YOU DON’T HAVE TO BE POOR
You Can Be Rich
How to restart your financial life from wherever you are-
Get out of the
working trap and retire rich
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disclaim any liability incurred by misapplication of any information in this self-help book. For major financial decisions,
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PARTIAL TABLE OF CONTENT
++++
PART ONE
MULTIPLE REALITY CHECKS
1. To Be or Not to Be
2. The Pathway to Wealth
3. Money and Power
4. Money and Politics
5. Money and Happiness
6. The Good and Bad Within
PART
II:
PLAYERS, PROBLEMS AND CHALLENGES
7. Wealthy, Rich or Poor?
8. Who are The Rich?
9. Who are
The Poor?
10. Other Causes of Poverty
11. Poverty in America
12. Poverty Around the World
13. Getting
Out of Poverty
14. A Personal Change of Attitude
15. You Don’t Have to Finish School
PART
III:
ALTERNATIVE SOLUTIONS
16. How to Get Rich
17. Ways and Means to Get Rich
18. Everlasting
Power of Education
19. The Financial Literacy Factor
20. Learn From The Rich
21. Getting Out of Debts
22.
Keeping Track of Money
23. Saving Money
24. Borrowing Money and Credit
25. Buying a House
26. Ours, His
and Her Money
27. Ways About Investments
28. Creating a New Business
29. Creating a Job-Business
30. Changing
Paradigm
31. Retire and Restart Your Life
32. Don’t Wait for Retirement
33. One-liners to Succeed
34. How to Ruin Your Financial Life
35. This is It!
36. Definition of Key Terms
37. References
+++++++++++++++++++++
YOU DON’T HAVE TO
BE POOR
Introduction
You don’t have to be poor when you are living in a society that
offers countless opportunities to get rich every day. There have never been more business ventures and more money in the world
than there is today, yet most families are not wealthy. It is also an ironical fact that every day someone grow richer while
millions of working class Americans live from paycheck to paycheck and countless others sink below the poverty lines struggling
to make ends meet. As worldwide business increase, poverty, joblessness and the gap between rich and poor continue to grow.
These are indeed ‘the best of times and worst of times’ as Dickens said. Whether you are man or a woman, rich
or poor, we are all coincidentally living at the same moment in history. Nonetheless, the worst of times for others, could
as well be the best of times for you.
This book is designed in three sections: First, we will review a multiplicity
of reality checks in terms of history, power wealth and happiness. Second, we will identify the wealthy, the rich and the
poor in order to clarify the problems and challenges of getting rich and moving out of poverty. The final section is dedicated
to explore specific strategies on how to get rich, learn from other millionaires how to increase your wealth and retire in
comfort with your own safety net....
Each of the 37sections is a self-contained essay and you can read it over
in any order. I am confident that once you review the business ideas and apply some of the strategies discussed here, you
will be on your way to financial independence by making your money work for you instead of you working hard for little money.
Here you will also find names and references to countless examples of individuals who are first generation rich and many others
who started with nothing (zero balance) but today are worth millions. How did they overcome the everyday obstacles and reached
success? Together, we will find out and learn from the collective experience....
PART I
MULTIPLE REALITY
CHECKS
To Be or Not To Be?
Who are you? What do you need? What do you want? Do you want to learn
more about money matters? Do you want to improve your financial chances of success? Are you willing to change your mind and
look at life from another perspective? Do you want to get off the working trap and grow rich? Would you make yourself available
to work at anytime, 24 hours a day and 7 days a week? Do you understand that building financial security takes self-discipline
and hard work? Are you willing to redirect your personal lifestyle to achieve your goal?
If you answered ‘NO’
to any of these questions ......stop here!
2: The Pathway to Wealth
It has been said that nothing gives more pleasure to authors than to find their work respectfully quoted by others. Judge,
then how much grateful I am of bringing to your attention the many names of people and the ways in which they talked about
money. My vanity would be wonderfully delighted if you attribute these ideas to myself, though let’s all be conscious
that not even a tenth of one percent of the wisdom collected here can be ascribed to me or to anyone who may claim so. Although
I stand behind the full content of this book, the final conclusions are the synthesis of common sense from wise men and women
throughout all ages and nations.
The first lessons hereafter are paraphrased and styled from The Way of Wealth,
published by Benjamin Franklin. ‘We the people’ have frequently complained about rich-poor relationships, love,
money, business and taxes; and taxes are indeed, very heavy upon some. Old Benjamin Franklin pointed out, long time ago (An
Introduction to Poor Richard Almanac, 1750’s), that even when taxes are high, we are taxed twice as much for idleness,
three times as much for our pride and four times as much for our foolishne. Wasting time must be considered as the greatest
prodigality, since elsewhere he tells us ‘Lost time is never found again; what we call time enough always proves little
enough; and, since you are not sure of a minute, don’t throw away an hour’. Let us then be up and be doing something
productive to drive our own business, then let’s go ‘early to bed and early to rise, which makes a man healthy,
wealthy and wise’, The wisdom transmitted by Benjamin Franklin’s doctrine is based on practical experience, self-knowledge,
care, industry, frugality and common sense for hundreds of years, yet many of us who would approve of these principles today,
go on practicing the contrary. Why?.....
