Well, you can relax...because in this one special report
you're going to learn what you need to know about finances so
you can cut through that blizzard of financial information out
there to find exactly what you need to know and discard the
rest. The bottom line is that there are only 7 essential money
skills that will take you to financial security. Seven things
that wealthy people are good at...that take them with
certainty toward financial success. You only need to do seven
things well. I call these Money Skills. And they are:
Money Skill #1. Value it
Money Skill #2. Manage it
Money Skill #3. Save it
Money Skill #4. Invest it
Money Skill #5. Make it
Money Skill #6. Shield it
Money Skill #7. Share it
Money Skill #1. Value It
So lets get right into it. Money Skill #1 is to learn how
to value each and every dollar that flows into your life.
Because you can achieve Financial Freedom on just a Dollar a
Day! That's right. A dollar a day. When you think about it,
financial freedom all starts with a single dollar.
Dig one our of your wallet or purse and examine it. This
simple piece of paper doesn't appear to be worth much. Buys
you a soda. A chocolate bar. A bad hamburger. So what if you
waste one, or lose one or throw one away? It's just a dollar.
Losing value every second. It's just a dollar. Use it or lose
it.
Or is it? Is this ordinary dollar bill more than what it
appears to be? Could it be a magic ticket to a fuller more
abundant life of anywhere/time/thing you want? I promise, when
you've finished done with this tape, you'll never think of a
dollar bill in the same way ever again. Ever.
You see, prosperous people don't think a dollar "is
just a dollar." They imagine it is a seed...a money
seed...that has the power to grow into a huge money tree,
giving off fruit to fulfill every one of their dreams.
And they are absolutely right.
Every dollar is a money seed. Just like a tiny acorn
contains the power to grow into a mighty oak tree, each dollar
has the power to grow into a mighty money tree. If you destroy
an acorn, the oak tree inside also dies. So, too, with a money
seed.
You can grow one of these money trees...on as little as a
dollar a day. Could you afford that?
In a few short years, your money tree will be full grown
and majestic, growing right in the center of your future dream
home. Imagine that! Branches of your money tree spreading
along the ceiling into every room of the house. Every few feet
or so is a nodule which pops open once or twice a day...and
releases the fruit of the tree...a crisp one hundred dollar
bill. That hundred gently floats down and lands in the
strategically placed basket. All night long you hear the pop,
pop, pop as these nodules open and release their fruit. It
takes only a few minutes to collect the fruit in the morning.
24 hours a day, your money tree is producing fruit. While you
sleep. While you work. While you play. While you eat. It never
stops. An endless stream of cash flow. Get the picture? That's
why it is so important to preserve and protect each of these
money seeds. Every time you waste one of those silly, green
pieces of paper, it's just like throwing away a money seed. No
seed? No tree.
So, how much is one those seeds really worth? That depends
on how long you let it grow and at what rate of growth. Let's
suppose you take one dollar and put it into a special bank
account that will let the dollar grow, untouched by taxes and
fees. How long will it take for this ONE SINGLE DOLLAR BILL to
grow into a MILLION DOLLARS? That depends on what interest
rate the bank account pays. If it's like ordinary bank
accounts...paying 3 to 6% interest...then it's going to take a
long, long time.
At 3% it will take 468 years for a single dollar bill to
grow into a million dollars.
What? Not planning on living 468 years? Relax. We're not
done with that dollar bill yet. We've got to supercharge it,
so those nodules can start popping in your lifetime. How can
we do this? Rather than just planting one money seed, could
you plant them more often? Could you afford to put away a
dollar a day? Just a dollar a day. $30 bucks a month! You can
do that.
Well, a dollar a day at 3% grows into a million dollars in
only 147 years. That's still not fast enough, is it?
What if we raised the interest rate from 3% to 5%. That
cuts the time down to about 100 years. Still not fast enough.
How about ten percent interest? Only 56 years.
Hmmm. Not bad. A dollar a day becomes a million dollars in
only 56 years. Let that sink in for a minute. A measly dollar
day can grow into A MILLION DOLLARS in a the span of a normal
lifetime. If you put just a dollar a day away for each of your
children or grandchildren on the day they were born, they
could all be lifetime millionaires.
