Financial Independence Formula


Financial Independence Formula

Financial Independence is simple.

It isn't easy, but it is really, really simple:

  1. Earn more
  2. Spend less
  3. Invest the rest

The idea for the conversation this week came up for me earlier this week when I saw this tweet from my friend, Chris Munn, and I wanted to talk through it with y'all:

There are three steps to Financial Independence and the first one is the most important, but it's not enough alone.

There's unlimited upside to how much you can increase your earnings,

But there's a floor on how low you can cut your spending.

The lower you go, the less fun you're going to have.

This isn't the lifestyle you're likely looking for if you're joining me as a Guider.

You're not looking to live the most frugal life possible; instead, you're looking to become the best version of yourself, which will allow you to increase your earnings.

While there are a lot of ways for you to increase your earnings, a hill I'm willing to die on is for the majority of people, it will come from getting a raise from your 9 to 5.

Something I've realized about leadership over the last 20+ years is a Good Leader doesn't become a leader because they want to or because they're good at their job.

A Good Leader is Chosen.

The people on their team lift them up.

The people on their team also vote for them to stay in their position.

The challenge is nobody teaches you how to become a person people want to lift up or keep in a position of leadership.

Over the next four weeks, I want to change that for you.

The Window and the Mirror

Over the last 25 years,

I’ve had the pleasure of leading hundreds of high-performing colleagues.

When it comes to hiring, training and retaining great teammates, these are the Top Four Things you need to know:

  1. Window and the Mirror
  2. Make the Investment
  3. Manage to the Test
  4. The Spotlight

The techniques I’m going to share have allowed me to climb the ladder to a CFO position at a large real estate development company.

They’ve also allowed us to build a high-performing finance team with 30+ professionals who have an average tenure of ~ 7 years.

These are some of the methods I’ve shared with the leaders of the team and am now sharing with you.

In Good to Great, Jim Collins writes about Exceptional leaders and a phenomenon he calls The Window and the Mirror.

From the moment I read it, it changed my life and how I lead.

Imagine a business leader looking at their team through a window.

When things are going well, they look through the window, point at their team, and credit them for success.

When things are going wrong, the window fogs up and becomes a mirror and the leader points at themselves to take the blame.

A Windows and Mirror Leader doesn’t:

  • Throw a colleague under the bus
  • Steal credit from their teammates

How to Implement:

  1. Recognize
  2. Take blame
  3. Praise in public
  4. Criticize in private

Recognition

Recognize People.

Don’t do it in a blanket way.

For praise and recognition to work, it needs to meet these criteria:

  1. Specific
  2. Timeliness
  3. Cater it to them
  4. Connect to the big picture

A simple way to do this is to email your boss(es), with your teammate cc’d, and highlight the good work your teammate did, letting them see you give them the credit.

Take Blame

Own it.

Pure and simple.

You own the results.

When they go wrong, you figure it out.

You explain to your boss what went wrong and shoulder the responsibility to fix it.

Share the message with your boss by email and then forward that email to your colleagues so they see you took the blame for them.

When someone knows you’ve accepted responsibility for a mistake they made, it builds trust and a willingness to go to the wall for you.

Praise in Public

Public praise is good for recognition and learning.

When you publicly share what was great and why, it has more meaning for the person being praised and helps the whole team learn to do the same.

Ensure to provide details about what the person did, the impact and the context so the whole team learns how you want them to behave.

Criticize in Private

Public criticism can trigger a defensive reaction and make it harder for a person to accept they’ve made a mistake.

It can also feel unnecessarily harsh to other people on the team.

When you're able to speak with a colleague in private, it comes across as kinder and better intentioned.

When you don't trigger their defense mechanism you're much more likely to get your message across.

TGG Podcast

This week on the Podcast, we talked to Nina Purewal, co-author of Let That Sh*t Go: Find Peace of Mind and Happiness in Your Everyday.

Let That Sh*t Go is a no-filter approach to mindfulness. It provides a practical toolkit on how to let sh*t go and find your bliss on the daily.

Nina provides lessons on how to find peace of mind and happiness in your everyday:

  • Forgive
  • Meditate
  • Celebrate
  • Fill Your Cup
  • Thought Auditing
  • Kardashian Effect
  • Embrace Authenticity
  • Control Your Reactions
  • Externalized Happiness

A Thought

These leadership lessons changed my life. More importantly, they changed the lives of those whom I have the pleasure of leading.

A Question

How can you implement the Window and the Mirror in your life?

Etc.

If you enjoy the Growth Guide,

You're going to love my friend, Eric Partaker's Newsletter, Peak Performance.

Eric offers personal growth and self-improvement insights to live better, become more productive and tackle personal challenges.


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