Finances: How to Get Rich – The Formula (4 Steps) – Understanding Money

Do you want to know how to get rich? Guess what, it is possible for anyone and you can be rich too you just have to understand how money works.

As long as you can learn how money works, you will be on your way to accumulating massive wealth.

So without further ado, here 4 steps to becoming rich.

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1. Create Streams of Income

The saying is true: “to make money you’ve got to have money,” and this applies here. If you have not been lucky enough to be born into wealth and you were born a millionaire then most likely this step means that you have to get a job.

 

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At the very beginning stages it is important to start generating some money that you can later use it to do more advanced things such as investing in to a business and investing to make your money work for you.

2. Create More Assets Than Liabilities

Owning your own assets is an integral part to becoming rich. However, most people spend a majority of their lives accumulating liabilities which is bad.

So, you may be asking what is the difference?

Here are their respective definitions:

An asset something that you OWN that can be either sold for cash, or pays you steady income on a fixed schedule. Examples of this include: real estate, a car (that you OWN), jewelry, stocks, bonds, or artwork.

A liability  is debt that you are responsible for paying back to someone. Some examples include: mortgages, car payment, credit card payments, or money you owe to a friend.

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With that being said, most people in society sign up for too many liabilities and it is the reason why the majority of people on the planet, struggle financially; and it’s because most people sign up for liabilities.

Credit card companies and banks understand that most people want things that they cannot afford; They also understand that most people will NOT be able to pay them back. This is why they charge interest, and they are collecting HUGE profits using this strategy!

Now, it is up to you to take the power back into your own hands. Stop being the consumer  and piling boat loads of debt and focus on owning your own assets. You see, every time you sign up for a liability that is more money that comes out of your pocket which gives you less money that you can invest and grow. Essentially, having liabilities leaves you stuck, which is where most of society is-stuck in DEBT.

To become rich and avoid being like everyone else, avoid accumulating liabilities and eliminate the ones that you already have. Unless you are investing in a product that will help your business grow or something along these lines, do not use your credit and live a frugal lifestyle below your means so that you can accumulate money to invest in a business.

Stick to this rule: If You Can’t Afford Something With Cash, You Cannot Afford It. Credit is the BANKS money. So don’t buy it and fall in the debt trap! 

3. Start Your Own Business

Now that you have gotten out of debt and have covered your basic needs with your sources of income. Now it is time to use that money to feed your business. At the core, this is important to do because it gives you protection against one of your income sources failing. Plus, there is no better way to make a lot of money than with your own business—the sky is the limit. Also, if you lose a job, or one of the markets that you invest in goes sour you will always have your business to fall back on.

Here are 2 basic ideas:

An Online Business this is a business that primarily operates virtually and it is the hottest market right now. Billions of dollars are moving in to this market. You can provide coaching, services, sell books, sell programs, you can make passive income from a blog, YouTube, etc. Really the options are limitless there are sooo many ways to make money online.

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Sell Products Nothing like selling hard products. There are many different kinds of ways to do this. There’s the old school way of opening up a brick and mortar store and selling a product to people that way, but the downside is that it is expensive (rent, electricity, etc) or you can start a business on amazon and sell directly to consumers that way.

These are just a two basic type of businesses, but there are THOUSANDS of others that I have not mentioned here. Find something that you are passionate about and create your business around that passion.

4. Become an Investor

Now that your business is growing and you have some significant income being generated, now it is time to go all in with your investing. Take sums of money and distribute them towards different types of investing. This is called diversifying.

The reason you want to diversify your investments is because at any given time one of them can fail. For example with a stock, the company could go out of business or with real estate a hurricane can destroy your property.

Here Are Some Different Types of Investments:

Stocks/Bonds/Forex Market these are the basic markets that allow you to invest in companies and currencies. Some are risky but have high payouts and some are safe with low payouts. Have investments in both. These investments will pay you consistently over the life of their life and pay you dividends, coupons, and capital gains that will boost your bottom line nicely over time and grow your wealth.

Stock Market Diagram

Real Estate this is when you are investing in land or a structure such as a house or building. The nice thing about this is that once you have tenants living in your property, you will be getting consistent rent checks monthly. Also, real estate is GREAT for making PROFIT. If you chose, buy a property and fix it up and then sell it for more money. Many people make a killing doing this.

Hard Assets these are assets such as jewelry, cars, and artwork. Literally, there are so many things that you can buy that have great value to others and that will appreciate in value over time which you can then sell for a profit. Another great source of investing.

With that being said, again, these are just a FEW types of investments that one can make. People who are wealthy, are at this stage—investing. Once you have the power to invest, you don’t have to work anymore because your money literally works FOR YOU.

Conclusion

As long as you follow these steps and keep these principles in mind, you will be rich in no time. The key is, once you have established your own business and have investments lined up, you will be down the right path of accumulating massive wealth.

How to MASTER Your Business, Finances, and Health

To achieve great things you must master these 3 things: your business/career, your finances, and your health. Commit to mastering these and I promise your entire life will change. You will have a distinct advantage over your competition.