But what about you? Is it too late for you? Could you still
be a millionaire on a dollar a day? It's going to take some
fancy work, but I think there's even hope for you. First of
all, we'll have to find ways to fertilize your dollars so that
they grow even faster. Suppose someone had put a dollar a day
away for you ...stuck it under the mattress...the day you were
born and every day thereafter. By the time you were to reach
retirement age...there would be $25,000 waiting for you. Now,
what if they stuck it in a bank at 3%. There would be about
$75,000. At 5% there would be just under $200,000. At ten
percent interest, there would be $2.7 million. At 15% there
would be $50,000,000. That's right. Fifty million dollars. And
at 20% there would be...One Billion Dollars!. That's one
thousand million dollars. All from one dollar a day.
I hope that sinks in deep. Most of us waste dozens of
dollars a day without even thinking. No big deal. It's just a
dollar. But extremely prosperous people know the real truth
about dollar bills. Each dollar bill is a million dollar money
seed. After all, it only takes a dollar- a-day...JUST A
DOLLAR...to grow into a fortune.
Now, it's no small feat to make your money grow at 20%,
year after year. I'll show you several ways to do this later.
But for now, I want you to just become aware that a single
dollar bill has incredible power.
You could be a millionaire in about 30 years on JUST A
DOLLAR A DAY!
Still not fast enough for you? OK, there's a way to speed
things up. Could you plant two or three seeds a day? Or five?
Or ten? What does that do? We'll let's cut right to the chase.
If you put ten lousy bucks a day away every single day and put
it in the right mutual funds, or stocks or real estate and let
the clock tick at 20 %, you're a millionaire in just 20 years!
(Pop, pop, pop, pop) Excited yet?
What makes a few dollar a day grow into such huge amounts
of money? It's the power of compound interest. You've heard of
this before but I want you to really understand the concept
because it's going to power you on to your dreams. Einstein
himself, said, "The most powerful invention of man is
compound interest." Compound interest is a magic money
magnifier. Compound interest works for you while you sleep.
Remember, money that's compounding never sleeps. Every
second of every day. 24 hours a day. 365 days a year. You've
got to figure out a way to get money working for you instead
of you working for money. And all it takes is a few lousy
bucks a day! You don't have to be a financial genius. You
don't have to own a big company. You can do it from your
kitchen table using the money that you're now foolishly
throwing away. If you just re-divert a few of your ill-spent
dollars and funnel them to some well-timed investments, you
can achieve financial success. It's within your grasp.
Look again at that dollar bill. Take care of it. It's a
money seed. I'll bet you'll think twice before you throw away
one of those silly, green pieces of paper. It's like throwing
away the seed to a million dollar money tree. (maybe even a
billion dollar tree.)
Every time you save one of those money seeds, you start
your way to wealth. The real key is to keep socking away the
money, even if it's only a dollar. Let the numbers whisper
their silent but relentless message. Consistency. Day in. Day
out. Save. Save. Save. Invest. Invest. Invest. It doesn't much
matter what investment you choose. Low yielding government
securities are fine...just as long as you invest consistently
for the long haul.
Constantly save. Consistently Invest. Like clockwork. Old
Faithful. It might be boring. It might be dull. It might be
hard. It might take discipline, persistence, sacrifice. No
matter. Just do it.
I met a young man in Chicago who had made the decision to
make his future bright by dimming his desires today. He worked
full time as did his spouse. If they had been like the normal
(broke) young married couple, they would have pooled their two
paychecks and bought a new car (with a fat monthly payment)
stretched themselves into "too much house" and
stressed out for the next 30 years. Instead, this young couple
make an uncommon decision. They decided to live in "too
little house." Then they disciplined themselves to get by
on her paycheck and to save his entire $2,000 a month income.
They put the money into well-selected mutual funds and watched
the cash begin to pile up.
This is true prosperity.
Live on less than you earn.
Invest the surplus.
Avoid debt.
Build long term security
It's my not be get rich quick. But it's get rich sure.
It's not the exciting rabbit.
But the tortoise laughs slowly all the way to the bank.
But there will be no billions, no millions, no thousands,
no nothing at all unless you get started with this plan... you
need to start today. Because waiting even one day can be
extremely expensive as I shall now demonstrate.
Suppose you could sock away $200 per month. You set a
target to have it grow at 20% per year for the next 20 years.
Now, 20% is no small feat...but with some fancy stock picks,
some real estate and perhaps a small business on the side, you
think you can pull it off. According to my calculator, $200
per month at 20% for 20 years grows into $632,000. Not bad!
Now, suppose, instead of starting now, you wait a year to
get started. This leaves you only 19 years of growth instead
of 20. How much is in your bank account in 20 years from
today? Only $516,000. That's $116,000 less than what you could
have had if you had started on schedule. In other words, your
procrastination cost you $116,000 future dollars!
