How behavioural finance can help your bottom line is the key to becoming financially independent. Don Eschbach is a lifelong student of Behavioural Economics and enthusiastic about promoting taking control of your spending habits. Don quotes a Kaplan study that showed that 87% of a persons net worth is determined by their behaviour.
Only 13% of our wealth is the result of the markets and market timing. Most investors focus on this 13% and not on what they have spent their money on. If you want to know how to retire early, what you need to know could be in focusing on your savings plans.
Don Eschbach is a Chartered Retirement Plan Specialist, a Behavioural Financial Advisor, an Accredited Investment Fiduciary, an Accredited Portfolio Management Advisor and is know on Linkedin as a financial Advisor. Don also is a Real Estate Investor, Property Manager, Ironman and a family man who loves helping his clients save for their future.
The message from Don is:
‘don’t spend your money now as its worth more later.’
With an emphasis on the Behavioural Finance side of Behavioural Economics Don has made it his mission to educate you about your spending habits and how this effects your savings.
The FIRE movement (Financially Independent Retire Early) has brought the spotlight onto retirement at any age.
People that fall into this movement put a greater emphasis on their spending habits. They eliminate luxuries from their lives and focus on essentials to stop frivolous shopping so early retirement can be achieved.
That is the challenge to everyone, to take a step back before spending those dollars and consider if there is a cheaper way to have the same enjoyment. Ask yourself if this item wll make a difference to your life in 5 years time? If the answer is no then perhaps you don’t need it.
Could you enjoy a home brewed coffee instead of takeaway from a coffee shop? Can you get to the supermarket in a slightly older, affordable car instead of a new, luxury one? I stopped buying the newspaper and magazines years ago and my 10 year old Toyota Rav4 gets me around to anywhere I need to go.
If you want to know how to retire early then Don says you just need a nudge along to get you into better savings patterns to invest for your future. Your behavior really impacts your future.
Sometimes you need a nudge along to get you into better saving patterns so you can end up in a better financial position. Listen to this podcast and learn how behavioural finance can help your bottom line.