Today's society has produced an astounding number of people who live by the entitlement standard. Our social services and welfare programs practice the "give a man a fish" method of solving problems rather than the "teach a man to fish" method. As a result the gap between the lower/middle class and the upper class or the "haves and have-nots" is getting exponentially wider as the years go on. Rather than teaching how to get yourself out of a financial rut, our government assistance programs become a trap where the more you try to help yourself, the less help you receive. For the most part, the assistance the people receive is monetary with little or no relevant education.
The problem is not really how much money the people have, but rather a lack of financial education and a lack of desire to make changes or fear of failure.
Poverty is caused by ignorance, and fed by fear and laziness.
We are not taught about money in school, the subject of money is taught at home. Opinions and understanding of money are passed down from generation to generation.
I say that poverty is caused by ignorance because there seems to be this common consensus that money is scarce or hard to get or that the only way to get money is to work hard for it. This point of view is accepted for two reasons; 1) our schools teach us to study hard so that we can get a good job, because with a good job we will be safe and secure and the company will take care of us, 2) we have been lead to believe that when we can not take care of our selves that the government will take care of us ( or more accurately, many of us believe that the government should take care of us). We have the Robin Hood mentality " make the rich pay for it, they can afford it." When people struggle financially, many will place the blame on the economy, business owners, someone, anyone other than themselves. I here people say " if only I had more money." or " I'm looking for a job that pays better." or "my boss is greedy and won't give me anymore money". This is said because the person believes that more money will solve their financial problems, when in reality more money rarely solves the problem because what is really causing the struggle is the person in control of spending the money, because that person is not financially educated. Not because the person is stupid or inferior, but because when it comes to money that person only knows what he/she has been taught by our school system (which is nothing) and at home ( which is to handle money the way that he/she handles money now because that is the only way they know and how it has been done by their family.).
Poverty is created by ignorance, the lack of financial education keeps us repeating the same financial mistakes generation after generation until someone chooses to break the cycle.
Poverty is fed by fear and laziness.
Fear first.
We are taught in school that there is only one right way to do something or one right answer to a question, one right way to solve a problem and if we deviate from that, then we are ridiculed or punished for not following the rules or being different. So we develop this fear that if we do something different and do not accomplish what we set out to do, then we will be a failure and be ridiculed by our peers and other people around us. We are afraid that if we admit that we do not know the answer, other people will think we are stupid because we are taught at school and as employee's that not knowing the answer is a bad thing. In school if we try to collaborate on a test, it is called cheating. In business, collaborating on a test is called synergistic problem solving and the teams get more accomplished than one person could on their own.
After fear is the laziness. It is much easier to not make the effort to learn something new that will help us than to face the fear of rejection or failure. And so the same pattern is repeated over and over again expecting different results , but never getting them because the same behaviour will garnish the same results. I hear things like " I can't do that. or I can't afford it. or I didn't go to the right school for that. or I don't have the time for that, or I don't want to waste the money on learning something new.
We often put our selves in the situation we are in by our choices. Either our choice of action or choice of reaction and rather than taking responsibility for our choices, we blame the economy, our boss, the government, or other persons in our relationships. we choose to discount learning opportunities or other opportunities out of fear or laziness and wonder why we don't seem to get ahead. We use industrial age financial education in the information age where information doubles every eighteen months. We study hard at college learning information in our first two years of school that is out dated by the third an fourth year. College advisers instruct students applying for jobs with information that was accurate 20 years ago but is not necessarily applicable for the student today. We teach our students to regurgitate facts and figures from history, but fail to teach the lessons history has to offer and in doing so create a society that sinks deeper and deeper into ignorance. By our methodology, we teach our students that they must have all of the right answers rather than teaching them to look for multiple, creative solutions to problems. We generally accept complaining about the problem rather than seeking solutions. And then after all of that, we penalize the products of our teaching by creating assistance programs that do not increase intellect but rather force people back into the fear and laziness mode. A person receiving government assistance is penalized by having more and more benefits taken away as that person works harder and harder to make the income that will make it possible for that person to be self reliant rather than relying on the government. These programs create an atmosphere of false security where people say " if I make more money, I will loose my assistance or benefits (I am afraid that if I loose my benefits I will not be able to survive), so it is easier to stay poor and get the hand out, than to create income and not need the benefits (laziness). Our government assistance programs reward lazy and ignorant behaviour by giving young single mothers more money for each child that they produce and added tax credits for poverty level income earners that becomes viewed as a paycheck. I have seen parents with several children come into my office with multiple w-2's totaling less than $12,000.00. These same people tell me that they stop working so that they will receive the maximum Earned Income Tax Credit which produces a larger refund. These people are making less than $12,000 per year before taxes, they don't get to take home 12,000.00 and choose to stop working for a measly 4000.00 addition to their tax refund. I see self employed people who don't take all of their allowed deductions because they want to get the maximum Earned Income Tax Credit, so they pay thousands of dollars more in taxes than they are required to and accept a two thousand dollar refund.
