The lack of knowledge about money is the cause of most people’s financial problems. So many of us have so much false information regarding money, finance, budgets, debt and income that it is no wonder that most people never accumulate much wealth.
The 3 fundamentals of money
I know people who won’t buy anything if it isn’t on sale, yet who are still broke because they don’t understand how to produce income.
They spend their entire life thinking money is scarce, when in reality, it’s merely a currency printed by man. I also know people who know how to produce income but never learn how to manage it and end up with none of it.
While most of us believe that money isn’t the only element of happiness, we know that it’s necessary to maintain a comfortable life.
You need to understand the basic building blocks of money. This is not an exhaustive list, but here are 3 building blocks you need to have:
1. Meet weekly on your money.
Out of sight is out of mind.
That’s why every week I, my wife, and my kids meet on money.
Why do I want to pay attention to my money? You live on an economic planet.
Whatever your race or religion, you live on an economic planet. Somebody is going to ask you for money today. Something is going to cost something.
If you’re not paying attention to it, if you’re not confronting it, then don’t expect to have it. In your meeting ask how you did this week, this month, how much money is in the accounts, what did we spend the money on?
Remember to spend 95 percent of your time on income and only 5 percent should be on expenses.
Put your attention on what you want.
Money loves attention.
Money never sleeps, and it gets bored.
Money is jealous, so if you don’t pay attention to it it’s going to live with someone else.
2. Stay broke.
Some of you are doing this without trying, but when you focus on your income and bringing it up in increments — say $10K to $15K — save 40 percent of it and be broke.
Put 40 percent of your income into a sacred account where you can’t touch it. Every time you get new money, put it into the sacred account.
Why would you want to stay broke?
Because when you’re broke you hustle.
When you don’t have money you have got to knock on a door.
When you have a cushion, you go soft.
When there is a cushion of money lying around, you’ll find an emergency to put that money to.
Money hates to be ignored, so when it gets bored it goes to play. Stay broke.
3. Become a pro.
A basic building block of money is to get you in a position to quit worrying about money.
If you’re worried about money, it’s an indication that you are off-track.
My sister got an education, showed up to early to work hard, did the right things and saved her money. It didn’t matter how much money my sister saved — no matter how much she put away, she was always worried about money.
We are brought up worrying about money. Anything that you are not sure about or competent about, you’ll get worried about.
You cannot afford to be an amateur when it comes to money.
The worry of money indicates that you are an amateur. Amateurs have no plan, don’t pay attention, don’t know what they are doing and have not made it a priority.
There is no shortage of money, you just need to understand how to get it. Worry is an indication that you are on the wrong side of the game.
I challenge you, starting today, to meet weekly about your money, learn to stay broke no matter how much you increase your income and set a target of saving 40 percent.
Learn to stop worrying about money by becoming a pro — not an amateur. If you have dreams of getting rich, becoming a millionaire and having financial freedom in your life to do what you want to do when you want to do it, get my Millionaire Booklet today. It has already been translated into Spanish, French, Danish and Bulgarian, with 40 more languages to come because I want to make millionaires around the world.
Have you applied these principles to your financial planning? Let me know in the comments’ section below.