There are four pieces to the financial puzzle, and if you only look at one or two, to the exclusion of the rest, you will find yourself struggling financially in one or more ways.

The Four Areas of Financial Balance:
1. Earning
2. Giving/Tithing
3. Saving (or Investing, which should be saving, with growth -- not gambling, as noted below)
4. Spending

There are various approaches and opinions as to which order these should go in. However, many people in today's world (at least in America) put the last one first, which obviously causes serious problems!

In any case, our focus is usually on one or two of these, leaving the other pieces lacking, or at least not considering how they all fit together and affect one another. For example, many people place most of their focus on debt -- being in it, getting out of debt asap, avoiding debt, etc. Aside from the new and interesting research demonstrating that it is very likely that you attract more of what you focus the most on into your life, what is wrong with this approach?

The problem with only focusing on getting out of debt asap, is what about the rest of the picture? Where is your financial balance? What about wealth creation? Savings? Retirement? How does the money you owe affect your other financial goals? And, perhaps most importantly, is there life after debt? 

A little financial humor there, but the point is that many people are so focused on "getting out of debt," they forget to think about what happens when it is paid off! Where does the money go then? Most people don't have a concrete plan for this, which is why, shortly after paying those credit cards off, those who become "debt-free" often end up right back where they started.

An equally financially unbalanced approach is to focus solely on your investments, or what "rate of return" you are getting. For one thing, if your nest-egg is completely invested in the stock market, you are taking a huge amount of risk -- let's hope you are not counting on that money for anything within the next 10-15 years or so! If you are "investing" in the market for a shorter period of time than that, there's another word for this strategy: It's called gambling! This is not a responsible way to plan for a financially balanced future.

Besides, if you are only thinking about "rate of return" on your investments, as a stand-alone piece of your financial picture, you're actually focusing on the wrong concern to begin with.

Why?

Remember that debt we just talked about?

Here is common example shared by a personal wealth-coach and friend. His client, Joe, has about the national average in credit card debt -- about $8,000 -- and he is paying 15% interest. He also has some savings -- mostly in CDs and money market accounts -- totaling about $15,000, which is earning an interest rate of approximately 3%. 

When you look at this example as a whole, it doesn't take a genius to see he is going backwards!  (Hint: If Joe took enough money out of his savings to pay off the debt entirely, he would immediately have a 15% return on his money!)

The situation above is extremely common in our society, and is a result of looking at each piece of your financial picture as a separate entity, with no effect on the other areas. Approaching your financial picture holistically, in a responsible and balanced way, as with the other areas of your life, will bring a greater sense of financial balance and strength, as well as providing a more stable and secure future for you and your family in the long term.

While there are various strategies which can help with this (along with discipline and commitment), at New Holistic Living, we favor a financially balanced strategy called "Bank On Yourself" (also known in some circles as "The Infinite Banking Concept").

The Bank On Yourself concept addresses each of the issues above, with regards to balancing your whole financial picture. This method offers a safe, guaranteed place (savings) to grow your wealth (investment), and meanwhile you can use it to become debt-free -- for good! When you learn this method, you will be able to in essence, "become the bank" for yourself, and keep most of the interest charges you would pay to debtors, to further grow your wealth.

You can also set up this type of plan to leave money to charity, which completes the picture of financial balance, as giving money to help others is one of the best ways to bring fiscal harmony into your life.

There are a number of resources for learning more about Bank On Yourself. You can visit www.bankonyourself.com for some real-life stories of people who have been using the concept, as well as a short report on the concept and how it works, ways to find a certified advisor who knows how to teach the concept, and many other resources. For more detailed information, we also recommend you look up Becoming Your Own Banker, by R. Nelson Nash, and The Pirates of Manhattan, by Barry J. Dyke. These books are more extensive and technical, but will further your understanding of the method once you have grasped the basic concept. (Warning: They may require multiple readings, as this is quite a paradigm shift for most people in our society!)