3: Money and Power
The Christian tradition
asserts that ‘The love of money is the root of all evil’, it warns that people who wants so much to have money
may fall in all kinds of traps and temptations (Timothy 6:10) but I would remind you that; money itself has no good nor evil
powers. It can only be used in accordance to the face value we assign to it. Its very existence is conventional and temporary
at the same time. Money is not a cause: It is a medium created by man for mutual trade, certainly the most effective, complex
and volatile tool that can be used to exchange material possessions and obtain socio-economic power.
Money is in the hand of the few and
the poor are many. The overall implications are openly opportunistic, monopolistic, dangerous and complex for a lot of reasons,
not the least of which is that most humans are greedy and self-centered. Some members of the “power elite” really
don't care much about anyone outside the small circle of rich men and women conveniently sheltered behind the phrase:
“We the people of the United States”.
4: Money and
Politics
The American political system is the higher evidence of how the wealthy get control of
the game and dominate the vast human resources of the poor. Although a voter might consider other issues rather than wealth,
profession or how a candidate made their own money, still, a contender has to be considerably wealthy or get rich-help quick
to enter the presidential politics game. Indeed, most presidential candidates in the US emerged from families at the top five
percent of the socio-economic class, and in most electoral contests, poor and middle class people tend to elect the rich or
the one who spend more advertising funds. Money is the main fuel behind the local, state and presidential campaigns......
What is shocking to most people in the United States is the fact that, clear evidence of the problem of corruption and economic
disparity rampantly exists in our own front yard, yet no one in power seems to care much to talk about it. ....
5: Money and Happiness
Although this book will help you get out of poverty
by generating money, be captioned that more money alone will not necessarily make you happy. Money often accentuates the cash
flows ideas running in our heads: If your goal is to become financially secure and independent, you work on it and you will
likely achieve it. But if your motives are to spend money in anticipation of having money to spend it before you even earn
it, an increase in your income most likely would increase your expenses, and you won’t make it. Furthermore, an uncontrolled
drive to be rich and famous may become a trap of self-fulfilled discontent. Not only does having more things may prove to
be unfulfiling, but people for whom affluence is a priority in life may have to experience an unusual degree of anxiety and
depression.
For the context of this book, let’s define happiness as an emotional state of personal pleasure
during which you are able to satisfy your perceived needs, get what you want when you want it and enjoy whatever you are doing....
Let’s face it, you definitely need money in order to achieved some of life's basic comforts and necessities,
but remember; adding honey to honey doesn’t make it more sweet. Thus, more money doesn't necessarily buy more happiness.
Emotional maturity, good health, love, family stability, financial organization and hard work are also required to solve the
happiness equation...
6: The Good and Bad Within
Many of
us spend too much time looking for happiness and security in other people and places when in fact the main source of good
and bad feelings is within ourselves. Places, natural forces, animals and other people are interconnected but at the same
time each one experience their own independent existence. The verbal tradition of the Toltecs (ancient Mexican tribe) tells
us that we must work diligently to eliminate the damaging notions of fear, judgment and guilt from our minds, for these are
the root causes of personal failure and suffering. Contrary to many other traditions, we are not totally responsible for everything
that happens here; there are other forces and players. To achieve freedom from negativity and superstitions, the Toltecs recommended
a positivist meditation process in three stages: Awareness, transformation and clarity of intention.
First, we
must develop a conscientious awareness of ‘who’ we are, ‘where’ we stand, and ‘what’ do
we want to achieve with the limited time and resources we actually have available. We must reexamine the set of beliefs, traditions
and assumptions about the world and ourselves, which indirectly dictates our reactive-proactive behavior. In most cases, theses
ideas originated from another era when people and conditions were very different from what we are today. Most assumptions
are not based on facts but in a set of beliefs generated by supernatural fears and philosophical ideas, made-up throughout
history and re-taught by others. You must develop a clear understanding of your own moral standards in accordance to your
life....
PART II:
PLAYERS, PROBLEMS AND CHALLENGES
7: Wealthy,
Rich or Poor?
Understanding your socio-economical position within the pyramidal structure
of today’s society is essential for taking control of your financial future. Sociologist may differ with the names and
quantity of social classes, but I will list five categories for the context my argument: The Wealthy, The rich, The Working
Middle Class, The Poor and the Underclass.
At which level are you?
If you are WEALTHY, your nameplate is on the building. You are at the top of the food chain with those who owns the means
of production, control the market and have accumulated the greatest amount of capital (over a million dollars income per year).
Supported by government and protected by the military, you dominate the rest of the pyramid.
If you are RICH, your
corporate nameplate is on the door. In addition to your own business or a high paying job, you have money invested and working
for you with multiple streams of income (over $100,000.00 income per year). Your home and luxuries are paid off, your children
are getting a solid education and you are free from liabilities.
If you are working MIDDLE CLASS, your name is
on your desk. From paycheck to paycheck, you work hard for money to pay your bills but your income is less than $100,000.00
per year. If your income increases, your taxes and your expenses also increase. You pay a high rent or have a long-term mortgage
in addition to your car and other liabilities. Technically, you are walking on a treadmill working-for-money to pay money;
the working trap.
