Have you ever felt that in your life you walk and walk, but you’re always in the same place? Do you live in a vicious cycle of working just to pay off debt and feel like you’re not really living ?
You are not alone in this, many people experience what we call the rat wheel . And to achieve financial success you need to get out of that place.
What is the mouse wheel?
You must be wondering what rodents have to do with your financial life, so let’s explain to you better what that means.
The term rat wheel was coined by investor Robert Kiyosaki, author of the best-selling book Rich Dad Poor Dad. This is one of the best known books on the financial market .
The expression wheel, or rat race, talks about an exhausting and tiring financial cycle that a person has throughout life . The term alludes to laboratory mice, those that keep running non-stop inside a wheel, you know?
It is an analogy to the vicious action of the worker who tries his hardest all his life but gets nowhere.
Kiyosaki brought this concept to the world of finance as most of us work a lot, and in the end see all the money going away to pay the bills. Everything we produce is quickly spent on more goods, which generate more bills, and the cycle continues into the next month.
The result of this is financial burnout, you work a lot, but your salary doesn’t increase in the same proportion .
How does the mouse wheel work in practice?
In practice, the rat wheel is a routine that is imposed, even indirectly.
When you realize you’re working 5 or 6 days a week and there’s no money left at the end of the month. You work, but not for you. Everything you produce is on your credit card bill and the more you earn, the more you spend. It’s an endless cycle.
In spite of working hard, one fails to accumulate riches.
How do you know if you’re living on the rat wheel?
After reading all this you should already know whether or not you are on the rat wheel. But to leave no doubt, let’s talk a little about it.
The most effective way to answer this question is to analyze the way you manage your money.
See if you spend more than you earn, if you think before you buy, if you are impulsive and make impulse purchases. How is your personal finance situation at the end of the month? Have you started investing in your future?
And remember something important: do not take into account one or another atypical month, in which you had an extra expense due to an unforeseen event. Consider the reality of a few months to be sure that the analyzed behavior is a pattern.
Is it possible to get off the rat wheel?
One of the consequences of being on the rat race is spending more and more.
Another thing, those who live in this cycle do not invest. Everything that is earned goes to pay off debts and there is nothing left to invest. Generally, this person does not have a financial plan and lives according to the moment.
The good news is that you have a way out of the rat race. Let’s see some tips to get you started today!
1. Invest in financial education
Speaking of investing, seek to learn about financial education . And don’t think it’s just about saving money . It goes far beyond that, it’s improving your relationship with money and making the best decisions in finance.
And nowadays you can get a lot of material on the subject, including free ones, like the one you are reading. But there are videos on YouTube, digital financial influences, books, in short, there will be no shortage of where to search!
2. Run out of debt
Go as far away from new debts as possible, they are precisely what put you in the rat race.
So avoid whenever you can. Of course, fixed bills such as water, electricity and condominium fees will remain. But here we are talking about the excessive and sometimes unnecessary expenses that we make.
The credit card is usually the biggest villain, you end up using it without thinking and when you see the snowball is formed. Therefore, organize yourself to pay the outstanding or overdue bills and make only necessary purchases!
3. Organize your finances
Make a financial organization , only with planning and organization will you be able to leave the mouse wheel behind.
Keep an expense and income spreadsheet to find out what your financial habits are, what successes and mistakes are. Start saving money , create an emergency reserve and have long, short and medium term goals.
The next step is in the tip below!
4. Start investing
We talked briefly at the beginning about putting money to work. Because that’s what happens when you invest. Once you manage to organize your budget, it will be easier to separate part of your money for this purpose.
This way, you will be able to achieve your goals and have more financial stability.
A great investment tip is private pension , with this modality you can invest a little per month and guarantee a better future for you and your family!
It’s a simple and affordable plan that can be done by anyone interested, without bureaucracy.
It works as follows: you hire a plan, send the money via automatic debit, it is invested in a pension fund and it starts to pay off.
