If you stand on the streets of Nairobi and ask every passerby what their biggest wish is, 8 out of 10 people will probably tell you they want to be rich. But if you ask how they plan to do that, half of that number will likely have no proper plan of action.
To be fair, ‘being rich’ is relative. To one person, the ability to comfortably afford three meals a day is the ultimate definition of being rich. To another person, it is more about their net worth. How many assets have they accumulated? What is the balance on their bank account? How many vacations can they afford in a year?
Whatever your definition, you are probably reading this article because you want to achieve more financially than you have ever achieved.
Well, I can already summarize this whole article for you in one sentence.
“If you want to achieve what you have never achieved before, you need to do what you have never done before. Step out of your comfort zone”
But you have probably already heard that a million times already. And what you are looking for is not some philosophical jargon but practical and actionable tips that will help you reach your goal sooner.
Hence, this article gives you six practical sacrifices that can help you escape poverty and put you on the way to building great wealth.
In her book, Mindset: The New Psychology of Success, Carol Dweck found that ability wasn’t the key to success. Instead, the key is in the belief that ability can be developed – an ‘everything is possible’ mindset.
So that is the first step. You need to change both internally and externally. You will need to change your perspective and how you view the world. In this world, the rich and poor think differently.
For example, growing up, one of my dad's favorite statements was, ‘the rich are never happy! They have so much money, but they are not happy. I am happier than the rich because I am poor.’
You can already tell that this statement became a self-fulfilling prophecy even without me telling you. My father never succeeded beyond hand to mouth. We were always out of school, and we barely had more than one meal a day.
According to psychology, money mindset accounts for 80% of financial success, while skill and hard work only contribute 20%.
So, the first step to escape poverty is to aim for change. Poverty comes with a lot of mental baggage. Start by changing your mindset. You can’t become a successful person while still identifying yourself as poor. Eliminate all those labels associated with poverty from your life.
Second, change your environment. For instance, if your dream business has no hope of flourishing in your home village, do all it takes to move to a place where it will grow. Also, if need be, change people in your inner circle. Surrounding yourself with progressive people who will push you towards your goal.
These changes will not be easy. They will make you uncomfortable. But it is a sacrifice that will be worth it eventually.
‘Time is money!’ This phrase is more than just a snappy aphorism; it’s the truth.
Have you ever wondered why some people make a lot more from their day than others? It all boils down to how well you manage your time.
Time and money are interconnected. One thing all millionaires have in common is time mastery. The most successful people have mastered the ability to amp up their productivity and squeeze the most out of the 24 hours.
So, to get to the next step in your life, you need to think about how you can maximize your time to help produce more.
For example, if you have an 8-5, what are you doing with the rest of the hours in your day? Do you throw on your PJs and snack while binging Netflix? Or do you purpose to put 2-3 hours learning a skill or maybe creating a passive income-generating venture that you will launch in a month?
The little you choose today will help propel you out of poverty into the future you envision. It is not easy, but it will be worth the sacrifice.
Learn more: Understanding Active and Passive Investment
I am all for working hard. In fact, I am a die-hard fan of the 5 AM Club by Robin Sharma. In the book, the author teaches how embracing an early morning routine can help you have a more productive day. However, waking up early and working hard alone will not take you far. But working smart will.
For example, what difference will it make for you to wake up at 5 am, only for you to be the first to arrive in the office? Well, that will help you start your daily work routine earlier and maybe earn you praise from your boss, but then what? Will you get a monthly bonus from your employer for arriving early? Probably not.
So to escape poverty, you need to be willing to not only work hard but also work smart. After all, everyone has 24 hours in a day. The only difference is how efficiently you use those hours.
In order to achieve financial success faster, you need to work 100 times harder and 200 times smarter.
This is a no-brainer. Unless you win a lottery or inherit a fortune, building wealth is a game that needs a well-thought-out strategy. No matter how much money you earn, it will be hard to get out of poverty if you do not carefully plan your finances.
Therefore, another thing you will need to sacrifice in the short term is self-gratification. You will need to forgo a few things in order to save more. Maybe you will need to give up a few ‘sherehe’ nights. Or cancel all trips to the mall with the kids. Or perhaps you might need to substitute your English breakfast with ‘nduma’ for a few mornings a week. Do whatever it takes to save more.
Remember that saving only is not enough. You need to learn to invest like a pro. To do this, learn as much as you can. Thankfully, there is limitless knowledge and resources available today; you will be able to master money matters easily and quickly with a little determination.
You can learn how to cut costs, budget, and even how to successfully invest with just a few clicks.
It is human nature to want to be liked. We are always wondering, ‘what will people think?’ If I do this, what will people think? If I sell my car, what will people think?
However, maybe if you sold the car, you would invest the money in a business that, would be successful enough to afford you an even better car a few years from now. But you hesitate because deep down, you worry that maybe people will gossip.
Put a stop to this and start focusing more on the outcome of your decisions. Do not put emotions into anything that will affect your financial future.
If your full-time job does not align with your financial journey, seek change. If you need to change your friends in order to grow financially, go right ahead.
One of my friends went through four tortuous college years to become an actuary. After college, and just like many other college graduates in Kenya today, she was welcomed into the phase where you send tonnes of resumes and receive tonnes of regrets back.
After some time, she decided that enough was enough. She was going to take matters into her own hands. Today, she owns one of the biggest furniture shops in Nairobi.
So do not let a school certificate confine you. Think beyond the certificate. Like that friend of mine likes to say, there is money if you know where to look. Go out there and get your hands dirty.
If you don’t know where to start, check out our previous article, where we discussed some very odd and unexpected but profitable businesses you can start on a small budget. These will help you get started on your financial journey.
No matter what they say, no one wants to be poor. However, not many are willing to put in the work to get out of it. Because the journey out of poverty is treacherous, it is uncomfortable.
But if you succeed, you will be grateful that you made sacrifices and put in the work to get to your destination. So, congratulations on choosing to change your situation. Now, it is time to put in the work and make tough sacrifices in order to escape poverty.