If you are POOR, your name is on your shirt. You may hold a low paying job with little education
but you are the first one to get laid-off with minimal unemployment benefits and may be eligible for public assistance. Your
household income is less than $25,000.00 per year and you are living below the poverty line most of the time.
If
you are UNDERCLASS no one knows who you are or why you are an untouchable and undesirable sub-human being with no social classification.
This diverse group includes scum outcasts hiding behind the scene of all races and social classes. You have no steady address,
non-verifiable source of income, no credit ratings and no official job. You may have cash in your pockets to roam the late
night life through the dark alleys of failure in the company of drifters, panderers, smugglers, reprobates, hustlers, sociopath,
riff-raffs, felons and all sorts of criminal elements that breed off the underground.
Every day you choose what
to do with your mind, your time and your money. Believe or not, every day you make a move to be rich, middle class or poor.
What is your next move?
8: Who Are the Rich?
Being rich
is more than having money. It is having all what you need and being able to do the things you want whenever you want and travel
wherever you like to go with enough money to pay for your life style. It is being able to stop working for years and have
multiple source of income to pay for all your living expenses. It is being able to think without economic pressures and free
from all form of discrimination. Being ‘truly rich’ includes having lasting friendships, family stability, sympathy
and understanding with other members of society, which manifest itself with an inner peace of mind measurable only in spiritual
terms. It is a socio-economic position from which you can obtain a balanced mixture of love, money, physical and mental health....
.... In addition to having multiple
sources of income, you must have a rich state of mind to manage your time & money and stay rich.
A research
conducted by Dr. J. Stanley and Dr. William D. Danko (The Millionaire Next Door) indicates that 80% of the millionaire living
in America are first generation affluent, they did not inherit their fortunes and 97% of them own a medium home, not a mansion.
Their study demonstrates that it pays to become an entrepreneur.
Let’s compare the affluent rich to a jogger
who seems not to need the exercise. In fact, he is in such a good shape because he works at staying physically and financially
fit....
9: Who Are the Poor?
What does it mean to be poor? How is poverty created?
How can a person get out of poverty? Can poverty be measured, controlled or eliminated? Are you really poor? How poor do you
think you are? Poverty is a mental, physical and social condition: It is a lot more than lack of money; it is not having a
job, it is lack of shelter, it is hunger, it is being sick and not able to see a doctor, it is emotional insecurity, it is
not being able to go to school, it is depressive, it is humiliating, it is fear for the future, it is powerlessness, it is
lack of political choices, it is socio-economic slavery, it is the ultimate lack of freedom, and it is a social weakness spreading
misery everywhere.
...self-delusion and social contradictions.
10:
Other Causes of Poverty
The links between the vicious cycle of poverty, moral degradation of society
and our personal behavior starts at the earliest stages of social life. Selfish actions by many of the ones that have money
contribute to both the proliferation and the perpetuation of poverty from one generation to the next. A brand of personalized
pride mixed with greed, sloth, arrogance, ignorance and maliciousness are indirect motives behind the unrestrictive wealth
accumulation by the few. They maintain a bias economic system plagued with monopolies, unemployment, racial discrimination,
educational neglect, and sheer social injustice.
Poverty compounds and manifest itself with the general malnutrition
of the family, child neglect, marital abuse, divorce, low incomes for the working poor, high cost of medicine, high rents,
exploitation of workers, police brutality, minimum wages, taxes on necessities, redundant payroll taxes, unnecessary charges
in bank accounts, high legal fees, social insecurity, inappropriate housing, advertising for unhealthy products, low health
services, social welfare, lack of vocational education, humiliating handouts, front cover charity, commercialization of religious
houses, extreme spiritual cults, gangs, high cost of properties, speculative investment, variable interest rates, inappropriate
childcare, teenage pregnancies, broken homes, educational malpractices, drug-dealing, smoking, alcohol, gambling and a multiplicity
of illegal activities which mix up the social and psychological realities of poverty....
11:
Poverty in America?
One of the richest and developed countries in the world? Yes we are, but poverty
is a reality here too. However, we must remind ourselves that it is far worse situation for millions of human beings trapped
in the developing countries of the world. Yet to live in a strong economy like ours doesn't mean much for a significant
percentage of the population who is struggling to survive with very little in the midst of plenty.
The U.S. Department
of Health and Human Services (DHHS) issues another version of the federal poverty measure called the "poverty guidelines."
These guidelines are a simplification of the poverty thresholds and used for administrative purposes. In 2003, the DHHS Poverty
Guidelines for a family of 1,2,4,6 members living in the United States was as follow:
1=$8,980 2=$12,120 4=$18,400
6=$24,680
The American working class and the poor may be struggling to get by with social help or a medium salary, but
there is a sovereign reality to consider; when we as a group, are compared to the rest of the world -no matter if you are
rich or poor- just living in America, makes us all look fabulously wealthy.
12: Poverty
Around the World
Notice that a person earning less than US$25.00 a day (8,980/365) in the United
States is considered living below the poverty lines, yet millions of people around the world have to make due or die with
less than one dollar....