Procrastination is expensive.
For each of the 365 days that you waited, your future
portfolio was shrinking by over 300 dollars. (116,000 / 365=
$317.81) In other words, every day you put this plan off,
costs you $300 future dollars. Every hour you wait costs you
more than $13. You are wasting 13 dollars an hour, 24 hours a
day.
What if you were to invest the same $200 per month over
thirty years? The cost of waiting that extra year is now a
whopping $842,803. That's right! Waiting an extra year cost
you almost a million future dollars. That's over two thousand
dollars a day. Or almost $100 per hour!
Let me say this again for emphasis. Every day you wait,
every hour you delay, is like burning up your financial
future. Do it now. Yes, it will take sacrifice. It means
deferring gratification for a while to allow your money tree
to grow. When you prematurely pick the fruit from your money
tree, you stunt it's growth and this can dramatically slow
down the time for you to enjoy a fully matured, fruit bearing
money tree.
Now, why do all of this money multiplying? In the truest
sense, money is a spiritual concept. With proper planning, you
can not only take care of yourself and the ones closest to you
but you can leave a positive legacy for your posterity. If you
won't do it for yourself, at least do it for them.
Now, look at that dollar bill one more time.
This simple money seed contains the power to bless you and
countless future generations...if you'll start now. A wealthy
future is awaiting you. It's worth the sacrifice. Let nothing
divert you from your task. As we continue, I'm going to share
with you the six other secrets or skills of that will make
this bright financial future become a reality for you.
Remember, it all starts with a single dollar bill.
The Rockerfeller Rules
As I said earlier, money is a game. If you know the rules,
you win. And if you don't know the rules, you don't win.
Warren Buffett, who became the world's wealthiest stock market
multi-billionaires has two important rules. Rule #1. Never
lose money. Rule #2. Never forget rule #1. And here are some
other simple rules to the Money Game..
Every dollar is a money seed.
You can grow rich on the money you're now wasting.
You can't make poor decisions today and expect to be rich
tomorrow.
The longer you wait to get started the steeper the climb.
A dollar squandered today destroys a hundred thousand
future dollars.
And since you are planning on spending a lot of time in the
future, it would be nice to have plenty of money there waiting
for you when you arrive. Wouldn't it? So if valuing money is
skill #1. What are the other 6 skills? Let just say, that a
couple of the skills are hidden in the following quote from a
book called Kids and Cash about the Rockerfeller family. Let's
see if you can pick them out.
According to Nelson Rockerfeller, the one time Vice
President of the United States, his father John D.
Rockerfeller, Jr, gave each of his five sons an allowance
"We got 25 cents a week, and had to earn the rest of the
money we got." To earn part of that extra money he raised
vegetables and rabbits..."We always worked. All the boys
were required to keep personal daily account books. They were
required to give 10 percent of their income to charity, to
save 10 percent, and to account for all the rest." They
had to balance their account books every month and to be able
to tell what happened to every penny they earned. (From the
book, Kids and Cash Ken Davis and Tom Taylor 1979 Oak Tree
Publications)
The Rockerfeller kids were taught a specific pattern for
dealing with their money. I call them the Rockerfeller rules.
Work for all you get
Give away the first 10%.
Pay yourself the next 10%.
Live on the rest.
Account for every penny.
Isn't it interesting that Rockerfeller made his kids learn
the habit of work? But why do you think Mr. and Mrs.
Rockerfeller taught their kids to give the first 10% to
charity? Now, if you're an atheist or an agnostic, or in any
way squeamish about the subject of God, you'd better skip over
this section. It's just going to make you all grumpy. But if
you believe there is a Supreme Being, then, read on. The
Rockerfellers, like almost all of the great American
billionaires, looked upon their wealth as a sort of spiritual
stewardship. They believed that God gave them the money. It
wasn't theirs...they just were caretakers over it. They felt a
duty to manage it for the betterment of others...while
thoroughly enjoying it themselves, of course. If every dollar
they received was a gift from God, they were glad to pay 10%
of it back. (Andrew Carnegie gave all of his wealth away
before his death.) You'd be surprised how many very successful
and very wealthy people today and throughout the past 200
years have felt the same. God, for them, was always the best
silent partner. And they didn't do too badly for God and his
children, either. Today, the Ford Foundation gives away
hundreds of millions of dollars PER YEAR to various charities.
The Rockerfeller foundation gives away almost 50 million
dollars.
