On my journey to self improvement, I have asked myself a LOT of questions. Many of which I didn’t like the answers to. But in answering them, I found out that my life can be, and has been, drastically improved.
The most important questions I asked myself are below, along with my answers at the time (earlier this year). I have also added side notes to some answers in red, with feelings I had towards my answers and some great lessons to learn.
Try and answer these questions yourself, honestly, and write your answers down. You’ll be surprised how easily things can be improved..
Q – Is there anyone in your life you no longer speak to who has tried to reach out to you?
A – I don’t speak to my parents or my younger brother. After a family fall out around ten years ago, the family separated. I no longer have any ill feelings towards them, I just have no desire to speak to them. In all honesty, we have nothing in common other than blood. Although I do not hate them, I realise that we are very different people, both morally and philosophically.
I often think about getting back in touch with my family, my brother more so, however I always conclude that I am happier without them. I don’t have fond memories of my teenage years when I lived with them, in fact I have pretty terrible memories of that time. The last time I tried to make things right things didn’t go so well. The obvious differences in personalities moved us further apart. My brother is who I would like to speak to, but he harvests feelings toward me which my parents have instilled in him, and this shows in some of the things he says to me, it’s almost like he holds a grudge because I left. I don’t know…maybe i’ll reach out to him when he is a bit older..
Q – How much money have you saved in the last 5 years?
A – More than I have saved right now. At the moment I have £400 in my savings account. I have had up to £1,800 at certain points over the last 5 years, but I have spent all of that money on holidays, despite trying to save a deposit to buy a house.
Considering I have worked full time on a good salary for 8 years, £400 is incredibly disappointing.
Q – What percentage of your income do you spend on car payments, petrol and insurance each month?
A – Car Payment + Insurance + Petrol = 22.26% of my monthly income
Q – What percentage of your income do you spend on housing/living costs each month?
A – Rent + Council Tax + Bills + Food = 50.81% of my monthly income
Q – What percentage of your income do you spend on eating or drinking in bars and restaurants each month?
A – Restaurants + Costa Coffees + Nights out with friends = 21% of my monthly income
Q – What percentage of your income do you give away to help others each month?
A – 0% – Okay this is starting to make me feel bad…
Q – What percentage of your income do you save for investments/retirement?
A – 0% – Now I feel worse..
Q – What percentage of your income do you spend on repaying debts?
A – Debt repayments amount to 6.03% of my total monthly income
This was the most surprising answer for me. Until recently, I thought paying back debt was what I spent most of my money on. In actual fact I am spending 3.5 times more on both socialising and transport!! THIS CAN’T CONTINUE!!! If I flip those percentages round I can have my debts paid off in a third of the time, and pay a hell of a lot less interest!!
Q – What is the total amount of debt you owe? And at the current repayment rate, how long is it going to take until this is paid off? Be completely honest and account for every single penny!
A – Student Loan + Car Finance + Student Overdraft + Personal Loans = – £26,780. My personal debt such as loans and car repayments will be fully paid in 3 years time (according to my agreed repayment plans), however my student loan payments will take 30 years to repay at the current rate!!
WOW – 30 years is astonishing. I have done a further calculation on this student loan debt, and by the time this is paid off, I will have paid £6000 extra in interest.
Biggest wake up call – Most people think this is fine because this gets deducted out of your pay slip before you get taxed!! ‘Oh I don’t even notice this payment’ is the common opinion on student loans…
This is unacceptable and a massive con, to say the least!! I have worked out that if I pay an extra £150 per month off my student loan debt, then I will have this debt paid off in 5 years and pay less than £1000 in total interest.
Q – What is the total value of the assets you currently own?
A – ETF Fund + Stock Portfolio = £160
This is why saving a deposit to buy a property is so important to me. Assets are the only way to increase your net worth significantly and ensure more security in retirement (unless I win the lottery of course).
Q – Do you have a spreadsheet which allows you to track every penny you earn and spend each month?
A – Yes – I started doing this a few months back and was once again shocked about how much I spend without considering my debt obligations and long terms goals. My spreadsheet contains exactly how much money I earn and subtracts every penny that goes out from that amount.