Do I need to tell you how obscene and potentially chaotic that is? There are more poor people
than there are rich. Do I need to warn you that if those hungry people get desperate enough, if they have nothing to get or
nothing else to loose, they will eventually have no choice but to come after the few of us who are better off? Even if we
don't care about them, self-preservation alone should make the rich want to create more jobs and opportunities so that
the poor masses could at least satisfy their basic needs of food and shelter.
13:
Getting Out of Poverty
Although the highly commercialized ‘supply and demand’
working conditions may enslave some people, almost everyone seem to agree that a steady job is the best route out of poverty;
unfortunately, governments around the world are not about to legislate full employment for everyone and cut poverty out. The
capitalist creation of jobs is currently dependent on the potential profit for the business rather than on the actual needs
of the workers. When it comes to being rich or poor, it is a blatant reality viewed as a personal issue, it is like a ‘get
all what you can get jamboree’, and most people are left hanging around to make a move on their own.
Juan
Somavia (2003), Director-General of the Labor International Office, studies poverty as social disease and he suggests a practical
solution for this worldwide problem, he calls it a "decent work dividend". It identifies four governmental “tools”
that can be employed for poverty control and its eventual eradication:
1. Creating jobs: Poverty elimination is
impossible unless the economy generates opportunities for investment, entrepreneurship, small business, job creation and sustainable
livelihoods based on the need of the workers.
2. Guaranteed rights at work: People in poverty need a voice to obtain
recognition of rights and to demand respect. They need unionized representation and participation. They also need good laws
that are enforced and that work for, not against their interest.
3. Basic social protection for all: Poor people
are unprotected as a group. The earning power of those living in poverty is suppressed by marginalization, over taxation and
lack of support systems. Without rights and empowerment, the poor cannot get out of poverty.
4. Promoting dialogue
and conflict resolution: People in general must be given the opportunity to negotiate and understand that preemptive dialogue
is the best way to solve problems peacefully while at the same time avoid rebellion, terrorism and economic wars (Somavia,
2003).
As you can see by now, solving worldwide problems is a long and complex process...
14:
A Personal Change of Attitude
The most demanding thing about being in economic difficulties is
getting bogged down and feeling like a desperate loser. Yes, poverty is embarrassing, frustrating, frightening, and depressing,
but, you don't have to stay home all day feeling sorry for yourself; wallowing in misery will not solve your problems.
So what do you do?
First, do not to blame anyone for your deficit or low-income situation. Remember that nearly
everyone else has financial problems: the government, the church, the rich, the poor, and you. Essentially, you have to face
your own challenge of getting basic needs met while at the same time maintain focus on getting out of the hole.
Donald
Trump compares your financial life as a private jet on the landing strip. “Get going.... Move forward… Plan for
a take off… Don’t just sit on the runway and hope someone will come along and push your airplane… Change
your attitude and gain some altitude: You will love it up there.’ He said.
Motivational speaker Larry Winget
writes and speaks in a very confrontational way to get you out of poverty in his book ‘Shut Up, Stop Whining & Get
a life’.
Three reasons why people don’t succeed:
They are lazy…
They act stupid…
They don’t give a dam…
... Larry Winget
15: You Don’t Have to Finish School
The traditional road map out poverty is: go back to any school, get a job, work for money, save as much as you can
and retire with help from social security. However, there is an alternative combination for a way out: Keep learning part-time
at any school, but at the same time save aggressively and start you own business venture today, join a business network, buy
and sell any wholesale product or get a franchise somewhere and invest in real estate (see section 16-17).
You
definitely don’t have to wait until you finish school to start making money and get rich. While a solid education will
ensure a job to retire with a safety net, a self-owned business venture with investment in real estate will increase your
chances to retire younger and rich. Using a conservative 80/20, it is estimated that 20% of the population are rich and getting
better, while 80% are struggling working class and getting poorer.
Looking at the top 20% group that is getting
better in the book ‘Getting Rich Your Own Way’ by Brian Tracy, it is clearly demonstrated that you have better
change of making it rich when you get in business by yourself than by staying in school:74% of millionaires have self-owned
business
10% hold executive management positions
10% are doctors, lawyers & professional
04% are professional
in sale/retail services
02% are from all others business alternatives...
16: How to
Get Rich
If you desire to get rich- it is as plain as the way to the market. It depends chiefly
in two words, industry and frugality: Waste neither time nor money but do the best use of both.
Benjamin Franklin,
1754.
The basic ingredients to get rich are time and money: Since everyone has the same amount of time, the next
step is to use your mind to manage your resources to make more money. Getting rich is the combined result of multiple factors,
but the entire process starts with your imagination. Then, what is keeping you from being rich? In most cases, it is only
a matter of belief. According to Suze Orman in her book ‘The Courage to Be Rich’, you must have the courage to
believe that you can be rich, choose to be rich and take necessary steps to make enough money to achieve your goal.
“You must want more…There is nothing wrong about wanting more”
Suze Orman...
