By: Ellie Burgueno
With the title above we’re not talking about how to hunt rodents or how to have fun watching a rat run in circle, but rather we’re talking about another game which is much more serious: the game of life. The phrase “The Rat Race” synthesizes a concept that author Robert Kiyosaki made famous in the book titled “Rich Father Poor Father.”
This book focuses on the hard-to-break financial aspect of the lives of some people and the situation where spending tends to grow at the same rate as earnings increase. The more you earn, the more you spend, and as you continue the cycle, many waste a lifetime playing and die stucked without being able to escape this endless race.
I believe that the influence of the society in which we live, the lessons learned both in classrooms and at home, have taught us to live this way: you grow, you study a career with job demand to qualify for a job with a sufficient salary to subsist, or at least to live comfortably, to pay a house for a term of 30 or 40 years, to retire and to die, repeating this life cycle of conformity over generations.
In our personal life as well as in our financial life, our desires and scenarios presented to us lead us to make decisions and choose certain directions in life; decisions such as: what will we study? who will we marry? , or how will we live? There are several beliefs originated in old phrases, very harmful to the personal finances of those who believe in them as people are placed in a position of observers, where wealth has a negative and limiting connotation.
The Rat Race, synthesizes the figure of a mouse running inside a wheel, without being able to escape. Applied to finance we talk about the situation where, for instance, someone borrows to buy a house, then a car, then to expand the house, then for travel and other things, in such a way that lives anchored to debts for over 30 years or for a lifetime, due to the lack of financial education and habits transmitted from generation to generation, preventing them from creating assets.
Financially successful people as John D. Rockefeller quoted, “The most important thing for a young man is to establish a credit, a reputation and a character.” However, sadly nowadays, in addition to seeing many people stucked in “The Rat Race” forever, there are large amounts of people, especially in Latin communities in the United States who, far from practicing this premise quoted by Rockefeller, are all sunk in debt and have a ruined and almost irreparable credit.
Acquiring unnecessary goods or things that are out of the budget, buying with credit, saturating credit cards and then stopping paying them, is something some people practice. In both, Mexico and The United States, this situation is even more harmful to people who are mostly living on public assistance, have very low incomes or who eventually want to buy a house, a car or get a business loan but are inevitably rejected because of their lousy credit history.
Getting out of a financial hole or The Rat Race is not simple but not impossible, everything starts with beliefs and actions combined. In our XXI century there are great opportunities for personal development and financial freedom if someone follows the steps that many, who have achieved success, have previously followed.
I believe that, for a person with credit problems, the first step will be taking action to repair it and start from there.
Having freedom or financial success does not mean becoming a billionaire, or having multiple assets. A lot of money can help us have financial freedom, however what we should question is: Do I really need to be a millionaire to achieve financial freedom?
It is not necessary to amass a large amount of wealth to be financially free, what is necessary is to get sufficient passive income to cover our daily cost of living.
Putting into practice what has been said by great thinkers about human beings, their unsatisfied nature, and their untapped capacity, we can say that success consists in the progressive realization of predetermined goals.
Being more aware of your finances and taking a plan of action that allows you to achieve those predetermined goals, gradually and step by step, using those hidden talents and drawing the reserved energies, will allow you to perceive life with a vision of hope that changes your destiny towards a better future, where it is also possible to enjoy financial freedom.