I wonder if God knew this was going to happen. Looking down
on the earth in the late 1800's did he say to himself.
"To whom shall I give the idea for the automobile? And
which lucky person is going to end up with the concept of oil?
Hmmmm...let's see. There's that Rockerfeller fellow. He's
going to end up pretty decent. And most of his money is
eventually going to go to help others. I think he should get a
big chunk of oil. There's that scrappy Henry Ford down there
in Michigan. He's got a few glaring blemishes but eventually,
the money he makes with this idea is going to belong to his
foundation and will bless millions of people. Let's give him a
big chunk of the automobile."
How did Bill Gates end up with the computer? Or Andy Gove
with the silicon chip? Or the guy (what was his name anyway?)
who started Amazon.com? These days, billions can be made and
lost in a single day in the stock market. Who's going to get
the next billion dollar concept? Do you deserve to get it?
What would you do with it if you got it? Could God trust you
with it? Would you squander it? Or would you be a wise steward
over it? Would there be anything left to bless the lives of
others? Tough questions. I would encourage you that, no matter
what your financial circumstances, invest 10% right off the
top in your favorite charity or church. If you don't know
where to put it, follow your heart. One day, all the money in
the world, will not keep your heart beating. Sharing 10% with
others will remind you that God owns everything and we're
transients here.
Now, after you pay the first 10% to your "Silent
Partner" you need to pay yourself next. In the classic,
"The Richest Man in Babylon," George S. Clayson
tells the story of the wise investor whose primary rule was,
"A part of all you earn is yours to keep." (If you
haven't read this book yet, buy it today and read it.) And
then, when these two items are taken care of, Live on the
rest. Make the decision that, starting today, you will no
longer go into debt to support your lifestyle. You're going to
live below your means...no matter what. It may take you months
to turn your spending patterns around (for an oil tanker to
change course 180 degrees takes many, many hours and hundreds
of miles to accomplish...you're like that tanker, it will take
time to turn your financial bad habits into good ones...so be
patient with yourself.
And finally, Account for every penny.
This is the part that all of us seem to hate so
much...accounting for every penny. I remember when I was doing
my initial research, I looked, in vain, for a way out of this
requirement. It seemed every successful money manager I
interviewed was scrupulously meticulous about knowing where
every penny went. And, of course, this was the exact opposite
of my personality. Although my father was an accountant, I
just didn't seem to be blessed with the same genes. I knew how
to spend money really well...but I couldn't save a dime. One
day I woke up and realized that in my business career I had
literally gone through millions of dollars in profits and
royalties. If I had religiously saved 10% of that income...if
I had lived the Rockerfeller rules...I should have had a bank
account filled with millions of dollars. But I didn't. I asked
myself...of all the millions that had gone through my life,
couldn't I have lived on 10% less. Of course, and that's when
I started to live this rule.
Now, I know that the subject of budgeting and saving and
penny pinching seems tedious to most Americans (as it did to
me for most of my adult life), yet, I can also attest to the
fact that these skills or habits must become part of your life
if you ever hope to achieve any measure of financial success.
Don't give me your old excuses. I used all of them myself at
one time or another and not one of them every made me richer.
Don't you dare tell me you're not good at math, or that you
hate to balance your checkbook, or that you don't have a head
for numbers, or that you never went to college, or that you
don't know how to work a calculator, or that your spouse takes
care of that stuff, or that you don't have the time, or that
life is short and that you'd better enjoy it while you can.
Odds are, you're going to live to a hundred years old...that's
thirty five years past retirement... and you must plan for it
by taking charge of your finances NOW.
You can't delegate this to anyone. You've got to do it.
Truth is, nobody can watch over your money like you can.
(Farmers have a saying that the best fertilizer is the
farmer's own shadow.) Strangely enough, when you make the
commitment to watch every penny, the dollars start to add up
quicker. If compound interest can make a single dollar bill
grow into a million dollars...then it can also make a single
penny grow into a million pennies... and that's ten thousand
dollars. From a single penny? Have you ever walked by a penny
on the sidewalk and not picked it up because it was just a
penny? The truth is, that hidden beneath that penny is a pile
of a million pennies. Pick up that penny and invest it right.
Money Skill #2. Control It
So, having said this, I want to teach you a simple, easy
and extremely powerful way to think about your money. What
Rockerfeller was teaching his kids was how to control their
money. And that's the second of the 7 money skills.