17: Seven Ways to Get Rich
"The number one rule
to get rich is to know the difference between an asset and a liability, and to buy assets... then "
Robert
Kiyosaki
Certainly you can create your own new way to wealth and cook your own meals, but the advise from the millionaire
next door is to get in the rich buffet line, stay in line, and follow one or more of the following proven Get-Rich paths to
independent wealth:
Get-Rich path 01: If you are employed, look for the inside track to get promoted, take advantage
of your pension benefits and be the best employee you can be. Take the free advise from the financial planners at your bank
and deduct 10-20% of your salary by an automatic deposit into money market, municipal bonds and your own IRA-401K retirement
account, and “never” make a withdraw: Remember that if you can save just $10 dollars a day, you can retire rich,
but if you can save and invest $20 a day, you can get rich quicker and retire younger. Put the same amount aside every pay-day,
even if you have to borrow it from someone else. While the automatic saving plan is in effect, continue to venture out into
any other kind of business in the fast lines. No matter what happens, in less than ten years, you will have at least $100,000.00
safety net and get rich this way or the other.
If you don’t have a job, get your driver’s license and
start actively looking for one immediately or read sections 26-28 to create your own job-business today.
Get-Rich
path 02: Become an entrepreneur to improve or create a new product and start up a business, any kind of business, for example:
...
See Get-Rich path 03-04-05-06-07...
It is not recommended that you do anything
exactly as I do. My approach uses a lot of other authors’ books and my personal ideas. But they are just examples; if
an opportunity looks too big or too small, if you do not see its potential, if it is so complex that you do not understand
it… don’t do it! A simple everyday math and common sense is about all that is needed to catch the next wave and
get rich.
18: Everlasting Power of Education
The greatest
wealth is education. “If people are flexible, keep an open mind and learn, they will grow richer trough the changing
times… If they think money alone will solve problems, I am afraid those people will have a rough ride”, said
Robert Kiyosaki, “Intelligence solves problem and produces money: Money without financial intelligence is money soon
gone.”...
In the world of business, “Homework is required and there will be a test.” Said Donald
Trump. While you can learn a lot in school, listening to people and watching events around you, “the bottom line is
to know and understand the process: Your homework is to learn everything you can about whatever business you are doing”.
Knowledge is the key, but it is a time sensitive commodity and the most prized piece of information can become obsolete or
irrelevant at any time: If you stop searching for understanding and do not upgrade the knowledge base, ignorance may set in
and ruin your chances for a better life.
19: The Financial Literacy Factor
Robert Kiyosaki is referred as a the “millionaire school teacher” because he specializes in teaching people
to be millionaires… ‘Education is important’, he said, but the main reason people struggle financially
is because they spend many years in schools and learned nothing about money… The result is that people learn to work
for money… but never learn to have money work for them.”
Although most people can learn to read news
and current events, some do not learn much about the world, and others seem not to understand it at all. We still learn by
trial and errors and since no one can know everything that there is to know, we must learn the right solutions from others.
20: Learn From The Rich
Have you noticed that the rich do not necessarily work
for money? Instead, they have money coming in and working for them through multiple ways and means: Earned income is the money
you earn from a day-pay job. Passive income is derived from profit generating assets (mostly real estate) and Portfolio income
is profit from paper assets such as stock and bonds. For example, what makes Bill Gates rich and richer everyday is not his
hard working ‘earned income’ but the passive and portfolio’s income generated by his investments.
Donald Trump is one of the richest people in America, yet he continues to...
They developed thousands of successful
business examples with new and profitable ideas. Harvey Mackay, in his book “We got Fired” examines this common
secret behind the success of many business celebrities of today. Among them: Bennie Marcus, founder of the Home Depot; Pat
Mitchell of PBS; Tom Stemberg- Founder of Staples; Joe Torre, Manager of the New York Yankees; Larry King- CNN host; Lee Iacocca,
Chairman of Chrysler Corporation and Michael Bloomberg, Mayor of New York City, just to name a few.
You should
also familiarize yourself with and learn from the historical and contemporary business style of people like Mary Kay, founder
of Mary Kay Inc; Jeff Bezos, Amazon.Com; Michael Dell, Dell Computers; Bill Gates, Microsoft; Andrew & Dale Carnegie,
Henry Ford, John D. Rockefeller; George Eastman, Thomas Edison, Alexander Graham Bell, Charles M. Schwab, Theodore Roosevelt,
Thomas Jefferson, Thomas Paine, Alfred Nobel, Paul Getty, Louis Gerstner, IBM; Allan Greenspan, U.S. Federal Reserves; Steven
Jobs, Apple Computer; Muhammad Yanus, the Grammen Bank; Frederic Smith, American Express, George Soros, Open Society Institute;
Carlos Gomez, UTA Communication; Sam Walton; Wal-Mart; Oprah Winfrey, the Harpo Group; Ted Turner, CNN; Andrew Grove, Intel
Inc…There is no end to this list and no limit to what you can get from the experience of top business people of our
time
"The door to the American Millionaire Club is not locked. It is quite possible for the successful individual
to make millions… There will always be room at the top for people with energy and imagination to implement new ideas
into products and services.”
J. Paul Getty
21: Getting Out of Debts
The content in this section isn't necessarily new information, but questioning yourself and repeating some memorable
pieces of advise will definitely help light up your way out of the debt trap. Which resources do I have? What are my short
and long-term goals? How much is my income? What are my expenses? What do I need? What do I want? What are my choices? What
can I do? How can I get out of this mess?