Our schools encourage cheating for students that struggle to learn the way that our schools teach by providing scribes who will write the answers for students who struggle with spelling and readers who read tests to students who struggle with reading so that the grades and standard test scores reach a higher average and the school will not risk loosing funding.
We breed poverty in our society and then tax the poor heavily to pay for the benefits that they receive.
We reward laziness with government benefits, threaten to take away those benefits if the person shows some hint of initiative and fail to educate our students adequately enough to serve them in the real world.
So what do we do about this? We continue to offer the education to those who will accept it, lobby for education reform and teach people to over come their fear of lack of money by showing them the tools available and teaching them how to use those tools. Encourage our children and students to fail on thier own merit in schools and learn from the experience rather than to be pushed through a system that does not prepare them for the real world. Make sure that our children and students are proficient at basic math first, then teach them the advanced math. Teach them to use proper grammer and to communicate effectively. Excellent math and communication skill are essential to our success.
Wednesday, May 23, 2007
Thursday, May 17, 2007
Thursday, May 3, 2007
It's a Matter of Training- Why The Rich Are Getting Richer While The Poor Get Poorer by Dannielle Fritz-MacDuff
One of the reasons that so many of us struggle financially is because we are trained to work hard for money rather than to look for opportunities that will make our money work hard for us.
All through out our academic careers we are trained to get good grades so we can get into a good college and a college education will get us a good job. With a good job we can work for 30 or 40 years and retire with a golden parachute and a pension plan. During most of our adult lives, we are taught to go out and get a job. There is the common consensus that getting a job is the only way to get money. We are trained through out our lives to look for jobs. The problem with this training is that a person's financial potential is limited to the amount of time a person physically works. If the person does not work, the person does not get paid. In addition, when you work for money, you are partnering with the government. With your time, you earn the money and then the government takes thier part before you even see the fruits of your labor. The government's share can be up to 48% just to the federal government when we add in state and local taxes, the government share of your hard earned money can be as much as 60% . It is much harder to get ahead financially when you are working hard and only getting to use 40% of what you have earned.
Our schools, society and ,many times, our families train us to work hard for money. The key to getting off of this financial hamster wheel is to retrain your mind to look for opportunities rather than looking for a job.
Have you ever noticed that when you are looking for a specific type of car, suddenly that car is everywhere? When you are looking for a new home, you begin to see for sale or for rent signs everywhere. When you want a job, you find a job.
If you want more financial control, you have to retrain your brain to look for opportunities that make money for you, with out a lot of time or effort from you rather than looking for a job.
The opportunity of a lifetime comes along about once everyday. If a person takes the time to retrain his/her brain to look for opportunities rather than look for a job, opportunities will begin to pop up everywhere.
I have a challenge for you:
Spend one hour everyday looking for an opportunity. You do not have to spend one hour all at once. Spend 10 minutes looking through the classified adds or driving a different way to drop the kids off at school. Take note of opportunities during your regular routine.
The opportunities that you find will be your opportunities and different from my opportunities. Your opportunities will come a combination of your creativity and what you see.
Then persue those opportunities. Do not let what you see limit your potential.
Forget the idea that there is only one right answer to any given situation. Rather than saying 'I can't do that because I don't have this.' Ask yourself 'How can I do that?'
Happy Hunting.
All through out our academic careers we are trained to get good grades so we can get into a good college and a college education will get us a good job. With a good job we can work for 30 or 40 years and retire with a golden parachute and a pension plan. During most of our adult lives, we are taught to go out and get a job. There is the common consensus that getting a job is the only way to get money. We are trained through out our lives to look for jobs. The problem with this training is that a person's financial potential is limited to the amount of time a person physically works. If the person does not work, the person does not get paid. In addition, when you work for money, you are partnering with the government. With your time, you earn the money and then the government takes thier part before you even see the fruits of your labor. The government's share can be up to 48% just to the federal government when we add in state and local taxes, the government share of your hard earned money can be as much as 60% . It is much harder to get ahead financially when you are working hard and only getting to use 40% of what you have earned.