It’s this spreadsheet which has allowed me to save the £400 that I currently have in my savings account. When considering if I can afford something, I put the cost into my spreadsheet and then adjust my current spending to allow me to do it, this way I am learning to sacrifice things I don’t really need and my spending decreases each month.
If you don’t have a spreadsheet like this, please comment below with your email address and I will send you a free copy of mine – I promise this will work wonders for your finances!!
Q – Do you have a list of goals you want to achieve, written down? Financial and otherwise?
A – Yes. Mostly financial goals. I have given myself 18 months to get out of debt and save enough money for a deposit to buy a property. These two priorities are at the top of my list and I have made a plan of how much I need to save each month to achieve these goals. Added to my financial spreadsheet of course.
I have had to cut spending in many areas of my life. The first to be cut was the amount of money I spend socialising each month. I now have the same amount of nights out each month, I just don’t drink alcohol on half of those nights. I’ve also chose to cook more meals from home rather than go out to restaurants.
The best decision I’ve made is to move out of my current apartment and move in with a friend. This decision has saved me an enormous amount of money. My new living expenses now amount to 26.76% of my monthly income as apposed to 50.81%. I plan to save and pay down debts with the spare cash.
Q – Are you the highest paid employee at your company? If not, why not?
A – No. Other than the director of the company, there is one other person who earns more money than me, and we work on the same projects. The reason he earns more money is because he has more knowledge in more skilled areas of our operations.
I could be the highest earner within my company. I just need to learn more. I can shadow the guy who earns more than me whenever I want. I can ask him for information about any job he carries out. The knowledge is there and available to me, I just need to reach out for it.
Q – How many books have you read in the last 6 months? And are they the right books?
A – I have read one book in the last 6 months. The book was ’12 Rules For Life’ by Jordan Peterson. This was a great book which centred largely around taking responsibility for your own life and I found the book to be extremely beneficial. The concepts discussed in the book are similar to ‘How To Win Friends And Influence People’ by Dale Carnegie, and after reading the book I made plenty of positive changes.
One book every 6 months is not enough reading. I read that the average millionaire reads over 30 books a year in the UK. I have always had a passion for learning and you must read a lot to be able to learn. I have never really been interested in fiction, as I don’t tend to learn much from that genre. Personal development and educational books are where I find the most value and they genuinely allow me improve my life each time.
I have also recently signed up to Audible, which allows me to listen to audio books on the move, in the gym and in the car on the way to work. The knowledge you can gain listening to audio books whilst also being productive in other areas is priceless. If you haven’t already, give Audible a try!
Q – How many pounds overweight are you?
A – Zero. This is the most successful part of my life. I workout 3-4 days per week and eat healthily. When I miss workouts or don’t train for a while, I feel lousy and unproductive. Working out puts me in the right frame of mind and genuinely provides me with more energy for the rest of my day.
If you don’t currently work out and feel like you lack energy, try and do 20/50/100 press-ups, or go for a run, a couple of times a week, and see the difference that makes to your physical and mental well being.
Answering these questions put a lot of things in perspective for me.
A couple of things I asked myself, concerning family relationships and health, were asked to highlight the areas in my life I felt were the most important to address. Maybe answering these types of questions will help with any issues you have with your family or health and inspire you to improve. At the very least, this exercise will give you an honest reflection of where you are, compared to where you think you ought to be at this stage of your life.
The main thing for me was realising that I am more in control of my finances than I thought. Most people believe that our financial struggles are down to not being able to earn enough money, which often leads us to blaming this on our boss not giving us a pay rise, or not being allowed to work enough hours etc., however the power you have in limiting your spending holds much more significance.
I asked myself one final question to confirm this hypothesis..
Who would you rather be? The guy earning £100K a year and spending £100K or the guy making £30K a year and spending £15K?
We all know the answer to this question, and thinking about this answer has inspired me to improve my life in many ways.
Organising and tracking my spending each month has helped me begin to save the money I need to get out of the hole I found myself in and it wasn’t until I began this exercise that I realised how deep that hole actually was.
Thankfully I am now on track to dig myself out, and I am actually excited about it!
Maybe you are already financially secure for life, but if you’ve made it this far and you’re reading this then maybe not. If not, then give the questions above a go. I hope doing so can help anyone facing the same issues to make some positive, lasting changes!
Thanks for reading.