The One Expense You Need to Cut

   Managing expenses is nearly a full-time — (though unpaid) — job for many people. From the monthly mortgage, car payment, insurance, groceries and utility bills to family activities, there’s a long list that requires prioritizing and discipline.

   The situation can leave people feeling like they will never get ahead as their expenses seem to eat most of the financial pie chart.

   But it’s a fallacy to think all expenses are evil, says a successful entrepreneur and angel investor. In fact, he says, nearly all of them are necessary, and if managed correctly, they can even help you win financial freedom.

   “It’s critical to understand the difference between debt and liability,” says Nik Halik, also an adventurer, speaker and co-author of 5 Day Weekend: Freedom To Make Your Life And Work Rich With Purpose (www.5dayweekend.com). “The goal isn’t to simply pay off all loans, but to maximize the efficiency and production of cash flow.  

   “We’re taught to believe that expenses are bad and to cut them as much as possible, but that perspective is simplistic and misguided. In reality, there are four types of expenses, and only one of them needs to be cut.”

•  Lifestyle (consumptive) expenses. These include dining ou ...