Our schools, society and ,many times, our families train us to work hard for money. The key to getting off of this financial hamster wheel is to retrain your mind to look for opportunities rather than looking for a job.
Have you ever noticed that when you are looking for a specific type of car, suddenly that car is everywhere? When you are looking for a new home, you begin to see for sale or for rent signs everywhere. When you want a job, you find a job.
If you want more financial control, you have to retrain your brain to look for opportunities that make money for you, with out a lot of time or effort from you rather than looking for a job.
The opportunity of a lifetime comes along about once everyday. If a person takes the time to retrain his/her brain to look for opportunities rather than look for a job, opportunities will begin to pop up everywhere.
I have a challenge for you:
Spend one hour everyday looking for an opportunity. You do not have to spend one hour all at once. Spend 10 minutes looking through the classified adds or driving a different way to drop the kids off at school. Take note of opportunities during your regular routine.
The opportunities that you find will be your opportunities and different from my opportunities. Your opportunities will come a combination of your creativity and what you see.
Then persue those opportunities. Do not let what you see limit your potential.
Forget the idea that there is only one right answer to any given situation. Rather than saying 'I can't do that because I don't have this.' Ask yourself 'How can I do that?'
Happy Hunting.
Tuesday, April 24, 2007
Tracking For Financial Fitness
Imagine a Weight Watcher's meeting with no scale, no food journals, no accountability. How would you gage your progress. It's Impossible to really show significant impact on your financial life with out any controls. Tracking your income and expenditures is vital for Financial Fitness. The actions of recording and reviewing your financial information with an unbiased approach makes introducing new behaviors easier and quantifies the change. Consider for instance the amount of money that you spend on dining out each month. With out tracking this expense it would be impossible to know exactly how much you are spending and it is easy to spend a lot on expenses like this, because the amount that gets doled out at each restaurant is nominal. However these expenses tend to add up quickly. For example imagine that you stop for a quick breakfast and coffee each morning and and that that breakfast costs you an average of $4.00 each day. Also, at lunch time you go out for a quick pick-me-up lunch that costs you an average of $6.00 per day. If you work 5 days per week, this cost you roughly $217.00 per month ($10.00 per day time five days per week time 52 weeks per year divided by 12 months) or a whopping $2600.00 per year. may of us spend much more than this just on meals out not to mention other small incidentals and often end up wondering where our money went to.
It is crucial that you know where ALL of your money is going to if you want to be in control of your financial life. Take a minute each day to list all of your income and expenses and the tally up what you are spending on incidental items. How could you eliminate some of that expense? Could you pack your lunch twice a week (at an approximate savings of $624.00 per year)? Or perhaps, you could make a breakfast at home in the morning (approximately $1040.00 per year saved).
There are literally hundreds of places to find hidden money, but with out tracking your income and expenses you will not have the information necessary to find these hidden treasures or to take action.
It is crucial that you know where ALL of your money is going to if you want to be in control of your financial life. Take a minute each day to list all of your income and expenses and the tally up what you are spending on incidental items. How could you eliminate some of that expense? Could you pack your lunch twice a week (at an approximate savings of $624.00 per year)? Or perhaps, you could make a breakfast at home in the morning (approximately $1040.00 per year saved).
There are literally hundreds of places to find hidden money, but with out tracking your income and expenses you will not have the information necessary to find these hidden treasures or to take action.
Wednesday, April 11, 2007
Check Out This Pod Cast On Internet Marketing
I found this blog while searching for information on Rich Dad. The pod cast was very insightfull and I gleaned alot of great ideas and inspiration from it. This pod cast contains a lot of useful information for anyone looking to create income on the internet.
http://www.internet-based-business-mastery.com/ibm-26-the-secret-mindset-needed-to-get-started-as-an-internet-business-master
http://www.internet-based-business-mastery.com/ibm-26-the-secret-mindset-needed-to-get-started-as-an-internet-business-master
P3I Investing Strategy of the Month- Financial Starting Point by Dannielle Fritz-MacDuff
We began the P3I investing workshops as a tool for our clients to take back control of their financial future and empower each customer to reach their goals and achieve their dreams. So I thought adding one strategy each month to this blog would be helpful to others.