If you are already struggling with massive debt, considering bankruptcy,
feeling despair over low income and climbing credit card balances, you are not alone. All of us have some kind of debt at
one time or another.... Although it's probably not possible to live 100 per cent error free and debt free, help is available
to correct your course and manage the debt you already have. The methodology listed below is adapted from principles of Debtor's
Anonymous, and the key to your financial reorganization is based on consistently following these steps:
1) Make
a decision to change your life style and set a directional goal: debt free in three years!
2) Stop borrowing immediately,
stop digging deep into your own dirt hole.
3) Live one day at a time spending less; you don't need to incur
any new debt.
4) Cut unnecessary expenses, consolidated bills and refinance existing loans.
5) Make
auto-payment schedule and double the minimum payments on credit cards.
6) Keep and review your daily spending records
to know where money goes.
7) Start automatic saving 10-20% of your income as soon as possible....more
...In the final good debt-bad debt analysis,
you can choose to pay for professional help or you can do it yourself. Either case, you must find a way to increase your income,
eliminate debt and start saving aggressively at the same time. Its complex, it may sound simplistic, and well, it is simple,
but it's not easy. Just think about it and it will make common sense to you.
22: Keeping
Track of Money
Keep track of every penny that comes in and goes out of your life. Sweat it; you can't
have a dollar without a penny. I can assure you that this suggestion alone, coupled with not taking in new debt, will make
your life so much different. Maintain a weekly spending record or just a monthly record. It should take up very little of
your time but it will help to see how much money flows right out the expense column every month. It's not enough to guess
an amount. It's the small, everyday stuff that should be accounted for. You can use a computer or write it down on old
fashion piece of paper. Until you write down everything, you will never fully understand where your money problems are.
23: Saving Money
What does it take to start saving and get
out of debt? Jean Chatzky suggest in her book Pay It Down that you can start paying debts by saving an extra $10 a day without
overtime: If you skip a movie…If you skip lunch at McDonald…If you wash you own car…If you skip a Starbuck
cup of coffee… If you skip so many of the little things that you can live without, you could do it. Certainly, if you
manage to save $10 a day and do it every day, it will make magic for you when you invest it. Go over your regular bills and
cut on your interest by transferring balances, refinancing and consolidating your loans…Buy wholesale and cook your
own food…Relocate to less expensive area if you have to, change your car for an older model… Sell or donate
extra belongings and don’t buy more things that you don’t need.
A practical way to pay yourself first
would be to open a pre-tax (IRA, 401K) retirement account and fund it with the first 10-20% of your income deducted automatically
from your paycheck before taxes. It may seem that you have less money to go by but you will double save it from current taxes,
while your money works for you accumulating interest. If 10% look too difficult for your present situation, start with 2,
4, 8% or any amount, but make it mandatory, like your rent money, deposit it on time and automatic.
24:
Borrowing Money and Credit
After capital-cash and information, credit to use other people’s money
(OPM) is one of the most powerful economic forces of today. While it is true that irresponsible people misuse credit to destroy
their own financial life, there is evidence that the smart investors repeatedly use credit to enrich themselves. A bad debt
is accumulated by frivolous use of credit cards to buy jewelry, fancy cars, gambling and other personal items. These are expenses
which have to be pay out of your pocket, eventually spiraling down and making people poor. Good debt is OPM used to start
a business, buying wholesale to resale or to obtain other income generating assets such as rental real estate. You must rid
yourself of wasteful over spending habit and learn to use good credit for your financial advantage.
Some credit
counselors may recommend you to cut off your credit cards altogether. I say NO: I rather suggest ways to increase your credit
lines by...
25: Buying a House
To buy a house is
one of the most important steps to get rich, but do not try to buy a mansion which mortgage is more than twice your household
income per year. Thus, if your combined annual income is $100,000.00, set your affordable limit up to $200, 000.00 for a home.
Wait a little, buy a cheaper co-op instead, save at where you are to buy it after you become financially secure. If you buy
a house in anticipation of becoming wealthy, you may have to commit all your income to make ends meet. Consequently, your
domestic overhead expenses would not allow you to save or purchase any other investment.
26: Ours,
His and Her Money
A nice house will become a sweet home when the family is together in physical, emotional
and financial matters. There is not a single financial equation for a perfect marriage, but I have experienced a near perfect
living arrangement. First, draft and sign a simple pre-nuptial agreement in which both partners are treated as equals in the
relationship, even if you are not married and are just living together.
Each partner should retain their rights
to previous owned properties and the two of you should move in together to new a place, rented or purchased under both names.
Then get a) one personal bank account for her, b) one personal bank account for him and c) one joint checking-saving account
for “our” home-living expenses. Each partner should contribute at least 50% of his or her individual income to
the home-living account. Although we all have a common dollar currency, it must be understood that each partner has a different
emotional outlook in money issues. ....
27: Ways About Investments
Everybody seems to
agree that investing in the stock market and real estate is one of the most effective ways to get rich. Your bank account
manager or a financial investment specialist is your starting point to create a portfolio. But let no one tell you exclusively
how to and where to invest your money; that is a decision you must make yourself based on individual circumstances. Again,
my financial advise is to keep it simple; If any market opportunity looks too complex, if you do not understand it, if you
do not see its potential, don’t invest on it. A simple everyday math and common sense is about all that is needed to
figure out a good investment.
