Startup entrepreneurs of often let a lack of money hold them back. Today, we’ll share 3 ways to get started when you don’t have enough money.
Click the player to listen to this episode of The BIGG Success Show Podcast. Below is a summary of our discussion.
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Asking better money questions is one of the keys to getting the future you want, says Veronica Karas, author of the new book, Money Matters: Everything You Should Have Learned in School but Didn’t.
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On The BIGG Success Show today, we talk with Veronica Karas, CFP, about her new book, Money Matters: Everything You Should Have Learned in School, but Didn’t*. Here’s a summary of that discussion…
BIGG success is life on your own terms. Money is one of the five elements of BIGG success.
When you look at the essence of money, you realize that it comes from only two sources.
Money for time
Time is another one of the five elements of BIGG success. You can trade your time for money.
This is the first source of money. For millions upon millions of people, it is the only source of money.
For the most part, these people will never get ahead. In fact, they will probably end up worse off than they are now.
Once they are unable to trade time for a paycheck, they will be destined to scrape by for the rest of their lives.
Money from money
Your money will work for you if you let it. When you save and invest, you make money on your money.
This is the second source of money. It’s how most wealthy people got rich.
Every human being has the same 24 hours a day. So the only way to get ahead is to get your money working for you.
The starting point of riches
How do you get money to go to work for you?
You must understand this concept:
What you make matters much less than what you keep.
You can’t always control your earnings. However, you are in full control of your spending.
The key to getting started on the road to riches is saving money, month after month. It leads to BIGG success!
Image in this post from money 1
Bigg success is life on your own terms. One of the five elements of bigg success is money. We need to plan ahead so we have enough money to live our golden years on our own terms once we no longer work, another one of the five elements. Otherwise, it’s hard to imagine our golden years being golden.
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There’s at least one silver lining (boy, we’re hitting all the precious metals today) in the dark cloud we’ve been experiencing with the economy – we’re saving money again! It’s not easy to save money, but many of us have realized how important it is to have a reserve.
Financial planners say we should save at least ten percent of our income to put toward retirement. We’ve even heard some recommend twelve percent.
A lot of us face a bigg challenge in socking away that amount of money. Some people may get discouraged because they can’t come close to saving ten percent. So they just don’t save at all.
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I can relate to that because I’m somewhat of an all or nothing guy. But as my dad used to say, “Fifty percent of something is better than a hundred percent of nothing!”
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And nothing is what we end up with if we don’t stash some away now! But there’s no need to get discouraged if you’re not saving all that financial planners recommend.
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Let’s consider a hypothetical couple that has a household income of $100,000. They should save $10,000 according to the experts, but they’re only able to save $3,000.
However, they are determined to find a way to get to that ten percent. They decide that, one way or another, they will make an extra $2,000 every year, year after year, for the next five years. So they plan to make $102,000 next year, $104,000 the following year and so on. This may come from pay raises, bonuses, or a part-time job or business.
Let’s assume that they’re able to invest all of this extra money in a tax-deductible retirement account so they don’t have to pay any taxes on this income now. They also keep investing the $3,000 base they started from.
By the fifth year, our hypothetical couple is making $108,000 and saving $11,000. So they’re now actually saving a little more than financial planners recommend and they did it relatively pain-free!
In this simple example is a secret that can help you with all your goals, not just your financial ones. Bigg success is life on your own terms. If you think about “terms” as time frames, you can reach bigg success faster.
We’ve said that you are the entrepreneur of a very important enterprise – your life. You may or may not be an entrepreneur in the traditional sense of the word. That’s immaterial. What’s important is that we can learn a lesson from successful entrepreneurs, particularly those who work with outside financiers like venture capitalists.
An entrepreneur and a venture capitalist come to terms and strike a deal. The venture capitalist will invest a large amount of money in an entrepreneur’s company. However, the entrepreneur only gets a certain amount of it upfront. He or she must complete some agreed upon action – for example, get a customer – by a certain time to insure the venture capitalist puts in more money. These agreed upon actions with a deadline are called milestones.
As the entrepreneurs of our own lives, we think it’s helpful to set milestones in all areas of our lives.
Think about your bigg goal.
Then carve it up into milestones – specific activities you will complete by a certain time.
By breaking your bigg goal into little actions with deadlines, you can achieve things that you would think were impossible otherwise.
You can measure your progress each step of the way. You can take corrective action if you’re off the mark. Or if you’re ahead of schedule, you can celebrate your bigg success!
Tell us how you do it by leaving a comment below, calling us at 877.988.BIGG or sending us an e-mail at bigginfo@biggsuccess.com.
Thanks so much for reading our post today!
Please join us next time as we build on this subject of milestones. We’ll talk about creating a cumulative advantage.
Until then, here’s to your bigg success!
Direct link to The Bigg Success Show audio file:
http://media.libsyn.com/media/biggsuccess/00371-041309.mp3
CNN Money recently asked forty people for the best advice they ever got about money. One of the people featured is Bill Nygren, the great manager of the Oakmark Select Fund.
He refers to an episode of the Johnny Carson show, where Johnny asked financial guru Andrew Tobias how someone with only $1,000 should invest it. Andrew Tobias said they should buy non-perishable items.
The crowd got quite a kick out of that answer!
Here was this great financial mind suggesting that people, with only a small amount of money, buy common, every day items instead of investing it.
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