Financial Starting Point-
Most of us know how to plan a road trip. Start with where you are and mark out a path on the road map. If you run into a road block, re-route and keep moving forward.
This simple strategy is the best way to start a financial journey as well.
What I find is that often clients do not know where they really stand financially and many are afraid to find out. It is much less traumatizing to go along semi - ignorant of what our financial snapshot looks like, than to get in and be brutally honest about how much money we spend or borrow. This fear of what the real picture of our financial lives looks like is what holds most of us back and leaves the money in control of our actions. P3I investing is about putting the person in control of the money through action.
Start with one day and all of your financial information.-do a "brain dump" and list all of your income and where it comes from.
Next list all of your liabilities ( everything and everyone that you owe money to.) and the total balance due for each bill. Be brutally honest in this step, if you leave out the loan from uncle Jim or the doctor bill that is lowering your credit score, you will sell yourself short and set yourself up for failure.
List all of your expenses including monthly payments for each liability. Don't forget to include miscellaneous living expenses like toiletries and food. Also make sure you include a realistic expense for things like; entertainment, salon visits, clothing and other items that are just part of life.
Now List every thing that you own - if you had to give a list to an insurance adjuster because your home burned to the ground and you lost everything, what would be on that list. Go through your home and catalog everything that you own and assign a dollar value to these items. Also include things like cash in the bank, stocks, bonds, real estate owned, businesses that you own and other intangible assets.
Now set that aside and we will come back to it. For the next two weeks, carry a small notebook and pen or pencil with you and write down everything that you purchase or spend your money for. Include expenditures for things as small as a piece of gum form the candy machine. At the end of the two weeks go back and tally all of your expendituture by like expenses. This may sound daunting, but it will give you a place where you can review where your money is going and make you more conscious of where you are actually spending your money, which puts you back in control. That control allows you to make your money work for you instead of constantly working harder for money.
I am not saying that you will be able to quit your job tomorrow, or maybe you will. That is really up to you. But if you start here and consistently do five things, you will be able to make yourself financially free in 10-15 years. 10 -15 years is relatively fast if you consider that most of us work at our jobs for 40 plus years. Here are the five things that you MUST do to make yourself financially free:
Learn something new and useful everyday- the key word hear is useful. If you can not apply this knowledge, it is just taking up space in your brain. Don't get me wrong, interesting trivia definitely has its uses and can be fun, but learning something about your money that puts you in the drivers seat will help you have more time for the fun stuff
Know your exit strategy- why do you want to be financially free? The why is so much more than the how because the why drives us. The why makes us get out of bed in the morning and the why keeps us moving forward when it looks like it is all about to hit the fan. After the why comes the when- Complete this sentence -I will have made it when... . That when is your exit strategy.
Find a friend to hold you accountable and then ...lie. I don't mean start telling outlandish lies about what you are doing. I mean start telling people what you are working on. Since you have not actually accomplished your goal yet it is technically a lie and not fact. we lie to our selves everyday when we say things like "I could never do that" or "You can't do that here" or "I'll never be rich" and those lies hold us back because we believe them. so why not lie about the opposite and watch it come true. If you tell someone about your plans, you are three times more likely to succeed because you will subconsciously work harder at the project to save face. Get someone to be your success partner and ask them to talk to you once a week to check in and see how things are going.
Choose to be financially free - This sounds easy, but the trick is to make that choice everyday and then carry that choice over to the choices we make when we spend our money. Choose to spend your money on your education and on things that will continue to put moeny in your pocket even if you stop working.
And finally, Take Action - you have to act to make things happen. Just talking about becoming financially free is not enough, you have to begin taking steps to get to your goal. Do something, even if it is wrong. If you make a mistake, then at least you have learned something, even if it is what not to do.
Thanks for visiting our blog. Look for more P3I investing strategies coming soon and check our web site, we will be posting down loadable worksheets to help you with this strategy.
Financial Starting Point-
Most of us know how to plan a road trip. Start with where you are and mark out a path on the road map. If you run into a road block, re-route and keep moving forward.
This simple strategy is the best way to start a financial journey as well.
What I find is that often clients do not know where they really stand financially and many are afraid to find out. It is much less traumatizing to go along semi - ignorant of what our financial snapshot looks like, than to get in and be brutally honest about how much money we spend or borrow. This fear of what the real picture of our financial lives looks like is what holds most of us back and leaves the money in control of our actions. P3I investing is about putting the person in control of the money through action.
