Financial Plan For 2010

As the new year approaches, I'm finalizing my financial plan for 2010. I wrote back in November that I was considering selling some stock to pay off credit card debt. I've changed my mind after reading in one of the "Rich Dad" series of books, by Robert Kyosaki, that the rich do not dip into savings to pay off debt or meet cash shortfalls. That defeats the whole purpose of "paying yourself first". So instead I've decided to use a percentage of the dividend income from the stocks to pay off the debt and reinvest the rest to continue building my portfolio, while reducing debt. I should be completely debt free by the end of next year, which will allow me to increase my monthly investments by 300%.

The real point here is that I'm trying to get away from the poor persons mentality of always paying everyone else before paying myself. By continuing to pay myself, even when my cash flow is tight, it makes me look for ways to increase my means. In other words, I'm a lot more motivated to look for ways to increase my income, to cover my expenses.

I used to invest any money I managed to save after paying everything else. Now I consider my monthly investments a part of my expenses. The way I see it, if I'm willing to work so hard to come up with the money to make car payments for 3 or 4 years to buy a depreciating asset, shouldn't I be even more enthusiastic about working for a better future for myself and my loved ones? I've really shifted my thinking regarding saving and investing. It's no longer money I manage not to spend, it's money I've budgeted, the same way I budget to pay for a car or anything else. Only I'm paying for a better life!

So I'm finalizing my wealth building plan for 2010 and looking forward to another great year of adding income producing assets to my investment portfolio. I'm setting some ambitious goals and working on a plan to get there.