Thursday, December 24, 2009

A must read for those interested in financial success.

As I mentioned before, education is very important if you want to be successful at anything. It doesn't mean you have to go to a school or university to be educated. Many people overlook self education. You can learn to do just about anything with little to no money. Books are written on endless topics.

For those of you who are finally recognizing that you want more out of life than to go to and from work until you die and get paid very little for it, you need to change the way you think about how money is made. If you have realized that there is something different about the way rich people do things compared to the way that broke and poor people do things, but you haven't figured out what that is, I have a suggestion for you. Robert Kiyosaki's "Rich Dad Poor Dad" is the book you should read first. By the time I read this book, I had already learned many things about business and finances, but this book still turned on more light bulbs for me. He explains how rich people get richer and poor people get poorer. That one little piece of knowledge will set many of you free.

I will explain a little bit of it now. It is very simple. The key note is that rich people do and buy things that make money. Poor people buy things that cost money.

Some of you might read this and think, "Duh! I already knew that". Well, congratulations to you. It just means you are already aware of this fact and are set to put that idea in motion.

Others will read that and it may or may not make sense. Ok, for you, here is a little bit more.

Most poor people go to work and make a wage. They then go and spend that money on rent or mortgage, food to eat, things they want and need. For most poor people, they are lucky to break even before their next paycheck. Sometimes it's worse especially those who use credit cards incorrectly and put themselves in debt. Many times, people will spend more money than they make and create a hole for themselves to fall into.

On the other hand, rich people spend money on things that will return money to them. For example, they may own a business. That business has expenses such as inventory. When they sell items from that inventory, ideally, they are making a profit. That is, the customer is paying more for an item than the business owner spent on it. Business owners buy wholesale and sell at a higher price. Some people write books. They will spend some amount of money to get the book published with the idea that the sales of the copies of the book will return more money then it took to publish it.

I am probably not explaining this very well, so I definately suggest you read the book to learn about this and other things he writes about. The basic idea though is that rich people end up with more money coming in than going out. This grows as they use that money coming in to invest in more things that return money. That is how the rich get richer. They don't just take their money and buy lots of stuff to have. They use their profits to invest in more things that will return profits. It is a system that almost feeds on itself.

If you can find something to put your money into that will bring you more money back than what you spent, then that is one stream of income. Then you repeat that over and over to build multiple streams of income. The trickiest part is to get that first stream going. Once you have it rolling, just keep it growing.

I hope that someone benefits from this and I hope you read that book if you have not already. It will be a real gem on your bookshelf. Just keep on learning.

Wednesday, December 23, 2009

Mental gears spinning

So, there I was, armed with some interesting knowledge from my first business adventure. My mind is spinning with all sorts of new ideas and things I wanted to try. Just one problem. I am 20 and broke. The phrase, "shoe-string-budget" came up a lot. I brainstormed with a friend of mine and my mother and my first personally driven business was born. We created Marooned Shirts. Yep, you guessed it, a T-shirt business. We had a great setup too. There were 3 partners in this business. My friend who was the main artist, my mother who was and still is very good at book-keeping, and myself who handled a lot of the "running the businesss" type stuff. I managed the licenses, made contacts, hooked up deals, found the vendors... all that stuff. It was working out well. I learned a number of things while in our short lived shirt bizz. Among those things were, how to deal with vendors, how to analyze your business strategy, the basics of dealing with other people who are in business. Our business failed, which you will find is not actually such a bad thing. There was a bad step in our process. Because we were operating on a very small and limited budget, we couldn't mass produce our shirts which means we could not take advantage of the cost breaks for purchasing larger volume. There are many businesses out there that do really large volume in sales and make pennies on the dollar, but they make a whole lot of pennies which is why it is worth it. A small operation like we had depended on cutting costs where ever we could. Because of the type of art we put on our shirts, we had to pay for an extra step in order to get the pictures from the drawing board to the screen printer so the image quality was kept in tact. this plus other minor obstacles basically caused us to break even at best. Each of us had jobs, so we could not spend a lot of time showing our wares to vendors who would sell T-shirts. In all, it was a great learning experience. You should always try to pull out the things you have learned from your past experiences. The key is not only to try your hand in business, but to pay attention and grow from the experience regardless of win or lose. Because I tried my hand at the little shirt business and subsequently closed shop, I was much better than the average fellow who just plugs along day in day out at his job. Now with more tricks in my bag and a bigger business brain I was ready to move into the next adventure. More to come.

Education can be key

I am reminded, as I stroll through the local Barnes&Noble, that educating yourself is one of those valuable tools I eluded to in my last post. It is a fact that rings true in almost every aspect of our lives, especially in business. It is one of the biggest reasons you hear stories about the millionaires who never finished high school. Now, I am in no way promoting anyone to drop out of school. I just want to illustrate the difference between school and education. Just because a person went to school does not mean they are educated in a way that will make him or her financially successful. It is the content of the education that makes the difference. There are many books written on the topic of finance and business. Many can be found free in the library. If you are just starting out, it will do you well to start reading up on the thing you are after. Until next post...

Tuesday, December 22, 2009

In the beginning, there was light.... bulb.

My very first introduction into the world of independant financial success was AMWAY. Don't worry... I'm not going try to convert you. Hahaha. I was in AMWAY for about a year. I learned a lot of things, but found that it really wasn't my cup of tea. I'm not saying they are a good or a bad company. I was just not able to get with the program and I didn't feel comfortable with their ways. Now, a lot of regular-Joe type people have become millionaires in that business. It is a huge business. In my opinion, it is one of the biggest reasons people are scared away by network marketers even if the network marketer is not selling AMWAY. If I'm not mistaken, the tools and tactics used by many network marketing companies were largely pioneered by AMWAY.

I mentioned before that I learned a lot of things from being in AMWAY. Many of those things are not AMWAY specific. They are the basis for most businesses and for most people who are successful in business. After I quit AMWAY, those things that I learned stuck with me and reverberated in my head. The one thing that stood out from the others was, "You will never get rich working for someone else". I'm sure you have heard that many times. If this is somehow the first time you have read it, be sure to burn it into your head because it is true. We are taught to be poor and broke from day one. This thought was my lightbulb. It started my gears spinning and lead me to many more interesting things that successful people know and live by. To be in business for yourself is to set yourself free. Now, of course, you and I both know that is easier said than done. Some of the pains of that part of my journey will be unfolded as I continue to blog, but I wanted the main message of this post to be that you will never be free working for someone else. I don't care what the salary is. The even sadder truth is that it is harder for someone making a lot of money working for someone else to break free. People who are poor and broke and desparate are more willing to take a chance and try something new especially if it has the slightest notion of getting them to a better place in life. When a person is doing pretty good or is living among the wealthiest of the middle-class, it is very very hard to take a chance. This has been one of my own biggest hurdles. I started what has now turned out to be my life's carreer so far at age 20. Much valuable time has been lost on being too comfortable to take a chance. Try to always keep in mind what is truly valuable in your life and it will make it easier to take those chances and not waste time.

until the next post...

The Journey Begins...

And so, here begins a journey. I will be posting various types of things here. I want to try to outline and describe what I have learned and experienced on my way towards achieving some sort of financial success. On the way I am sure other topics will arise. I will also be sharing some of the opportunities I have taken part in. My big goal is to hopefully leave a path that others can learn from and benefit from.

With that, I will just say, stay tuned. There is more to come and if you have any questions or want to run something by me, please feel free to leave a comment and I will try my best to respond to you as soon as possible.