Controlling every penny that flows through your life. Let me
show you how to control your money by teaching you a theory I
created called the Bathtub Theory of Economics..
Most people have one simple faucet or main source of
income...their job. This income flows into the bathtub of
their life and flows out through the drains at the bottom.
Most everyone spends every penny their earn...and then some.
They never retain any money in savings. They spend it all.
Obviously, the only way to have an overflowing prosperity in
your life is to plug up those holes and to turn on more
faucets...to have Multiple Streams of Income.
How many leaks are there? I have simplified the many ways
you can spend money into ten categories. It's easy to remember
the categories. Each one flows in order of their priority.
According to Rockerfeller, where should the first dollars go?
That's right, to your partners. Who are your partners? God,
first. Yourself, next. And Uncle Sam, third. Then, you can
live maintain your lifestyle with what's left over.
Therefore, the first category is called Tithing or
Charity(which represents your contribution toward God, church,
God, charity, others, giving, etc.) I have given this category
the number of 1.
The next category in order of priority is called Self. Take
the next 10% of your money and put it into the Self
category...with a number of 2.
Next, comes your partner, Uncle Sam. The third category,
then, is taxes...and I give it a number of 3.
What's the next most important expense of your life?
Category 4 is your shelter...in the form of house payments or
rent payments. What comes next? The fifth category is for
household expenses such as food, clothing, television, normal
living expenses attributed to living in your place of
residence. This will amount to your largest category. Then
comes category 6...Auto. Gotta have a car. Every time you pay
for gas, transportation, repairs to your vehicles, or car
payments, you should put it in the category 6. Next is
Category 7 for Fun or entertainment. Usually, whenever you
spend money out of the home on movies, fast food, travel or
toys, you should think of these expenditures as happening in
Category 7. Seven is the number for fun...that's how I
remember it. Then, comes Category 8; for all forms of
insurance; health, life, disability, liability, house,
homeowners, etc.
Miscellaneous expenditures (including payments toward debt)
come under category 9 Debt/Miscellaneous.
And finally, there is Category 10...for business
expenditures. Let's review:
Category 1 Tithing
Category 2 Self
Category 3 Taxes
Category 4 Shelter
Category 5 Household
Category 6 Automobile
Category 7 Entertainment
Category 8 Insurance
Category 9 Debt/Miscellaneous
Category 10 Business Expenses
Now, I want every dollar you spend to be labeled into one
of these ten categories. I've kept the categories simple and
broad because if it gets too complicated, you won't do it.
Even when in using a computer finance program, like Quicken,
which I use, I have all my categories simplified into these 10
categories. You'll see why in a minute.
So, let's examine a money transaction...which I call a
Money event. How many times a day do you spend money? 5 times?
Ten times? Rarely more. Think of it. You only spend money a
few times a day. And yet, those few decisions make all of the
difference between poverty and wealth. Actually, the
millionaire spends approximately one minute more per money
event than the poor person. And that one minute makes a huge
difference.
Let's explore what I call the Millionaire's Minute. If I
could show you a simple one minute exercise that you performed
every time you spent money...that would almost guarantee that
you'd become a millionaire...would you do it? Let's examine a
typical money event.
Average people go to the store to buy something. They are
in a rush, running late. They quickly snatch up the desired
item without comparing prices. While they're waiting in the
check out stand they see a few impulse items they pick up.
They pay for the items but don't record the event because
other people are waiting in line and besides, they're running
late. They rush off "a day late and a dollar short."
Millionaires, on the other hand, take a few extra steps
which take less than a minute. First of all, before they
enters the store they decide only to buy the planned item and
nothing else. Life is full of things to buy. They can't allow
their impulses to derail their decisions or to control their
life. Then, they spend a few extra seconds to compare prices
and to pick the best value. If appropriate, they locate a
sales clerk and ask if there is a possibility of obtaining a
discount in price. They make a quick mental calculation of
their savings. This makes them feel good. Then, they take the
item to the check out stand. Once again, they are not
sidetracked by impulse buying. They select one of the three
methods of payment: cash, credit card or check. They exchange
the money for the items, collects their receipt, examine it
for accuracy and put it in their wallet or purse for filing
later. Then, they make the most important step...they record
the event by writing down the purchase, determining which
category of spending it was made in, calculate the remaining
balance in their account. Later, at home that day, they file
the receipt in a well organized manner for easy retrieval.