Start with one day and all of your financial information.-do a "brain dump" and list all of your income and where it comes from.
Next list all of your liabilities ( everything and everyone that you owe money to.) and the total balance due for each bill. Be brutally honest in this step, if you leave out the loan from uncle Jim or the doctor bill that is lowering your credit score, you will sell yourself short and set yourself up for failure.
List all of your expenses including monthly payments for each liability. Don't forget to include miscellaneous living expenses like toiletries and food. Also make sure you include a realistic expense for things like; entertainment, salon visits, clothing and other items that are just part of life.
Now List every thing that you own - if you had to give a list to an insurance adjuster because your home burned to the ground and you lost everything, what would be on that list. Go through your home and catalog everything that you own and assign a dollar value to these items. Also include things like cash in the bank, stocks, bonds, real estate owned, businesses that you own and other intangible assets.
Now set that aside and we will come back to it. For the next two weeks, carry a small notebook and pen or pencil with you and write down everything that you purchase or spend your money for. Include expenditures for things as small as a piece of gum form the candy machine. At the end of the two weeks go back and tally all of your expendituture by like expenses. This may sound daunting, but it will give you a place where you can review where your money is going and make you more conscious of where you are actually spending your money, which puts you back in control. That control allows you to make your money work for you instead of constantly working harder for money.
I am not saying that you will be able to quit your job tomorrow, or maybe you will. That is really up to you. But if you start here and consistently do five things, you will be able to make yourself financially free in 10-15 years. 10 -15 years is relatively fast if you consider that most of us work at our jobs for 40 plus years. Here are the five things that you MUST do to make yourself financially free:
Learn something new and useful everyday- the key word hear is useful. If you can not apply this knowledge, it is just taking up space in your brain. Don't get me wrong, interesting trivia definitely has its uses and can be fun, but learning something about your money that puts you in the drivers seat will help you have more time for the fun stuff
Know your exit strategy- why do you want to be financially free? The why is so much more than the how because the why drives us. The why makes us get out of bed in the morning and the why keeps us moving forward when it looks like it is all about to hit the fan. After the why comes the when- Complete this sentence -I will have made it when... . That when is your exit strategy.
Find a friend to hold you accountable and then ...lie. I don't mean start telling outlandish lies about what you are doing. I mean start telling people what you are working on. Since you have not actually accomplished your goal yet it is technically a lie and not fact. we lie to our selves everyday when we say things like "I could never do that" or "You can't do that here" or "I'll never be rich" and those lies hold us back because we believe them. so why not lie about the opposite and watch it come true. If you tell someone about your plans, you are three times more likely to succeed because you will subconsciously work harder at the project to save face. Get someone to be your success partner and ask them to talk to you once a week to check in and see how things are going.
Choose to be financially free - This sounds easy, but the trick is to make that choice everyday and then carry that choice over to the choices we make when we spend our money. Choose to spend your money on your education and on things that will continue to put moeny in your pocket even if you stop working.
And finally, Take Action - you have to act to make things happen. Just talking about becoming financially free is not enough, you have to begin taking steps to get to your goal. Do something, even if it is wrong. If you make a mistake, then at least you have learned something, even if it is what not to do.
Thanks for visiting our blog. Look for more P3I investing strategies coming soon and check our web site, we will be posting down loadable worksheets to help you with this strategy.
Thursday, April 5, 2007
How To Work The System Instead Of Beating The System by Dannielle Fritz-MacDuff
As an accountant and financial educator I have been asked countless times how to beat the tax system. After all, our largest expense in life is our tax bill. We are taxed when we earn, taxed when we spend, taxed when we save and taxed when we die. So how does a person, the average working Joe, "beat the system"? The simple answer is... you don't. Instead, learn to work the system. I have included some things that you can do that will help you make the system work to your advantage.
Talk to a tax professional.
Interview several tax professionals, not all accountants and tax agencies are created equal. Much like lawyers, accountants tend to specialize. Find one that is competent and willing to put forth an effort and guide you. You tax advisor should be up to date with the latest tax loopholes and requirements as well as being a forward thinker. A forward thinking tax advisor will be able to help you create a workable strategy that is proactive and takes advantage of every possible loophole available to you and advise you on what changes could be made that will open up additional loopholes.
Change how you make your income.
This does NOT mean quit your job. Instead look for and take advantage of opportunities that will move your money from earned income, which is the most highly taxed income with the fewest allowed loopholes, to passive income. Passive income allows multiple loopholes and is taxed on a completely separate set of rules.
