Pay close attention to the ideas inside of today’s post, because it contains the seeds for all of your wealth and abundance.
Everyone I meet in my financial services practice tells me the same thing …
… It’s hard to get ahead and stay ahead financially. For most, it’s hard to just keep up. For the majority, it’s more about SURVIVAL.
Over the past 40 years, using the philosophies that I’ve studied and applied, I’ve learned the critical, essential elements that will lead anybody who has this knowledge to more wealth, abundance and success.
When it comes to your personal financial success, there is one rule that MUST be accepted and practiced with total faith and discipline.
Some people say … “Live on less than what you earn.”
Others say … “Pay yourself first.”
Either one will do.
Beginning right here, this very moment, and for the rest of your life, you need to COMMIT to taking AT LEAST 10% of every dollar you earn and setting it aside. This is not negotiable. If you do this, you have a chance to win the money game. If you don’t, you have no chance.
My Mom grew up in the depression of the 1930’s, and her attitudes about money and wealth were deeply affected by what she experienced during that time.
She taught me 3 simple rules …
Live on less than what you earn …
Stay out of debt …
Grow your savings …
That philosophy has done well for me over my lifetime … much better than most.
Why is it so critical to start this habit of living on less than what you earn immediately?
Unfortunately, in life, stuff happens … things we hadn’t planned on.
Sometimes, there are costs when it happens.
Something happens and we can’t work for a while.
Today, we’re seeing people losing their jobs by the thousands, and others having their hours cut back.
Without adequate savings, you are at the mercy of the system, or your family and friends.
When you’ve saved up enough to cover 3 months worth of monthly bills, you sleep much better at night.
In addition to building your “contingency fund”, you must start putting money into investments that can produce income for you.
You might be thinking right about now …
How the heck can I ever win the game if all I can save is $50 or $100 a month?
AND THAT’S A GREAT QUESTION!
How the heck can you ever win the game even starting off saving $50 or $100 a month?
What could you do with that money?
You could save up $500 and go to Vegas and put in on RED. Double your money in 20 seconds! Win 10 times in a row and you’re up to over $500,000.
Few people win the game that way.
You could buy stocks, but you probably couldn’t buy enough to make a lot of money to create wealth and abundance.
Besides, few people win the game that way either.
You could save up and invest in real estate. More millionaires have made their wealth in real estate than any other way. With savings, you can begin to look into this area.
In my opinion, the best use of this money is to invest it in a business. Today, you can start a home based business for well under $1,000, many under $500, and you have the potential to earn thousands monthly once you learn how.
Having run Peak Potentials Training, one of the fastest growing business and personal success training companies in North America, I got to meet hundreds of home based business entrepreneurs making anywhere from a few hundred dollars up to $50,000 or more A MONTH. I spent hours talking with them and finding out what made them so successful.
What I learned is that ANYONE who has a burning desire for success can learn how to build a home based business. It doesn’t take brains, or looks, or experience, or a lot of money. It does take a lot of desire, commitment, courage, a proven system and a little bit of money.
The money you set aside from each pay check is seed money for your businesses or investments. Without the seed money, all you can hope to do is survive.
Most people go to work to earn the money to pay the bills.
You go to work to earn the money to PAY FOR YOUR INVESTMENTS.
If you adopt this new attitude, eventually, your investments will bring you enough income you won’t have to go to work anymore.
Commit that you are going to begin the lifelong habit of setting aside at least 10% of every dollar you earn for the purpose of investing it for your future. Don’t give yourself any room for excuses.
You have no choice in the matter. If you want to win the money game, this is a must. Otherwise, you will struggle with money your entire life.
Setting aside 10% of your income is only one piece to your money management system. Next post, we’ll identify more of this success oriented system.
Namaste.
Jeff
Excellent advice, Jeff. In today’s ‘connected’ world anyone can start an enterprise that earns that extra money needed for a comfortable life or a whole lot more.
As you pointed out, it takes following a proven system consistently and of course not giving up.
Jim Rohn says it best, “We work at our job to earn a living so we can work on building our fortune.”
Jeff Fagin response:
Thanks for the great comment Bill. Those who see the path and are bold enough to head down it with confidence are the ones who win the game. Everyone else is an observer. Unfortunately, we have too many observers and not enough pathfinders anymore.
