Posts

Making Money Multiply Magically

magic moneyWe often romanticize about what life would be like with more money. We may think we would have more leisure time. We may picture ourselves spending some of that time in front of our new plasma TV. We may assume we would be happier.

___

___

But then the reality kicks in.

Research shows that we tend to quickly spend our new found cash. It also shows that new material possessions make us happier for a very short period of time.

More importantly, we make an incorrect assumption about what it takes to make more money. We often have to spend more time working and commuting. So we actually have less leisure time.

We end up in the rat race.

We work more to make more money. Then we spend more money so we have to work more to make yet more money. Then we spend more so we have to work more and on and on.

There are two lessons here for us:

  • Be careful how you define bigg success. If it means more money, understand that there is a price. You’ll almost certainly have to invest more time.
  • Our definition for bigg success is life on your own terms. For you, that may mean more money. But it may not. We focus so much in our society on money. It’s important to remember that money is the means to an end, not the end itself.

The funny thing is that you often end up with more money when it’s not the center of your focus. Here are four ways to make your money multiply magically:

Focus on your whole life.

Find work that you love. Take up a hobby if you don’t have one already. Build strong relationships personally and professionally. You’ll find that it often doesn’t take much money to spend your time doing the things you love with the people you love.

So your money will multiply magically!

Spend less than you make.

Sounds pretty simple, doesn’t it? But we all know that it isn’t. It isn’t simple but it is necessary.

Don’t fall into the trap of thinking life would suddenly be much better if you just made more money. Make the best of the money you make now and your money will magically multiply.

Avoid consumer debt.

If you have it now, pay it off aggressively. Get used to paying for purchases with cash. This is a timeless principle that applies to all economies and all people. We’ve recently relearned this lesson.

Here’s a question to ask anytime you’re tempted to buys something with borrowed money:

“If I can’t afford it today, what makes me think I can afford it, with interest, tomorrow?”

Many people assume they will make more money in the future. They don’t factor in that their costs will likely be higher in the future. That’s how they end up in the rat race and debt just compounds it.

Note that we didn’t say avoid all debt. It may make sense to borrow money for a legitimate investment. You have to prove out the opportunity, but a lot of people have made their money multiply magically by using leverage.

Invest wisely.

As we learned last year, stocks don’t go up forever. As we’re seeing this year, they don’t go down forever either. So invest in a diversified portfolio of assets. One of the best ways to do this is through no-load mutual funds as part of a qualified retirement plan.

Don’t let your money control you. Control your money and watch it multiply magically! That’s bigg success!

___

Get the tips and tools you need to be a BIGG success.
Subscribe to the Bigg Success Weekly – it’s FREE!

___

Thank you so much for checking in with us today. Please join us next time when we’ll look at the first win entrepreneurs must achieve. Until then, here’s to your bigg success!

Subscribe to The Bigg Success Show in iTunes. 

Subscribe to the Bigg Success feed.

Direct link to The Bigg Success Show audio file:
http://media.libsyn.com/media/biggsuccess/00476-090709.mp3

Related posts

The Best Present of All, No Matter How It's Wrapped

Want to be a Millionaire? Here's How to Think Like One

[cref 1920]

From Refund to Riches: How to Turn a $2,300 Refund into $723,000!

With tax day upon us here in the United States, a lot of people will get a refund soon. So today, we’ll discuss how to turn that refund into riches.

But this blog is really about “found” money – money you weren’t expecting. The average refund last year (paid in 2007 from 2006 tax returns) was $2,287, according to the IRS.

That’s a nice down payment on a plasma TV!

That’s what a lot of people do – spend their refunds on things that won’t be worth much in a few years.

Instead of that, you could save and invest it. But isn’t that’s boring?

Boring can be exciting when your money starts to compound!

How to turn your $2,300 refund into $643,000!

Say you’re 25 years old and you get a $2,300 refund every year until you retire at 65. We’ll assume that you earn 8% on that money, which may be a little conservative depending on what you invest in.

Under these assumptions, that $2,300 a year invested will turn into a nest egg of over $643,000 when you retire!

Now is that boring?

Age makes a difference. Take the previous example for a 35-year old. Your nest egg is still significant – it’s over $281,000. But by waiting just ten years to start, it will be less than half as much!

But even then, you still create a nest egg of nearly $300,000.

2 ways it can be even better

#1 – Quit loaning the government money at 0%.
That’s what you’re doing when you get a refund – you’re getting your money back, but you don’t earn any interest on it while they hold it. So redo your W-4 so you only withhold what you expect to owe.

Then you won’t get a refund, but you’ll have more money in every paycheck. But here’s the key:

You have to be disciplined enough to invest that money!

Let’s say you do that – Invest your refund check this year, adjust your W-4, and then invest the extra money that shows up in your paycheck. You’re that 25-year old we talked about earlier. Only now …

… you’ll have over $723,000, instead of $643,000. It makes an $80,000 difference!

Doesn’t that open your eyes about the “cost” of a refund?

#2 – Pay off debt that’s costing you more than 8%.

We assumed an 8% return. If you have any debt that’s costing you more than 8%, pay it off first and your returns will be even higher! Once your debt is paid off, start investing to build your nest egg.

Jake’s Take – Top 5 signs that you hired the wrong accountant

#5 – He insists on filling out your return using only Roman Numerals.

#4 – He offers to help you boost your deductions by renting you his wife and kids.

#3 – He spends most of your consultation looking nervous and asking if you're wearing a wire.
 
#2 – He does all his calculations on an Etch-a-Sketch.
 
#1 – His client list includes Leona Helmsley, John Gotti, and the Unibomber.

Our bigg quote today is a Proverb.

“Money grows on the tree of patience.”

So do you want to watch your new plasma TV or do you want to watch your money grow? The choice is yours!

Click on our Comment link below to share your thoughts 
Click on the Share This button below to Digg, Stumble, Mixx, etc.

Next time, we’ll discuss why being imperfect is perfect. Until then, here’s to your bigg success! 

Subscribe to the Bigg Success feed.

Subscribe to The Bigg Success Show in iTunes. 

Related posts 

6 Easy Steps To Financial Freedom

This Little Piggy Bank

Review: The Richest Man In Babylon

The Illusion Of Wealth

Don’t Make This Costly Mistake

Getting Aggressively Passive: Creating A Passive Income That Sets You Free

(Image by gossamerLL)