If you have a New Years Resolution to get in control of your money and start harnessing your wealth, it might be time to start using the GRS philosophy.
So, what does Get Rich Slow mean?
In this interview from WEtv, Sarah and Rebecca talk about the Get Rich Slow story, learning to give value to money, coffee, budgeting, identifying lifestyle goals in order to be motivated to save money, and how Get Rich Slow has changed Sarah’s life.
Rebecca Pritchard, WE Financial Coach: We need to start with how Wealth Enhancers came about and the ultimate Get Rich Slow story. Because I use GRS in a sentence all the time and some people may not know what that means.
In the early days of starting Wealth Enhancers it was all about people like us, Gen Y, and no one in the finance industry talking to us and helping us and I really wanted to change that. I wanted to be part of actually harnessing our generation and helping them build wealth. Then I was approached to write my book by a publisher, which was amazing, and when we were thinking of titles I was like,
I just I don’t want to be another get-rich-quick thing because it’s bullshit, there is no get rich quick,
and I hate anything I see that’s like, zero to five properties in five years or whatever.
RP: Make your first million before 30.
SR: Yeah, all this get rich stuff makes people feel like it’s going to be easy and it’s just going to happen. It sounds like you don’t have to do the work, where in the reality is it’s all about starting small, starting now, and chipping away slowly. So, I came up with that title Get Rich Slow, pitched it to my publisher and they liked it. Obviously it was controversial and some people said,
Oh, it’s not very appealing, everyone wants to get rich quick!
and I just say,
Well, that’s fine but that’s not authentic to me. It’s not real. I want to actually teach people.
RP: You can’t actually write that book.
SR: I can’t actually write that book because it doesn’t exist really. Of course you could win the Lotto, if you buy a lotto ticket or you could like have a windfall but the reality is it’s not going to happen for most of us, and we need to be chipping away and starting small and building up our wealth over that long term.
RP: For a lot of people, the reality of them having a windfall is actually when someone dies.
SR: And I think we’d all prefer to have our people living.
RP: Yes, have people still alive and us get rich of our own accord.
SR: No-one wants to like be relying on an inheritance for their wealth. If you have a potentially large inheritance coming then that’s really nice for you but still, you don’t know when someone’s going to pass away, let alone the fact that you don’t want them to, let alone the fact that nothing’s guaranteed in that regard anyway. You don’t know for sure what could end up happening between now and then. They could just decide to leave all their money to The Lost Dogs Home at the last minute. You never actually know and I feel like that mentality of waiting for something else is really not owning it yourself. It’s not owning your own situation.
RP: And so, what does GRS or Get Rich Slow actually mean? On a day-to-day basis?
SR: I think it means value for money, right? So where are you spending your money and what is the value you’re getting in return for it. It’s learning how to get rid of the mindless spending.
RP: The crap.
SR: The crap. Get rid of the crap that really doesn’t make any impact on you and doesn’t make your life better. One easy way to do it is for a week, every time you go to spend money just ask yourself,
Am I getting value for this?
And the answer will be ‘Yes’ or ‘No’ and if it’s a ‘No’ then it’s probably something that you should try to ditch. So that’s kind of the day-to-day.
But it also comes down to having goals and understanding what lifestyle you want to create. Forget all this stuff that’s like what you should do. You should buy a house, you should save ten per cent of your salary. You should, you should, you should.
It’s not motivating if it’s not what you want. Even the whole thing of saving for a rainy day, like that actually sounds boring. On a rainy day I basically sit at home watching Netflix, so what do I need to save for? Ten bucks for the subscription?
RP: Or, I’m saving my emergency money, but I don’t want an emergency to happen!
SR: Exactly. I mean, of course everyone should have an emergency fund and blah blah blah but those are not motivating goals when it comes to saving.
For me I love traveling. I just want to spend my life traveling the world. Buying a house and getting settled is not a motivating factor, whereas I know it is for you.
RP: Which is why we’re filming this in my house.
SR: Because luckily you have a house! I mean, everyone’s different, right? If I was saving up for a house because that’s what society tells me to do, I would be unhappy. That is incongruent with my values and my goals. So I think Get Rich Slow is all about spending the time to identify what are your values, what do you actually want to achieve in your life, what do you want your life to look like?
Funnily enough I think for most people it’s not very material. I mean there are some material things that give us comfort, like you know where you want to live. I’m definitely a big believer that my surroundings are important to me so even though I might not necessarily own, I do spend a lot of time making sure that the places that I live and the places that I work feel really nice to me energetically. So it’s identifying those kinds of things: What do you actually want your day-to-day life to look like? What are you trying to achieve?
Do you want to spend six months living in Europe learning a language? Or do you want to start a business one day and you want a buffer for it, or you want to be in a good position financially so that you feel like you can take that risk? Do you want your own home, do you want a holiday home? What is it that’s going to make you feel fulfilled? Break down society’s idea and get to your core idea, does that make sense?
RP: It does make sense. We talk about value a lot and, particularly when people are trying to save money, you hear the whole if you just don’t have a coffee today you’ll save a thousand dollars every year.
