Many entrepreneurs struggle with the need to be frugal and the desire to live in abundance. Common sense says the two aren’t compatible. If you’re eating cheap meals and not spending money, you’re not living in abundance. Likewise, if you’re surrounding yourself with abundance, you’re not living frugally. Entrepreneurs want the best of both worlds and are struggling to figure out how to make it work.
When you’re bootstrapping a business, it’s hard to justify renting a house by the beach for $4,000 per month, yet that’s what many entrepreneurs are being told to do. Live in abundance and you’ll attract more abundance, popular sources advise. Throw your hat over the fence. When you start spending money, you’ll feel abundant, and money will flow back to you.
For some entrepreneurs, this advice seems to work like a charm. For others, it leaves them in a perpetual state of struggle. They’ve gone into debt to maintain their abundant lifestyle, but they’re sure the payload is right around the corner. Meanwhile, they feel like a failure for relying on their 9-5 job to pay the bills.
Change your mindset to be a successful entrepreneur
For many entrepreneurs, the struggle to be frugal and feel abundant at the same time is real. However, it doesn’t have to be. You can have your cake and eat it, too if you change the way you think.
Change the way you define abundance
The Merriam-Webster dictionary defines abundance as “an ample quantity” and a “relative degree of plentifulness.” Regardless of what you picture in your mind when you think of abundance, go back to this basic definition.
Just for a moment, stop thinking of abundance in terms of things like money, a flow of clients, and a big, beautiful home. Ask yourself why you want an abundance of money, clients, and a big, beautiful home. For most people, the reason they want those things is that they believe they’ll feel better when they have them.
Material success can’t make anyone happy, but it sure does feel good not to struggle. Essentially, what most people want is the absence of struggle. Money is perceived to be the method of attaining ease in life, and a beautiful home represents the achievement of that ease.
You might have a different way of wording what you’re really after. What is it that you believe money and other material successes will provide you with? Peace? Joy? Happiness? Freedom? Whatever your underlying goals are, think about abundance in terms of those goals. For example, if you want to live a joyful life, define abundance as an “ample quantity of joy.” Or, if you want to feel freedom, define abundance as “a plentifulness of freedom.”
Redefining abundance according to your deeper desires changes the way you pursue your goals. Instead of chasing the objects you believe will bring you joy or freedom at the cost of going into debt, you’ll be open to all possible ways of accessing joy or freedom.
For example, say you want a big house in one of the most expensive cities in the U.S. because to you, having such a house represents financial success. The house isn’t your primary objective. What you really want is to feel successful. What if you could feel financially successful without a big house?
What if you could feel successful by setting and achieving specific financial goals? Maintaining a big fancy house will deplete your bank account while achieving specific financial goals will make your bank account grow. Doesn’t that version of success sound better in the long run?
Pursue your passion, but not at the expense of your wellbeing
You can be successful by following your passion, but be careful not to abandon a stable source of income too early. For example, Australian entrepreneur Alborz Fallah followed his passion by starting a simple blog called “Car Advice.” He purchased the domain name for $35 in 2006, and in 2016 he sold it to Channel Nine News for a cool $35 million. Fallah’s advice to other entrepreneurs? “You’ve just got to keep trying and the one that will work will be the one you’re most passionate about.”
Passion is a key ingredient in entrepreneurial success. Those who make it strike a balance between pursuing their passion and doing what’s necessary to pay the bills. They balance their desire for material abundance with practicality, often buying used cars even when they’re generating millions of dollars each month.
Invest money now & buy toys later
Delayed gratification is the foundation for success in the world of finances. Consider that every dollar you spend today is one less dollar you have to invest. If you frivolously spend ten thousand dollars every two months, you’re losing the opportunity to invest that money and earn a minimum of $1,860 per year or $9,300 in five years.
For example, say you put $10,000 into a CD that will yield a 3.10% return. You’ll earn $310 per year and $1,550 for five years. If you get a $10,000 CD at that rate every two months for a year, when those CDs mature at the end of five years, you will have earned an effortless $9,300.
If your business is bringing in significant income, it doesn’t make sense to spend your money on toys. You might feel abundant for a while, but when it comes time to pay the bills, a depleted bank account will steal that feeling right out from underneath you.
Downsize as a choice & not a sacrifice
More people are choosing to downsize the homes they live in to simplify their life. According to testimonials coming from tiny home dwellers all over the world, a simple life really does increase contentment and decreases stress and worry.
The tiny home movement may not be your cup of tea, but you can still set your sights on downsizing. There’s no reason to spend half to two-thirds of your income on rent and utilities, nor is there a good reason to take out an expensive mortgage just to live in a fancy house.
Think of downsizing your life not as a sacrifice, but as a way of relieving the stress that comes with having to maintain a complex, expensive lifestyle. This is where your passion becomes important. When you’re not free to pursue your passion, and you’re stuck maintaining an expensive lifestyle, it’s hard to enjoy life.
The important question to ask yourself is what brings you closer to joy? Maintaining a lifestyle, or rearranging your life in a way that supports pursuing your passion? If you’re struggling to decide, try simplifying your life for six months and experience the benefits firsthand. When you do, you might just end up with an unexpected successful business based on your passion.