All told, on average, the millionaire spends about an extra
minute per transaction than the poor person. But look at the
savings in time and money. The millionaire saves from 10-20%
in comparison shopping. (What if you could lower your annual
spending by 20% without a lot of sacrifice?) Then, by
investing an extra minute to record the transaction and to
file it properly, she has at her fingertips a vast source of
information. She knows her current account balances. She can
compare he spending to previous months and notice trends. She
is more aware of her actual spending which gives her much
greater control of her finances. She can calculate her tax
consequences in minutes not days. She can back up her tax
decisions with instant documentation. In a case of dispute,
she knows where, when and how she spent her money and has the
receipt to prove it. She is in control. And the resulting
peace of mind creates a feeling of power. This increases her
confidence, creativity and judgment. She makes fast, correct,
decisive decisions. This gives her that secret millionaire's
advantage.
So, from now on, every time you spend money take an extra
minute to do these simple things...
1. Plan your needs and procrastinate your wants
2. Shop for value
3. Ask for and expect a discount
4. Examine your receipt. Categorize your receipt. Actually
write a number from one to ten on the receipt...so that you
mentally decide which area of your life you are spending money
on.
5. Balance your accounts...whether it's cash, check or
credit card. File your receipts when you get home.
It's simple. Get ten manila folders and number them from
one to ten. Don't throw your loose receipts into a shoe box.
File them daily. This will get you in control of your finances
in a few short weeks. Now, there are lot of advantages of
doing it this way...but let me give you one big one. Taxes.
Most of us don't get receipts, and when we do, we forget what
it was for. Suppose you buy a box of pencils for your small
business...and everyone in America should have their own small
business. This is a tax deductible expense. Uncle Sam lets you
take this expense off the top before you calculate your taxes.
Well, if you're in the 30% tax bracket, then every dollar you
categorize as a tax deduction gives you a 30% return on your
money. Did you get that? Hello? Where can you, today, get an
instant 30% guaranteed return on your money? From Uncle Sam.
When you get and keep the receipt for a tax deductible expense
and then deduct that expenditure on your taxes, you're making
30% on your money...30% return on your money is the kind of
return that makes millionaires...fast.
I heard once, I don't know if it's true but I believe it,
that because of tax deferred or tax free investments the
billionaire Ross Perot only pays 6% of his total yearly income
in taxes. He understands the value of money and how to plug
those leaks...and that's why he's a billionaire and you and I
aren't...yet.
The key to financial planning is cash flow management.
You've not only got to get the cash to flow into your bathtub.
You have to manage the leaks so that there is money left over
at the end of the month (profit.) With this profit you buy
stuff...assets. You may also buy stuff by going into debt. The
object of the money game is to accumulate enough assets so
that eventually the income from your personal assets will
support you instead of your personal skills.
Are you good at turning on faucets? Gotta get those
multiple streams of income flowing into your bathtub.
Are you good at plugging leaks? Gotta plug those leaks.
Are you good at getting stuff? Are you accumulating assets?
Are you good at repaying debts? Gotta stay out of debt.
The better you are at managing and controlling these four
activities, the wealthier you'll become.
Wealth Skill #2. Control your money. Start today to gain a
greater control over your money by doing the millionaire
minute...you'll be amazed.
Money Skill #3. Save it
Wealth Skill #3 is to save money. Wealthy people love to
save money...you know, to buy things at wholesale. They never
like to pay retail for anything. And now, you know why. But
they don't stop there. You see, anyone can save money by
buying at a discount...but do they save the money that they
save? That's the hard part. A friend of mine quit smoking and
was bragging about the $50 a month she was saving by not
smoking. I asked, "Where is the $50?" She didn't
know. She had saved the money but she hadn't saved it...put it
away. When you save money by changing your buying habits, take
the money out of your purse or wallet and get it out of your
spending grasp. Put it into a savings jar, and frequently
deposit this money into your savings account. That's when
you've truly save/saved it.
And here's another tip. Would you like to learn how to cut
your living expenses by 30% in 30 seconds? You would? Well,
take out your credit cards, put one away for emergencies, and
cut up the rest. Statistics have proven that this simple
exercise will automatically and almost effortlessly cut your
living expenses by an average of 30% over the next 12 months.
Money Skill #4. Invest it
With the money you're save/saving plus the 10% of the money
you pay yourself off the top, you must learn how to invest
your money at billionaire rates. Anyone can park their money
at 3%. The trick is to get it to grow at 10 to 20%. There are
many traditional investments that are ideal to park your
money. At the low end of the interest scale are bank savings
accounts and certificates of deposit. Then, you have
government treasuries and bonds. Up the ladder are corporate
bonds...then the stock market...and some of the most popular
investments these days...Mutual Funds. You should have money
in all of these areas. Imagine a series of buckets where money
is siphoned off from your bathtub. The first bucket should be
your emergency bucket. Let your 10% flow there first until you
have at least three months worth of living expenses saved.