SR: I have coffee everyday!
RP: But you love your coffee!
SR: I do. It’s value. That’s the thing. I will go for a run or do my yoga or whatever, and then I go to the cafe and I’ll sit for like an hour and I’ll enjoy a coffee. Sometimes I journal, sometimes I think strategically about my business, sometimes I’m just doing a little bit of work, but that is my best time of my day and for me to pay five bucks for that hour of peace? It’s money very well spent. I know if you add it up over the year, that’s a lot of money, but I get value.
Whereas if I was grabbing that coffee and going or going to the cafe with my co-workers just because everyone else is doing it, that’s the mindless spending. One of the things I talked about in my book, I was so terrible, every time I filled up my car with gas, I would go to pay and I’d always grab a drink and a chocolate.
RP: Clearly before your health conscious days.
SR: Yeah, I know, I used to live on chocolate bars.
But yeah, not good for my health and not good for my bank account because I’d probably be adding like, I don’t know, six to ten bucks on top of my fuel bill every time I filled up the car. That’s the perfect example of wasted money and it seems like so little, but it’s the little stuff that adds up that makes the big difference over the years because it’s so much easier to waste money on something that’s small.
Like if it was a hundred dollars for me to buy a drink at the gas station I’d be like, ‘No!’, but $6, you think it’s nothing. You just keep swiping and then next thing you know that’s a lot of money every year in your budget.
RP: So that is Get Rich Slow. It’s saying, take your small wins.
SR: It’s value for money, looking at what you’re spending and sticking to a budget. I think a lot of people hate that word and they, I still do as well, you think of a budget and I think back to my days when I was like studying at TAFE and I worked three jobs and I rang my mum one day and I was like,
Mum, I just did my budget and I’m five dollars short every week.
And she was like,
Oh darling, I’ll put five dollars a week into your account.
And I was like,
No, I’m gonna figure this out. I’ll make it work.
But that’s how tight it was, right, it was really tough. There was no room for saving and it was all just getting by.
So that word budget often brings us back to those days, but it’s actually not. I mean any good company, any good individual who’s successful, who’s going to build wealth, will likely be running some form of budget. It’s really just around knowing what’s coming in and what’s going out and being mindful of that. I mean, if you don’t look at it and you don’t know what’s going on the chances of you actually being successful and harnessing that money to actually grow and get you your lifestyle is pretty low.
The first thing, culturally, we need to do is shift our mindset and see a budget as a tool. It’s a tool and it’s responsible and it’s being mindful and it’s ensuring you’re building wealth and using your money in a way that also values what you had to do to achieve that money. Essentially money is what we get in return for whatever we put out into the world. So, if you are disrespecting your money, you’re disrespecting yourself.
RP: And particularly because most people are trading time in order to earn that money.
SR: Yeah, that’s exactly what I’m referring to. Whatever job that we do every day, where we spend our time, we’re being paid in return for that. So, respecting yourself is actually what will enable you to start using that money properly and put the appropriate value on it and use it to create your future lifestyle and not waste it on the day to day.
RP: When you started applying the Get Rich Slow philosophy to your life, what was the first thing that changed?
SR: For me it was having the personal spending amount allocated. So, going back to that living week-to-week mentality but knowing that I was only using a portion of my pay-check. As long as I stuck within my $250 then I knew that the rest of my money was getting used to build wealth and that way I didn’t dip into my savings or kind of ruin that wealth creation stuff that was happening. I knew what I was saving for and investing for. I knew what I wanted to achieve in my life.
RP: In this instance you’re not just saving. You’re saving for this.
SR: Yeah, like I’ve got the savings account that’s for my annual travel, then I have the long-term, the investment account that’s for the time when I want to spend four years living on a boat, you know, those kinds of things. Because that’s pretty motivating to me, to imagine myself living and traveling the world on a boat or whatever, rather than just building wealth just for the sake of it.
RP: Because no one sticks to that.
SR: It’s too easy not to. If I was having an investment portfolio there just for the sake of being financially responsible, whenever something cool comes along…
RP: You’re always gonna take it.
SR: You’re just gonna take it. You’re going to take it. So I think that was the biggest shift for me. Because before that, like I’m a financial advisor, I had been investing, I had been saving, but I think that was the missing piece: what am I trying to create.
I would set goals in my life but I hadn’t made the connection between the financial side and the lifestyle I was trying to create. I would set goals over here and then try to be financially responsible over here, and it worked to some degree. But once I connected the two…
Money is a facilitator of life, that’s all it is. You don’t need to love it or hate it. You just need to use it for what you want your life to look like. And once I made that connection, it was amazing, because then I could just go on that path.
RP: It’s the bulk of the battle.
SR: Yes it is, it is the bulk of the battle.
For more of this episode of WEtv, head on over to our Youtube channel.
Disclaimer: all information contained within this article is of a general nature. It should not be relied upon when making financial decisions. Please consult a professional financial advisor or planner (like us!) before acting.