Who’s ready for a bit of economic warfare? I know I am after realizing I’ve given the financial raiders the upper hand in the never-ending war for control over my own finances.
Truth is, all of us are in a financial war.
We battle each day against corporations, marketers, scammers, and worst of all—ourselves—in a never-ceasing fight to survive, prosper, and build wealth.
One way we can do it is by incorporating the timeless strategies in Sun Tzu’s The Art of War into our financial management plans.
As such, I’m going to talk about the 13 principles of The Art of War, and how using them can help us become financially victorious. And like any real war, everything starts long before the first shot is fired.
Laying Plans
Financial wars are won or lost before we even begin the fight.
Most people are moving through life with no specific financial targets, no structure, no plans. It’s only: earn and spend. And before they know it, they’ve been wiped out by the financial enemies who’ve been plotting all along.
The key to winning the financial war is to have a plan. Think of yourself as if you were your own personal CEO whose mission is to grow your company (you) to its full financial potential—how would you do it? You’re clever, so I already know your answer is you’d start by making a plan on how you’d reach your goal. And that’s exactly what you will do to win the financial war.
Waging War
Financial warfare is expensive—your goal should be to achieve victory as soon as possible.
Sadly, in this never-ceasing war for economic supremacy, too many of our brothers in arms are stuck in nasty economic trench-style warfare that comes about when you’re mired in debt, living paycheck to paycheck, or unable to wrangle in self-destructive habits.
Even if it’s going to take you several decades to win the ultimate victory of financial independence, you should be aggressively working to establish an interim state of financial peace consisting of:
Adequate earnings that allow you to cover all of your basic needs while leaving a surplus
Internal contentment and discipline helping you avoid FOMO or keeping up with the Joneses
Robust, nimble automation for saving, investing, and monitoring without complexity
Getting there won’t mean you can necessarily take your foot off the gas, but it would at least signal that you’ve gotten a firm upper hand in the ongoing fight. And once you have that footing, the next step is understanding exactly who—and what—you’re fighting against.
Attack by Stratagem
Know both your enemies and yourself well.
Here’s a question for you: how much of your lifetime earnings have you managed to keep for yourself? If you can’t answer that, it probably means you don’t really know yourself or your financial enemies very well. And that’s not because the money disappeared—it was extracted by the enemies.
Once you accept that your money has been leaking away, the first step here is to pause and tally up the losses you’ve already incurred in your past economic campaigns. Actually sit down and calculate your lifetime earnings. Then calculate your net worth. And after that, conduct a cash-flow and spending audit followed by a review of your money blueprint to see where it needs updating.
And you’ll be in a very strong position to start doing something about it.
Tactical Dispositions
Do not put yourself in a position to be defeated. Be anti-fragile.
From a tactical standpoint, by staying debt-free, always living below your means, maintaining at least a 50% savings rate, and not owning too much stuff (such as a house), you will achieve a tactical disposition that makes you all but impervious to financial defeat.
In such a position, you will quickly accumulate a pile of cash and other assets that will serve as both your freedom fund and your wartime cache for when times get tough. You’ll be nimble and flexible, clear-minded enough to make important decisions, and unencumbered enough to move about as necessary to seize opportunity.
Energy
Create momentum and force through productive means.
Consistency matters more than intensity. Like an avalanche that starts as an unnoticeable ripple and finishes as an unstoppable surge, your productive means of working, earning, saving, investing, and creating will eventually compound into a kinetic force that works for you, even when you sleep.
Weak Points and Strong
Find your edge, know your weaknesses—and those of the enemy.
Your edge is the thing or things you are good at, the passions you have, the sources of specific knowledge, and the unique experiences you’ve had that give you wisdom others can replicate. Work in areas you naturally excel and use knowledge you have for profit.
Remember, though, you also have weaknesses. And your enemies are also strong and weak in certain ways. This isn’t abstract. For example, you may be a sucker for fast food, and it just so happens that the evil corporations chasing your dollars specialize in marketing burgers, snacks, and sugary drinks—all the things that make you weak.
For the person above, it could be limiting exposure to television and ads.
Maneuvering
Aim for clarity, simplicity, and coordination with your finances.
Having too many revolving bills and too many open accounts can quickly become an organizational nightmare that causes you to miss due dates or forget about funds that could be used to get you further ahead.
One of the best maneuvers you can make with your finances is to streamline your financial arrangements. Move your automated payments to a single credit card and close the rest. Look at the slew of bills that come each month to assault your pockets and close the ones you don’t need. Track down those old retirement accounts and move them to a single location so you can keep an eye on all of your funds more easily.
Variation in Tactics
Don’t put all of your eggs in one basket.
Diversify your investment approach as well as your money-making approach. Constantly review your portfolio to determine if you are positioned to capitalize on market trends and realities of your current and future situation. Continuously learn, retool, and upskill toward valuable new skills so you can easily pivot in your career should the need arise.
The Army on the March
Pay attention because people and systems always leak valuable information.
Signals matter. For instance, doesn’t it seem like war is likely to break out in Venezuela or over in the Middle East? If you said yes, then that may be a sign that you need to figure out what you could do about it to either benefit or protect finances—but either way, you should be on top of it and not passive.
Once I’m finished mastering the two learning curves (software + Spanish), I’ll be turning my attention toward slowly gaining a deeper understanding of investing, economics, geo-politics and markets so I can have a stronger grasp of the terrain. I highly suggest you do the same.
Terrain
Choose Your Battlefield.
Put simply, go where you belong. Take responsibility for your environment. Choose what things you will invest in based on your skills and interests while ignoring the rest. Don’t get caught following the crowd, and avoid chasing the wrong goals just because they match what everyone else is doing.
Terrain
Concentrate your energy and hoard your strength.
In spite of modern life offering us many options to choose from, it’s best to focus on only a few.
One of the biggest drains on focus today is social media because it is a tool that is not only capable of stealing our attention—it entices us out of our money while simultaneously tricking us into thinking that what we already have isn’t enough.
But we must also discipline ourselves to do something which I struggle with: focusing on one project at a time versus starting too many things and thus being slowed down across them all.
Attack by Fire
If it is to your advantage, make a forward move; if not, stay where you are.
What this really means in practice is to be content and enjoy your life during the good times. Don’t grow restless and seek change for the sheer sake of doing something new.
Now, that doesn’t mean that there is anything wrong with doing new things either. But if things are working, allow them to work and turn your attention to other endeavors that don’t bring about undue stress and difficulties for no reason.
The Use of Spies
Information is the ultimate force multiplier.
The more you learn and the better your monitoring systems, the better able you will be to wage economic warfare.
Deploy automated systems to spy on your own money: spending trackers, budget platforms, and investment portfolio monitoring. All of these are your greatest allies that will keep an eye on things behind the scenes when you’re busy, and they will give you status reports and notifications when you need or seek them.
And remember: you aren’t alone in this economic battle. Thankfully, the internet has you covered with many blogs and websites dedicated to analyzing and synthesizing information for you to consume. Consider these sources to be like spies you send into the field to gather and bring back intel.
Conclusion: Raiders At The Front Gate
In case you missed me saying it the first time around, I’ll say it again: the financial war is already happening. The financial enemies who’d love to separate you from your money know this. It’s time you did too.
The raiders are at the front gate. They usually don’t always announce themselves, but once you let them inside, they quietly drain you little by little until there’s nothing left.
The gate to your finances is either guarded or it isn’t. It’s up to you.