In this post, I will show you how to master your business/career, finances, and health.

What Is Mastery

Mastery is a commitment to get rid of old habits in your life and to take massive action to ingrain better habits. Put 100% effort into improving every aspect of your life. All it takes is patience, faith, and perseverance and slowly but surely you will find the abundance you desire.

Master Your Business

To achieve great success in business you have to rise to the cream of the crop. The top CEO’s in the world all dominate. Bill Gates (Microsoft), Mark Zukerberg (Facebook), and Jeff Bezos (Amazon) all crush their competition, it’s not even close. This is what you have to do, go all in and smoke everyone else.

Here Are 3 Steps To Mastering Your Business

1. Knowledge

Stand out from the crowd, seek and obtain knowledge. Become a master of your craft. Learn how to be the best salesman. Observe the habits of the most successful people in your industry and emulate them. With more knowledge you will be a reliable resource for your customers and avoid the mistakes other entrepreneurs make.

Here are some books that will help you: “How To Win Friends & Influence People,” by Dale Carnegie, “The Habits of Highly Effective People”  by Stephen R. Covey, “Think and Grow Rich” by Napoleon Hill, and “The Art of The Deal” by Donald Trump.

2. Be Transparent  

The most successful people are very transparent. Potential customers like to know who they are doing business with and Twitter, Facebook, and Snapchat make it possible. If your business doesn’t have a social media presence, you are always at a disadvantage against competitors that leverage this asset. Not only is it important to have a social media presence, but you must dominate the space. Seek to outproduce and outperform any competitor out there and blow them out of the water. This will put you on top.

3. Be A Good Person and Be Genuine

Be a likable person. People can tell when you aren’t genuine and don’t care. Put the needs of your customers before yourself and it will do wonders for your business. It’s not good to not have respect for people. Go above and beyond for your customers in ways that your competitors don’t and you will dominate your business space by providing value.

Master Your Finances

As a former financial professional, I can attest that many people have no idea how money works. Become a master with your money. Even if you are broke and starting with nothing, take time to learn about the different investment vehicles, functions of money, and how to create passive income streams. Make money work for you.

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Understand How Money Works 

One of the first things we are taught is to work for money. This is not entirely true because money can actually work for you. Many people have only one source of income. This not good because when they lose that source of income they are broke. The key is to create several streams of income. The more money you can make the more money you’ll have to put to work for you. Then, one day you can make money while sitting on a beach.

Here are 2 steps to Make Money Work for you:

1. Generate Streams of Income

Develop more than one income streams and then diversify them. If you have no income, you can’t survive or make more money. So first get a stream of income (for example: a job). Then find other ways to make more income. Some examples are, getting a second job, start a business, sell a product, or sell a service. Nowadays you can start a business online for free, so this is an option. Your end goal should be to be able to pay bills and still have savings remaining.

2. Make Investments and Generate Passive Income 

Once you have savings start to invest your money. Some good investments to make are in the stock market, bond market, real estate, foreign exchange, and hard assets that appreciate in value. Don’t put all your marbles in one basket, aim to invest in as many different places as possible. By diversifying you will be protected by the income of your other investments in case one of these sectors performs poorly (example: stock market crashes). As you generate passive income from your investments, you’ll be making money without having to work.

Mastering Your Money Conclusion

Eventually you should be generating enough passive income to quit your job if you chose. This way you can focus on your own business. If you love your job, that’s fine, but you will be comfortable knowing that your passive income streams give you more options.

Master Your Health

I get it, life is hectic and we have jobs, relationships, and kids to worry about; but I can’t begin to tell you how imperative it is to MAKE time for our health. Take the time to eat healthier and work out. It will make a huge difference in your life.

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Adopt Healthy Eating Habits

The average diet consists of pizza, white bread, fruit juices, cookies, french fries, and processed meat. These foods contain high amounts of sugar, unhealthy fats, sodium (salt) and carbohydrates. Consuming too much food is scientifically proven to cause heart attacks, cardiovascular, problems, diabetes, and even cancer. Food is fuel to the body. When we fill our bodies with bad fuel, we set ourselves up for failure.

Replace junk food with fruits, vegetables, whole grain foods, and unprocessed organic meats. You will see a huge spike in energy and mood. Eating healthier has been proven scientifically to make skin healthier. This will enhance those good looks ;).

Go To The Gym

You don’t have to be a body builder but make the time to go for a run. Do some weightlifting. Going to gym and jogging at least 3 times a week is sufficient to good health and physique.

There are many places to learn about working out on the internet. A good book that will help you is Muscle & Strength by Jim Stoppani or for a free alternative, check out SixPack Shortcuts on YouTube. They have workouts that are good for people on all levels.

Conclusion 

If you master these things, you will reap massive success on this planet. All it takes is a commitment and nothing will stop you.

Hope this helps. Be great.

Cheers,

Nigel