Thanks again.
Jeff
Great advice money master. In times of financial stress, it’s time to simplify. We must often go back to the basic ideas we know work but as a society, seem to have forgotten. I think one key point you refer to is not to be gun shy. We should still be looking to start businesses and be independent. The key now is to figure out how to do that in today’s different financial environment.
Jeff Fagin response:
Hey Howard,
Excellent point. Today, most people are frozen, unable to respond to what’s happening to their financial foundation. Now is not the time to be weak.
At a very minimum, exploring new opportunities gives a reason for HOPE, and these days, HOPE is in short supply.
Jeff
Saving money is a big key. Thanks for keeping this in the forefront because most people don’t sleep well because of the lack of savings. We have become an instant gratification society and this has hurt us.
I have always been a big advocate of starting your own business. This is the best and surest way to win the money game. These days it’s easier than ever to start a business for very little money. Many time you can start a business with no money at all depending on the business.
The one thing that’s import about starting a business though is mindset. If you don’t have the right mindset, you will have problems in your business. But, once you develop the mindset and I know Jeff has talked about it in previous blog articles, you will never look back again.
A business of your own is actually the surest and safest vehicle long term for financial freedom. I know. I had a job for over 15 years in Fortune 500 companies and got laid off. My income went to zero overnight. After 3 short years, by having my own business I became a millionaire.
If I can do this, so can you.
To Your Success,
Andy Fuehl
best selling author
Jeff Fagin response:
Hi Andy,
As always, thanks again for your comments. You know better than most what entrepreneurship is all about, heck, you wrote the book … “WEALTH WITHOUT A JOB”.
Whenever the mentor makes a comment, the student always appreciates.
Thanks Andy. I really appreciate it.
Jeff
Great post Jeff. I think you hit the nail on the head. The barriers to starting a business have come down quite a bit. Especially when you consider starting an online business. Of course not all succeed, but with a little patience you can make a decent living.
Jeff Fagin response:
Hi jgerman,
Way to be. You’ve got it.
The barriers to entry for anyone have virtually disappeared. Anyone can LEARN a proven system. But few will actually learn it and do it until they’ve mastered it. It’s when we reach MASTERY that huge success follows.
Hope to see you back again soon.
Jeff
It’s a valuable advice. We have to save money in our life and it is more important. The thing is we have to start businesses in our own independent way and that too in a challenging financial environment. Thanks for your great Post!!
Jeff Fagin response:
Hi Ragul,
Thanks for your comments.
Job security is an oxymoron. To win the money game, you have to TAKE COMPLETE CONTROL of your results. There has never been a better time for anyone who has the desire and the COURAGE to reach financial freedom.
This blog is dedicated to everyone who has that desire and COURAGE.
Namaste.
Jeff
Jeff:
Starting your own business certainly embodies much of the American dream. However, like not everyone can achieve a house with a picket fence and 2.5 kids (and when we try and force this we get where we are today with massive amounts of foreclosures), not everyone can start their own business. While some people can be entrepreneurs, it’s an impossibility for everyone to be one since there does need to be some sort of labor force to draw upon. I’d argue that while investing in stocks or real estate certainly contains risks, they are not inherently any more or less risky than starting your own business. Why not encourage diversifying one’s investments as an alternative to sinking it all into starting a business which may fail in the end?
Marcus
Jeff Fagin respone:
Hi Marcus,
Your points are all well taken and valid.
ASSET ALLOCATION is critical. If someone puts all of their savings into one bucket, especially one where there is a high probability of failure, they will generally lose the game.
HOWEVER …
I am suggesting that now for a LESS THAN $1,000, often times less that $500 you can start up a business, and opeate it for $50 to $60 a month. I’m not suggesting for a moment that you put your entire life savings into a business venture where you have no idea if you’re going to succeed or not!
Once you’re in the business of your choice, find the most successful ones and train with them. Do it long enough and often enough to master it on a small scale where you aren’t risking much money. Once you’ve mastered it, you have no ceiling on your income.
ANYONE, yes, ANYONE, can learn how to succeed. Some will do it faster than others. But it’s been proven that success is a LEARNABLE skill. If you aren’t successful yet, all that means is that there’s still SOMETHING YOU DON’T KNOW.
