Sunday, January 31, 2016

3 Money Habits That Separate the Rich From the Poor
Written by Jim Rohn

It all starts with the same amount of money—just a different philosophy.

Here is an exciting thought! Why not work full time on your job and part time on your fortune? And what a feeling you'll have when you can honestly say, "I'm working to become wealthy. I'm not just working to pay my bills." When you have a wealth plan, you'll be so motivated that you'll have a hard time going to bed at night.

So if you will indulge me, I would like to share a simple formula for creating wealth. Here’s my thought on how money should be allocated.

The 70/30 Rule

After you pay your fair share of taxes, learn to live on 70 percent of your after-tax income. These are the necessities and luxuries you spend money on. Then, it’s important to look at how you allocate your remaining 30 percent. Let's allocate it in the following ways:

Charity

Of the 30 percent not spent, one-third should go to charity. Charity is the act of giving back to the community and helping those who need assistance. I believe that contributing 10 percent of your after-tax income is a good amount to strive for.

The act of giving should be taught early, when the amounts are small. It's pretty easy to take a dime out of a dollar. But it's considerably harder to give away a $100,000 out of $1 million. You say, "Oh, if I had $1 million, I'd have no trouble giving $100,000." I'm not so sure. $100,000 is a lot of money. Start early so you'll develop the habit before the big money comes your way.

Capital Investment

With the next 10 percent of your after-tax income, you're going to create wealth. This is money you'll use to buy, fix, manufacture or sell. The key is to engage in commerce, even if only on a part-time basis.

So how do you go about creating wealth? There are lots of ways. Let your imagination roam. Take a close look at those skills you developed at work or through your hobbies; you may be able to convert these into a profitable enterprise.

In addition, you can also learn to buy a product at wholesale and sell it for retail. Or you can purchase a piece of property and improve it. Use this 10 percent to purchase your equipment, products or equity—and get started. There is no telling what genius is inside you waiting to be awakened by the spark of opportunity.

Savings

The last 10 percent should be put in savings. I consider this to be one of the most exciting parts of your wealth plan because it can offer you peace of mind by preparing you for the “winters" of life. Let me give you the definition of "rich" and "poor”: Poor people spend their money and save what's left. Rich people save their money and spend what's left.

Twenty years ago, two people each earned a $1,000 a month and they each earned the same increases over the years. One had the philosophy of spending money and saving what's left; the other had the philosophy of saving first and spending what's left. Today, if you knew both, you'd call one poor and the other wealthy.

So, remember that giving, investing and saving, like any form of discipline, has a subtle effect. At the end of the day, the week, the month, the results are hardly noticeable. But let five years lapse and the differences become pronounced. At the end of 10 years, the differences are dramatic.

And it all starts with the same amount of money—just a different philosophy.

Jim Rohn, America's Foremost Business Philosopher, reprinted with permission from Jim Rohn International © 2016. As a world-renowned author and success expert, Jim Rohn touched millions of lives during his 46-year career as a motivational speaker and messenger of positive life change. For more information on Jim and his popular personal achievement resources or to subscribe to the weekly Jim Rohn Newsletter, visit www.JimRohn.com.

Sunday, January 24, 2016

If You Change Yourself, You Can Change Your Life
Written by Jim Rohn

You cannot change the circumstances. But you can get stronger, wiser, better.

Life is about constant, predictable patterns of change, and the only constant factor will be our feelings and attitudes toward life. We as human beings have the power of attitude and that attitude determines choice, and choice determines results. All that we are and all that we can become has indeed been left to us to decide and interpret through our attitude and choices.

Life is like the changing seasons—you cannot change the seasons, but you can change yourself. So the first major lesson in life to learn is how to handle the winters. They come regularly, right after autumn. Some are long, some are short, some are difficult, some are easy, but they always come right after autumn. That is never going to change.

There are all kinds of winters: the "winter" when you can't figure it out, the "winter" when everything seems to go awry. There are economic winters, social winters and personal winters.

Wintertime can bring disappointment, and disappointment is common to all of us. So you must learn how to handle the winters. You must learn how to handle difficulty; it always comes after opportunity. That is never going to change.

The big question is what to do about winters. You can't get rid of January simply by tearing it off the calendar. But here is what you can do: You can get stronger; you can get wiser; you can get better. Remember that trio of words: stronger, wiser, better. The winters won't change, but you can.

Before I understood this, I used to wish for summer when it was winter. When things were difficult, I wished they were easy. I didn't know any better. Then my mentor Earl Shoaff gave me the answer from a part of his unique philosophy when he said, "Don't wish it were easier, wish you were better. Don't wish for fewer problems, wish for more skills. Don't wish for less challenge, wish for more wisdom."

Jim Rohn, America's Foremost Business Philosopher, reprinted with permission from Jim Rohn International © 2015. As a world-renowned author and success expert, Jim Rohn touched millions of lives during his 46-year career as a motivational speaker and messenger of positive life change. For more information on Jim and his popular personal achievement resources or to subscribe to the weekly Jim Rohn Newsletter, visit www.JimRohn.com.

Sunday, January 17, 2016

Why You Should Run Your Life More Like a Business

When you have good money habits, you spend less than you make and then you save and invest the difference. Over time, your saving grows and compounds. Those who dutifully live below their means for much of their lives are able to accumulate significant amounts of wealth. Some are even able to accumulate millions. And as the saying goes, “Every million in retirement counts.”