You'd be surprised how many people in this country are only
one paycheck away from bankruptcy. Don't let that be you. This
money should be in the safest place possible...probably in an
insured bank account...at the highest interest rate you can
find where you can access to your money within 30 days. Once
this first bucket is filled up, the stream of 10% will
overflow into one of three additional buckets---labeled,
conservative investments, moderately risky investments and
very risky investments. If you are older, you should have more
of your money in the conservative bucket. The younger you are
the more risk you can take.
(Put graphic of the investment buckets here)
The best way to invest for average people is in Mutual
Funds. A mutual fund is a collection of individual stocks
purchased by a major company and managed by professionals. You
give them a small amount of money, they add it to that of
thousands of other investors and they watch over it for you.
You'd have to have lived in a cave for the past 5 years not to
have heard at least something about Mutual Funds.
Here are a few rules about investing.
The longer you invest (leave your money in the market) the
lower your risk.
Don't invest unless you're willing to leave it for 5
years or more. It's sole purpose is to grow and compound.
Anything shorter than a year is gambling.
Remember, it's almost impossible to buy low and sell high
in the short run. So don't play the market.
The key is long term dollar cost averaging.
Dollar cost averaging simply means, you should invest every
single month, regardless of where the market is heading. Don't
even read the newspapers...just buy month in and month out.
Over the long run, this is the best strategy. Do it
automatically. Inform your mutual fund company to
automatically withdraw the funds from your account each month.
If you have to decide each month, eventually you will stop the
program and your future will suffer. Do it every month.
When you finish reading this report, if you're not already
doing so, I want you to go to a news stand, and buy a
financial magazine like Money Magazine or Smart Money or
Kiplinger's. Look for an ad for a Mutual Fund company that is
No-Load...which means no commissions. Look for ads where they
will let you get started for $50-100 per month. Sign up for
the automatic monthly withdrawal...and get started. If you're
new at this, you'll learn a lot by just doing it. This will
turn up your awareness of the entire process. Soon you'll
start noticing ads for Mutual fund families that really fit
you. Then, you can shift your growing nest egg to the new
company and start to watch your money grow. Once you have
gotten your mutual fund investing program funded and on
automatic pilot, you should read some great books on the stock
market like Peter Lynches classic, Beating the Market. And
then, you can start putting extra cash toward a concentrated
program of investing in individual stocks.
Speaking of that, would you like the richest investor in
the world to manage your money? His name, by the way, is
Warren Buffet. He started in the mid 50's with just a few
thousand dollars and some money from a small group of
partners. Over the next 40 years he turned his initial few
dollars into tens of billions of dollars. His yearly
compounded rate of return on his money is about 20%. If you'd
like to buy into Warren Buffets brains, you can buy into
Buffets empire...where he has about 90% of his own money. It's
a stock traded on the New York Stock exchange...called
Berkshire Hathaway. It trades at many tens of thousands of
dollars per share and is the most expensive stock on the NYSE.
Buffet doesn't believe in splitting his stock price...so it
just keeps getting higher and higher...as he continues to pile
more and more money in it. (Your stock broker can show you how
to buy Baby Berkshires...at a much more reasonable price.)
There are several excellent books on the market about Warren
Buffet. If you love the stock market, you'll love to read
about how this man did it. At the very least, your goal is to
get some of your surplus money siphoned off into mutual funds
and forget them.
Money Skill #5. Making Money
Making money is an entirely different skill from investing
money. Investing is passive. Someone else does the work for
you...like money growing in a bank. Making money, Skill #5, is
the entrepreneurial side of money. Are you an entrepreneur?
You should be. Everyone will need to create multiple streams
of income in the future. Families used to be able to survive
on one income in the 50's and 60's. Then, in the 70's and 80's
it became necessary for there to be 2 income earners per
family. In the 90's, with the stability of those 2 incomes in
question, with corporate downsizing, re-engineering, or
whatever you want to call it, you need to take matters into
you own hands. You must learn the skills of being your own
boss...even if you're working for a solid corporation and plan
on retiring there. The world is just too insecure to make long
term plans with one company.
