It sounds so simple, doesn’t it? Yet, there are many of us burying ourselves in debt (spending more than we earn) or living purely from paycheck to paycheck (spending all that we earn).

Simply spending less than you earn has a cascade of positive effects. First, if you are coming from an indebted background, you begin eliminating your debts. Spending less than you earn frees up more money so you can make larger payments on your debts. Over time, the debts begin to disappear, giving you room to spend on investments.

Second, you begin to save. First, you build up some cash savings in your savings account, enabling you to roll through emergencies (like a car breakdown or a job loss). You’ll also have the breathing room to start saving for retirement, paving yourself a great future for your golden years.

Third, your stress level falls. Knowing that you have fewer debts, your emergencies are covered and your retirement is being planned for, reduces your stress level. You sleep better, your overall health improves, and you feel happier about life.

Finally, spending less leaves you with savings that allow you to explore possibilities closed to you before —you can define your destiny. When your debts are gone and you are spending far less than you’re bringing in, you suddenly have many more career possibilities. You have savings to help you do the education you have always dreamt about. You don’t have to stick with your high-stress job —you have the financial freedom to move on and chase your dreams. You can live where —and how — you want to live.

All of that comes back to one basic principle —spending less than you earn. But for you to spend less than you earn, you need to be earning more. How? First, don’t waste time idling. The time you spend sitting idle, browsing the web aimlessly, or chatting on Twitter with your buddies for hours is time you’ve effectively lost. Instead, invest that time in something devoted to your career, to planning a small business, to building strong relationships with as many people as you can in your field. Trust me you have so much potential as an individual to just waste. Every time you spend time, ask yourself if you should have put it to better use —remember, age is catching up with you — your time to build wealth is diminishing. You will prosper if you maximise the gap between what you earn and what you spend.

A blessed week-end to you as you plan to spend less than you earn from now onwards unless you are assured of earning more later from the overspending.