One thing you may want to do is you may want to increase your income. By starting a business of your own, you can increase your income in a way that will allow you to save much more money in a shorter period of time and get you where you want to go much quicker. It also allows you pay off debt quicker. Let’s face it almost everybody has too much debt.

For example, let’s say you took 50% of the additional money that you make with your business, above and beyond what you are making at your job, and you use that money to pay down and eradicate your debt. Then you take the other 50% and use it to save and invest. Also, let’s say that you don’t start buying new cars and stuff with all of that additional income – which is what most people do – because that would be a poor money habit.

So, if you started a part-time business, you could start making an extra $1000 or $2000 a month or even more. So, with $2000 you can take $1000 and start paying down those credit cards, your car payments or whatever. And with that other $1000, you could start investing that money. And if you keep growing your income and growing your business, and you start paying down your debt, you are going to end up freeing up more money. So, those credit card bills or those car payment bills, if you start using that freed up money, you can either more aggressively pay down your debt or take that additional savings you freed by paying down your debt and - let’s say now you have an additional $200 a month - if you take $100 of that and put it towards debt, you could take the other $100 and put it towards your saving and investments. You keep doing that over a year or two or five or ten or fifteen and boy, you can’t even imagine how much better your situation is going to be.

It's important to know however that whether you have a job or have a business, the amount of money you actually make is the money that you’ve saved and invested - and that you still have - after paying your living expenses, your business expenses and your taxes. That money that is left over is actually what you made that year. So, if you are looking to invest in a company, you would look at what they show as their net profit after paying their employees, after paying all expenses, whatever expenses are related to that business. The money that they make after paying taxes and paying all of their expenses is actually what that company made that year. It’s not the gross. The gross means nothing. The gross of your income means zero. The only thing that matters is the net.

So, if you are spending everything that you are making, you are not saving and investing any money, and therefore, you are not making any money. What you shoud do is look at yourself like you are a business. And if you are not saving any money, it means you are not making any money. Think of it this way - let's say YOU are a business that people are going to invest their money in - if you weren't saving any money, nobody would invest in you. They would never do it because there is no income. The company’s not making any money. So, percentage-wise, what you want to do is get to the point where your business is highly profitable, which means your money that you save after taxes and expenses is significant. Just like a business, that’s what you really should focus on.

If you say, “I make $100,000 a year,” my question to you is, “How much did you save out of that money?” Let’s say you saved $10,000 a year, or 10%. That is actually what you made - $10,000 that year. You didn’t make $100,000 because that money is all gone. It’s gone to expenses, it’s gone to taxes. So, you didn’t make that money. It isn’t even yours. You gave it to somebody else. You either gave it to the government or you gave it to your debtors. So, you didn’t really make $100,000.

Even if you make $1 million a year, after you pay taxes. Taxes are going to be at least 30% after deductions,so that’s $300,000 gone. And when most people start making money they start buying a big house, a big car, they start spending money like crazy. Let’s say the overhead on your living expenses is another $30,000 a month or more. That’s another $300,000 gone. And then there are probably other expenses as well. So, really you might have, after everything is said and done, $200,000 or $300,000 – That’s what you made. You didn’t make $1 million.

So, even when you are making big money, you still have to think like a business person. What is the net? The only thing that matters is the net, not the gross. The gross means nothing. You need to start thinking like that in your personal life, even if you have a job, even if you don’t have a business, you need to think that way. It’s always about the net.

If you get in the habit of thinking more in terms of “net worth” instead of “yearly income” then you will be well on your way to running your life more like a business - hopefully a profitable business.

I'm so excited to share this information with you. If you have enjoyed the information or feel that it would benefit someone else, please share it. If you have any comments, please post them below, otherwise, feel free to contact me.

Thursday, January 7, 2016

The Qualities of Enterprising People
Written by Jim Rohn

To be enterprising is to keep your eyes open and your mind active.

An enterprising person is one who comes across a pile of scrap metal and sees the making of a wonderful sculpture. An enterprising person is one who drives through an old decrepit part of town and sees a new housing development. An enterprising person is one who sees opportunity in all areas of life.

To be enterprising is to keep your eyes open and your mind active. To be skilled enough, confident enough, creative enough and disciplined enough to seize opportunities when they present themselves. A person with an enterprising attitude says, "Find out what you can do before taking action." Do your homework. Do the research. Be prepared. Be resourceful. Do all you can in preparation of what's to come.

Enterprising people always see the future in the present. Enterprising people always find a way to take advantage of a situation, not be burdened by it. And enterprising people aren't lazy. They don't wait for opportunities to come to them—they go after the opportunities. Enterprise means always finding a way to keep yourself actively working toward your ambition.

You need two things to be enterprising:

1. Creativity—to see what's out there and to shape it to your advantage. You need creativity to look at the world a little differently. You need creativity to take a different approach—to be different.

2. Courage—to be creative. You need courage to see things differently, courage to go against the crowd, courage to take a different approach, courage to stand alone if you have to, courage to choose activity over inactivity.

Being enterprising doesn't just relate to the ability to make money. Being enterprising also means feeling good enough about yourself, having enough self-worth to seek advantages and opportunities that will make a difference in your future. By doing so, you will increase your confidence, your courage, your creativity and your self-worth–your enterprising nature.

Jim Rohn, America's Foremost Business Philosopher, reprinted with permission from Jim Rohn International © 2016. As a world-renowned author and success expert, Jim Rohn touched millions of lives during his 46-year career as a motivational speaker and messenger of positive life change. For more information on Jim and his popular personal achievement resources or to subscribe to the weekly Jim Rohn Newsletter, visit www.JimRohn.com.