When you make your money from a job as an employee the tax rules in their simplest form look like this:
EARN ---- TAXED ON ALL OF IT ----- SPEND WHAT'S LEFT
When you make your money from investments that are working for you, this is passive income. The tax rules in their simplest form for passive income look like this:
EARN---- SPEND WHAT YOU NEED TO SPEND ---- TAXED ON WHAT IS LEFT
Most of us are only using the first tax strategy and making all of our money as employees. Converting that earned(employee) income into passive income will allow you to take advantage of the second tax strategy which puts you in control of your financial future your tax bill.
Monitor and control your expenses
I am not preaching "live below your means, cut up your credit cards and don't use debt". Instead pay attention to where you are spending your money. We all should live the good life. what ever your good life may be. When you pay attention to where your money is going, this gives you more control. Controlling your expenses simply means making wise choices. Most of us get caught in the consumer craze. We spend millions every year on credit card interest and don't use those credit cards to our advantage. Instead we choose to buy things that require us to work harder to pay for the stuff that we want instead of first buying the things that will put money into our pockets that can pay for our toys. Instead use credit to your advantage. Use other people's money to buy your investments and assets that are making money for you. If you are using other people's money to make money for you, your return on investment is infinate.
ex. you purchase a rental property for $5000.00 using an advance from your credit card. After all of the expenses are deducted from the rental income (including your credit card payment) you have 200.00 left over every month. Your rate of return =cashflow from the investment(profit) devided by the cash that you put into the investment (0 of your own money). That return is infinate and you do not have to pay back the debt, your tenant pays that for you.
Pay Yourself First!
Don't dip into your savings when times get tough. Let the pressure build up and motivate you to think outside of the box to find ways to make more money. Then use that savings to buy investments or assets that put money in your pocket. These sources of income will be there even if you loose your job.
Talk to a tax professional.
Interview several tax professionals, not all accountants and tax agencies are created equal. Much like lawyers, accountants tend to specialize. Find one that is competent and willing to put forth an effort and guide you. You tax advisor should be up to date with the latest tax loopholes and requirements as well as being a forward thinker. A forward thinking tax advisor will be able to help you create a workable strategy that is proactive and takes advantage of every possible loophole available to you and advise you on what changes could be made that will open up additional loopholes.
Change how you make your income.
This does NOT mean quit your job. Instead look for and take advantage of opportunities that will move your money from earned income, which is the most highly taxed income with the fewest allowed loopholes, to passive income. Passive income allows multiple loopholes and is taxed on a completely separate set of rules.
When you make your money from a job as an employee the tax rules in their simplest form look like this:
EARN ---- TAXED ON ALL OF IT ----- SPEND WHAT'S LEFT
When you make your money from investments that are working for you, this is passive income. The tax rules in their simplest form for passive income look like this:
EARN---- SPEND WHAT YOU NEED TO SPEND ---- TAXED ON WHAT IS LEFT
Most of us are only using the first tax strategy and making all of our money as employees. Converting that earned(employee) income into passive income will allow you to take advantage of the second tax strategy which puts you in control of your financial future your tax bill.
Monitor and control your expenses
I am not preaching "live below your means, cut up your credit cards and don't use debt". Instead pay attention to where you are spending your money. We all should live the good life. what ever your good life may be. When you pay attention to where your money is going, this gives you more control. Controlling your expenses simply means making wise choices. Most of us get caught in the consumer craze. We spend millions every year on credit card interest and don't use those credit cards to our advantage. Instead we choose to buy things that require us to work harder to pay for the stuff that we want instead of first buying the things that will put money into our pockets that can pay for our toys. Instead use credit to your advantage. Use other people's money to buy your investments and assets that are making money for you. If you are using other people's money to make money for you, your return on investment is infinate.
ex. you purchase a rental property for $5000.00 using an advance from your credit card. After all of the expenses are deducted from the rental income (including your credit card payment) you have 200.00 left over every month. Your rate of return =cashflow from the investment(profit) devided by the cash that you put into the investment (0 of your own money). That return is infinate and you do not have to pay back the debt, your tenant pays that for you.
Pay Yourself First!
Don't dip into your savings when times get tough. Let the pressure build up and motivate you to think outside of the box to find ways to make more money. Then use that savings to buy investments or assets that put money in your pocket. These sources of income will be there even if you loose your job.
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