When it comes to choosing the perfect home based business,
use the MoneyTree Formula you learned in the Audio Cassette,
Multiple Streams of Income. The full program from Nightingale/Conant
will show you 7 extremely profitable home based business you
can start with little capital investment. Any of them could
take your to financial freedom. But, when you are doing
several of them simultaneously, you can accelerate your
prosperity curve dramatically. You'll love the program. Or
your money back. It consists of 8 jam packed audio cassettes
(or CD's if you prefer) plus a bonus audio and a special Study
Guide. Call 1-800-525-9000 to find out you can start on the
road to wealth today.
In the meantime, if you're going to start your own
business, remember these rules:
Rule # 1. Get on purpose. Do what you love and the money
will follow.
Get into a business that is in alignment with your
purpose and values. Here are the purpose questions:
What are you good at? What do you like to do? What is
important to you? What is your destiny?
Answer these questions before you begin.
Rule # 2. Decide on your ideal lifestyle, then choose a
business.
Rule # 3. Become the best in your field.
Rule # 4. Ride a trend that is on the wax not on the wane
Rule # 5. Be a copy cat. Don't be the first in. Don't start
a trend. Copy others...legally, of course.
Rule # 6. No se habla employees. Be slow to hire and fast
to fire.
Rule # 7. Constantly economize.
Rule # 8. Avoid overhead like the HIV virus. Rich people
don't buy fancy office equipment to impress. Warren buffet
manages his entire empire from a corner desk in small office.
He has no computer...as he once said, "I am a
computer."
Money Skill #6. Shield It
Making money is one set of skills Keeping it is another. As
you work toward your financial goals, you will need to learn
how to preserve the wealth you are creating. The new
millennium is an infinitely more dangerous environment for
wealth creation that were the 60's, 70's, 80's or 90's. New
kinds of street gangs roam the streets seeking prey...hoards
of attorneys looking for victims to represent. The worst
mistake one can make today is leave large amounts of personal
assets unprotected. You must learn how to get your homes, cars
and business entities out of sight through corporations,
trusts and family partnerships to build a financial fortress
around your assets. This information, which used to be
available only for the super-rich, must be put to use by
everyone. Why? Because if you're practicing your money skills,
sooner or later there is a 100% probability that you will be
sued...and any smart attorney will be able to look in the
public record to find out what assets you have in your name.
Therefore, the secret to smart money is to learn to live like
a millionaire but be a pauper on paper. You used to be able to
brag about your money. Not any more. Today, you don't want to
be a millionaire...just to live like one. I, myself, am not a
millionaire. Or even a multi-millionaire. I used to be. But
not any more. That doesn't mean that I don't know where it
is...and how to get to it. But the public will never know. You
must protect yourself today against the catastrophes of
tomorrow.
Here are the eleven basic commandments of financial
protection.
1. Thou shalt avoid conspicuous consumption
2. Thou shalt avoid putting assets in your name.
3. The shalt never co-sign a loan for anyone, ever.
4. Thou shalt carry adequate liability insurance.
5. Thou shalt not serve on a board of directors.
6. Thou shalt avoid all "recourse" debt.
7. Thou shalt operate thy business from a corporate entity.
8. Thou shalt not go into business without a detailed
business plan.
9. Thou shalt never enter a partnership without a simple,
fool proof plan for getting out.
10. Thou shalt never put all of thy eggs in one basket.
11. Thou shalt always assume the worst. You'll probably be
optimistic.
Money Skill #7. Share It
Finally, skill seven is to share your money. And this
really is a skill. Remember what I said about the
Rockerfellers. They believed that giving their money was
essential to their wealth. And so should you. The secret is
that money multiplies fastest when it's divided. It's all
God's money, anyway. You're just a temporary steward. When you
share freely, you prime the pump of the universe. I encourage
you to establish a legacy that will outlive you. Plant money
trees from which others will harvest the fruit. This is true
prosperity.
I have a belief which I have learned from the great
billionaires over the past century. Almost without fail, each
of them has been guided by the following principle:
"Ultimately, the only purpose for having money is
to help others."
So, to review. First you must Value money...then, Control
It...then Save It...then Invest It...then, Make It... then
Shield It...and finally Share It. I don't think it's possible
to make and keep a lot of money without being good at these
things.
Now, look at that dollar bill one more time. This simple
money seed contains the power to bless you and countless
future generations...if you'll start now. The future is
counting on you. A wealthy future is awaiting you. It's worth
the sacrifice. Let nothing divert you from your task.
It all starts with a single dollar bill.