How much money do you actually need to start up an investment plan? Nothing! Or very
little indeed if you consider the fact that almost every fortune in the world began with a ZERO balance. Thus, if you stop
spending, you will start saving… it will increase your income…then you start investing it…soon the interest
adds up …compounding months and years...
28: Creating a Business
If
you do not have your own business, you work for everyone else but for you: First, you work for the owners of the store or
the company who hired you. Then, you work for the government through paying all sorts of taxes, and you also work for the
banks and credit cards that lend you money. Our school system and our social structure teach and train everybody to get a
profession, secure a job and work for money. Let’s get out from this trap, open the back door of the old school, learn
to mind your own business and make money work for you instead.
Basic components of a classical business plan:..
29: Creating a Job-Business
You don’t need to
create a corporation or run a complete front store kind of business that requires a fully detailed operation. If you don’t
want the hassle, you can start working by yourself using the skills you already have by operating a sole owner business directly
from your home-office, by appointment at any time. While it is normal for people to find shelter and security working for
a salary, you do not have to continue in a job situation that you do not like. Get away from negative people, especially,
if you are working in a depressing environment surrounded by difficult people with a boss that no one respects or admires.
Request an amicable transfer, look for another job or quit before you get fired and create your own little business at home.
For starters, I recommend you to hold on to a steady day job for as long as you can: Don’t quit before you start
your own little business. Work patiently and continue to buy income-generating assets until your cash flow grows strong enough
to take the plunge....
Can you?.... Get a student loan and go back to school.
Barber-Hairdressing by
appointment.
Bookkeeping, accounting, public notary.
Desktop publisher, web & graphic design.
Direct buying wholesale and resale.
Flower arrangements and candle making.
Free-lance Photographer
and video maker.
Handy man repairs or general contracting.
Home and business cleaning services.
Home
computer repair and basic training.
Income tax preparation and public notary
Internet www.com. based
business.
Natural health sales and nutrition specialist.
Private driver, bus, truck, livery.
Private
investigator and case managing.
Private tutoring for K-12 students.
Professional sale-consultant in
any field.
Public speaker on any specialty subject.
Real estate sale, brokerage and investment.
Tour
guide to travel the world sale.
The list of self-operated business is open to your imagination depending
on your location...
30: Changing Paradigm
Most people act
and react within a paradigm (your mind-framed point of view), forged by the dualist tradition of good and evil, believing
that for every problem there is only one right answer and all others are wrong. Other paradigm believes that nothing is good
or bad, and that what makes an answer right or wrong are your personal moral limitations or perspectives.
If you
are struggling financially and sometime feel depressed because some how you have not achieve your intended goals, get up and
move out of despair. Look at it through the paradigm of a 360 degrees mirror and say to yourself ‘get over it’.
Most of the problems you think you have are holographic projections from your mind. Thus, if you could change your mind-paradigm,
one half of the problem can be solved in a heart bit. The other half of the problem is somewhere outside of yourself, and
nothing out there is ever so bad that there is no an alternative solution.
Consider another paradigm in which problematical
situations are not created by you or by fate but are the result of collisions between physical and mental forces from at least
three main sources: a) your thoughts and actions, b) other people thoughts and actions, and c) the chance and laws of the
natural environment. We learn to solve problems by trial and error, and every new challenge you might encounter gives you
an opportunity to learn and improve your future decisions....
31: Retire and Restart Your
life
A 63 years old man finally got his long dream of getting a private pilot license and retired. You know how almost everybody
has a dream in which they are flying? He said. “Well, I realize that flying low in a small plane is as close as one
can come to the dream of flying in this life”. His advise on retirement: “don’t vegetate, make a plan, keep
going and stay active”.
By age 50, I recommend you to start using your retirement benefits or re-tart your
life with less working and more living. If you read the previous sections, you should have started saving and investing already.
Start your retirement plan by determining exactly what you want to do for your later years today, and work smart to achieve
your vision of security and comfort for tomorrow. No one is getting younger, the earlier you start planning your retirement
party the better for you and your loved ones.
...In his book, Retire on Less Than You Think, Fred Brooks recommends
a cool life with fewer possessions and less responsibilities. Picture yourself living a simpler life, which can be psychologically
and financially liberating starting today: Try cutting off unnecessary every day activities that will save you time and energy
to relax.
What do you think you really need?
32: Don’t Wait for Retirement
A series of unfortunate events prompted me to change my mind, write this book, get rich and retire
early. ...more
....Here is what
I told myself as a first step for immediate retirement: Pack your luggage my friend, you don’t have to wait until you
are ‘too old, depressed, tired and broke’ to retire.
...Those who want you to hold on until
your 65th birthday are insane. In the faceless bureaucracy where you labor, no one really cares whether you diligently work
downstairs or hide somewhere.
...If you were lucky to make it to your 50th birthday, you ought to change the slave-setting
paradigm of job captivity, work less and start your retirement by next Friday...
