Today’s contributor, Lauren Lyons Cole, speaks on a subject near to my heart: achieving your dreams.
For a background on why Lauren is so amazing; she and I met during a conference call that I thought would be a very average discussion on what I “should” be doing financially. But in the first five minutes I blurted out, “I know I should say I want to save for real estate or something, but I really just want to quit my corporate job so I can write.”
And she said the most magical words of all, “I think you can.”
What I love about Lauren, beyond her incredibly fun, honest and upbeat disposition, is that she loves helping people achieve their dreams and has the financial know-how to get you there. I can attest to it, as the corporate job is no more, and I am in every way living my dream, beyond what was even imaginable.
Turns out, you don’t need to find pixie dust to make dreams a reality, just follow this really great advice. - Mary
5 Practical Tips for How To Follow Your Dreams
More often than not, we go through life on autopilot. Sure, there might be things we’d like to change, but who has the time to think it through? We tell ourselves we’ll do it next month or next year, and continue our current routine no matter how unsatisfied we are with it. But if you’ve got an idea brewing, it’s important to start moving forward—one step at a time.
Step 1: Visualize
To get the ball rolling on your dream planning, I recommend making a good old-fashioned vision board, using magazine cutouts, a glue stick and poster board (sorry, Pinterest just isn’t the same). They’re fun to make, and can even be done as an after-brunch girlfriend bonding activity. When you’re finished, put it somewhere you’ll see regularly. I even keep a photo of mine as the background on my phone.
Step 2: Create a Tangible Goal
Like it or not, money is a key component to following our dreams. Once you’ve identified what you want to pursue, it’s time to put a price tag on it. If you want to start your own business, I recommend having 12-months worth of living expenses saved up ahead of time. If you want to buy a home, do a bit of online browsing to find out what your dream home would cost. Save enough for a 20% down payment, and make sure you also have an emergency fund of at least $10,000-20,000 extra for any unforeseen costs (trust me, you’ll need it).
Step 3: Don’t Freak Out
Looking at specific numbers often results in feelings of discouragement. That’s normal. But time after time, successful entrepreneurs or world travelers or homeowners that I have worked with share one thing in common: the ability to save—and save drastically—when they needed to. Keep in mind, saving to reach a goal is not a lifelong commitment. Once you reach the goal, you can go back to spending however your heart desires. But if you’re focused on the big picture, eating a peanut butter sandwich for lunch becomes pretty manageable.
Step 4: Find an Inspiring Role Model
You may have seen Maria Murnane on Amazon.com as their featured female fiction writer, or maybe you’ve even read her hilarious books Perfect on Paper and It’s a Waverly Life. She and I recently swapped stories on our frugal ways, while sipping $6 glasses of wine and enjoying free appetizers at my favorite NYC restaurant, Guayoyo. Not gonna lie—the total combined cost of our outfits that night totaled less than $50. But if I do say so myself, we looked pretty damn good.
A former PR executive, Maria’s now living the dream as a successful novelist. And she didn’t do it with the help of a trust fund or a sugar daddy. She’s completely self-made.
“My parents taught me early on how important it is to save for a rainy day, so as soon as I started working, I saved as much as I could every single month. As my income rose I kept my spending levels about the same, choosing to save my money instead of spending it on superficial things like expensive clothes and weekly pedicures. When that ‘rainy day’ finally came around, I’d been saving nearly 60% of my take-home pay for several years, which allowed me to quit my job, move to Argentina for a year, and pursue my dream of becoming a novelist.”
Easier said than done, perhaps, but wise words from someone who’s happily abandoned the daily grind for a world of creative writing and mid-day yoga classes.
Step 5: Take Action
If you’re savings goals seem out of reach, find a way to persevere. You’ll need that skill when you start your own business or begin the search for your new home. To find extra cash on a monthly basis, try one or more of the below tips:
- Negotiate Your Salary. The easiest way to save more is to make more. As Maria said, keep your living expenses the same and put everything extra into your savings account.
- Cut Out Convenience Spending. Delivery food, housecleaners, manicures, waxing—these things add up. Stop paying someone to do what you can easily do yourself, even if it takes a bit more time.
- Reduce Recurring Expenses. Move somewhere cheaper, downgrade your car, get a cheaper cell phone plan or do away with cable. And if you don’t use your gym membership, cancel it. You can always run outside.
- Enlist Your Friends. Social time can be expensive, but it doesn’t have to be. Instead of going to a fancy restaurant, plan a picnic in the park. Replace group shopping outings with free activities, like going to the beach.
Ultimately, your future rests on the decisions you make today. Who knows, you just might end up as Amazon’s featured fiction writer a few years from now. Just don’t expect to get there without quite a bit of sacrifice—financial and otherwise.
Lauren Lyons Cole, CFP® helps people create wealth through earning more, spending smarter and saving for the important things in life. Her unique approach to financial planning is extremely effective and highly sought out. Lauren has been quoted as a personal finance expert in the New York Times, Wall Street Journal, Fox News, Marketplace Money, U.S. News & World Report, and the Huffington Post.