Thanks again Marcus.
Jeff
I’ve always had the 3-months contingency fund part in my mind. Whatever happens, make sure you can cover yourself for three months if need be.
The seed money & investment element I’m less sure about. How do you know you’re not going to lose the money (I just lost out with the stock market crashing…)? Why not just save it and be on the safe side?
Thanks for the post, though - very interesting, I’m keen to know more.
Jeff Fagin response:
Hi Jules,
Thanks for your comments.
As you probably read, I suggest that you create a “contingency fund” for a buffer. The general rule of thumb is to have 3 months worth of expenses covered. Some want 6 months. Some want 12. Heck, some want 2 years worth. What do you want?
The seed money is only for someone who wants to create financial freedom in their life. It’s the money you invest in yourself and your business. It doesn’t have to be all of your savings and investment money, but in my 55 years on this earth, I have found that professionals and executives and entrepreneurs have the greatest chance to create financial freedom.
If you’re earning 6 figures annually in your job, go ahead and save up enough to live on the interest. For most people, that just isn’t going to happen.
What’s your plan Jules?
Best wishes,
Jeff
Really do believe that investing in a business is a wise use of one’s money. Where I am conflicted is that should you save money before paying down your debts? I know that many people today are carrying an incredible amount of debt in the form of credit cards, mortgages, car loans etc. Would it be wise to pay these down first? We are doing that now and hope to see good results once the debts are paid off and then start to save and invest.
Jeff Fagin response:
Hi Brandon,
Thanks for your comment.
The skill set you require to pay down debt is completely different from the skill set you require to succeed in a business. It’s a balancing act for sure, and I believe it doesn’t have to be an all/nothing, or either/or situation.
You can pay down your debts and begin to save up for a business at the same time. Having this plan allows you to begin seeking the right home based business for you, and opens up your mind to new possibilities.
There are people every single day, (I know, because they’re my clients) who are starting from scratch and building for themselves a home based business. More importantly, they’re GROWING AS A PEOPLE, by learning and practicing what it takes to succeed. Once they have that knowledge, no one can ever take it away from them.
Thanks again.
Jeff
The advice that you have given are wonderful at this time when many people are losing there jobs everyday. The three rules taught by your mother can work as a remedy for many people. I hope many people would take benefit from it and I look forward to your future posts.
Jeff Fagin response:
Thanks as always for your comments khushe. They’re greatly appreciated.
Jeff
The article is very interesting and you have given useful and the most needed tips for the readers that is how to save money and be freed of our debts ,financial crisis etc.This makes planning accordingly and so that reduces my tension of financial problems.
Jeff Fagin response:
Thanks for your comment sundar.
Jeff
I really agree with the idea of saving seed money. Now that I have my first real job, I am saving as much money as possible. I figure the only way I could ever start a business or write a book is if I have the money saved up to do so.
Jeff Fagin response:
Hi Scott,
Way to go. You’ve got it right.
You don’t need to have much money, but you need a stake to get in the game. Once you’re in it, it’s all about being taught how to play to win. That’s exactly what we talk about here.
Jeff
My parents also saved 10% of their paycheck. They did it for 20 years and used the money to pay my college tuition.
But I like the idea of “seed” money. Saving is good, but investing some of the money in a small business is even better. However, I would NEVER invest all of my savings.
Jeff Fagin response:
Hi Siah,
You should be grateful to your parents for their commitment to your education.
The key to starting a small business, is to have have very little money at risk. You are learning on a small scale how to make a profit. Once you’ve figured it out on a small scale, you can always grow it. Many home based businesses start on a shoestring budget. You just have to have a system to follow and do it.
Until you start, you’ll never learn. Most people either never start, or else they start and they quit. This blog is for those who want to learn how to reach their full financial potential. It tells you exactly what to do.
Thanks again Siah.
Jeff
I think a crucial point is to think of the seed money as the seed that you are planting for your future success. We’ve all heard the old adage, “You reap what you sow.” The problem with so many today is that we aren’t sowing enough seeds in the right areas of our lives.
Jeff Fagin response:
Hey Christy,
Great response. Thanks.
Jeff