some sort, such as a gambling addiction, for example? Do you go on a shopping binge every time you feel down or depressed about life?

Do you spend tens of thousands on buying things you don’t really need online? That has to stop. You know that already, don’t you? Here’s what you should do.

Track everything you spend, write it down and analyze if it adds value to your life or not. It the expense is an essential one, such as your internet bill, then don’t worry about it – consider that an essential business expense.

But if you find that you’re spending a couple of hundred dollars on cable TV every month, for example, cut that out and replace the cable connection with something cheaper, such as Amazon Prime.

Instead of having coffee at Starbucks every day, buy a coffee maker and make your own coffee. Control your temptation and exercise self-discipline in your life.

Bad advice/Getting overly influenced by the media

I know how it is like to receive bad financial advice. In my younger days I remember buying so-called “hot” stocks based on the advice of experts on CNBC (I won’t name them, but you know who they are!) I learned my lesson after losing over $25,000 of my hard earned income on such investments.

Understand – there is far too much bad advice coming from so-called experts on television, financial newspapers and the internet, and these days from the social media. The only way to make sure that you don’t get affected by that is to cut yourself off from all the noise.

The thing about the media is that they make you panic, and try to control your mind. They make you do things that you otherwise wouldn’t had you been thinking rationally. Don’t give the talking heads from the media so much power over yourself.

Stop watching TV all the time – even if you want to watch TV, watch a light entertainment program or football. Stay away from the news. Stay away from news websites, cancel your newspaper subscription and use the social media only to interact with friends and family.

Pick up a healthy habit instead, such as reading a good book everyday or working out at the gym. Learn a new skill, such as technical analysis. Do your research and think carefully before making an investment and be objective about it.

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