33:
One-Liners to Succeed
We must be aligned with nature for we can’t change the natural forces,
we must respect others for we can’t totally control people’s actions but we can surely change our ways, think
out of the box and look at the big picture from inside our mind. Let’s use some of the following directional one-liners
to start up an internal dialogue. Argue, explain, rationalize, edit and rewrite it until you agree with an idea then add your
comments to form your own supporting principle for happiness and overall success:
1. Open your mind to new learning
everyday and change your life.
2. Use your skills and knowledge to create opportunities for you and others.
3. Smile and be genuinely interested in other people.
4. Team up and network with positive, proactive,
successful people.
5. Maintain loving relationships: give it, get it and share it.
6. Respect other
people’s points of view, belief and opinions.
7. Know the difference between wants and needs.
8.
Talk about and correct your mistakes before criticizing others.
9. Face reality, forgive the past errors and move
on to the future.
10. Choose careers & activities that point to the direction of your goals.
11.
Do the best with what you have, from wherever you are.
12. Fill your mind with positive thoughts and visualize
your success.
13. Take care of your health and rest before you get tired.
14. Prepare to accept the
possibility of failing and do not worry.
15. Take a chance and live your life wide open one day at the time.
34: How to Ruin Your Financial Life
If you respond to
stimulus by reverse psychology, forget all the positive advise given in the previous pages and consider the following counterproductive
commentaries based on Ben Stein’s book ‘How to Ruin Your Financial Life’:
1. If you want to ruin
your life: Quit school and don’t bother to learn anything. ...
2. If you want to ruin your life: Be a dreamer
who believe that you can get something with nothing down, and that you can get rich quick ...
3. If you want to
ruin your life: When you are earning money but getting your finances together seems too difficult at any given time: Don’t
bother to keep records or pay your taxes,...
4. If you want to ruin your life: Start a business without a plan ...
5. If
you want to ruin your life: When you have a bad business and you are wasting time or losing money: Keep doing the same stupid
thing you were doing anyway ....
6. If you want to ruin your life: Spend as much as you want and save money only
when you feel like, and if you don’t feel like, then don’t save anything at all.....
7. If you want
to ruin your life: Rest assured that shopping anytime is a valid form of emotional therapy and physical exercise....
8. If you want to ruin your life: Do not buy a home and continue to pay high rent ....
9. If you want to ruin
your life: Break up your loving relationship and marry an abusive man or a very stubborn woman with really expensive taste
and reckless financial habits...
10. If you want to ruin your life: Prepare for heaven and join a fundamentalist religious cult..
If you
do not want to walk-the-walk on any of the previous path to wealth or none of the get-rich-quick schemes seems to work for
you, don’t worry. You probably don’t need that much money anyway. Whether you realize it or not, you’re
quite wealthy already. All you might be lacking at this time is just a little more cash, but be careful while you’re
searching for more money, you may be overlooking things that are worth a whole lot more: Like your mental health and family.
35: This is It!
Congratulations! You have read almost 80% of the
financial blueprint necessary to achieve financial independence in the months and years ahead. Your 20% job is to put these
ideas into action and continue your own life-long study program. Do not wait a minute: make your next move to get the things
you want because from now on, you are on your own!...
You may want to add your new ideas here, check out the additional
references and visit my website at: www.RichTeacher.net to find links to other reading materials. If you want a copy of my book or if you have any financial question, write
me a letter or an email and I will do my best to reply as soon as possible.
Dr. Fran Detower
29 Adrian Avenue
A-5
Bronx, New York, NY 10463
Fgart44@hotmail.com
USE PAY-PAL OR SEND CHECK FOR ANY AMOUNT $5.99 TO $14.95
37: References
You can get my book for only $10.00 or spend over
$1,000.00 to buy and read some of the following 40+ books used for this special edition .
Allen, Robert G. 2002. The One
Minute Millionaire. Harmony Books. N.Y.
Allen, Robert G. Creating Wealth (with Real Estate)
Allen, C. W. Incorporate
and Grow Rich. Sage International.
Bach, David. 2004. The Automatic Millionaire. Broadway Books. New York
Bach,
David. 2004. Start Late and Finish Rich. Broadway Books. New York
Brock, Fred. 2004. Retire on Less Than You Think. Times
books. New York
Chatzky, Jean. 2004. You Don't Have to Be Rich.
Chatzky, Jean. Pay It Down. Portfolio. Penguin
Books.
Creative Real Estate Online. www.creonline.com
Clason, George. The Richest Man in Babylon. Penguin Books.
London
Covey, Stephen. 1997. The Seven Habits of Highly Effective People. Franklin Covey Audio.
Edelman, Ric. 2004.
The Truth about Money. Harper Business. NY.
Franklin, Benjamin. 1756. The Way of Wealth. Poor Richard Almanac.
Fred
Brooks, 2004. Retire on Less Than You Think. Time Books. NY.
Getty, J. Paul. How to Be Rich. Berkley. New York.
Hansen,
Mark & Allen, Robert. The One Minute Millionaire.
Home School. 2005. Learn Anything Online. www.homeschool.com.
Khalfani, Lynnette. Zero Debt. Advantage World Press. NJ.
Kessler, A. D. 2003. A Fortune at Your Feet.
Mackay,
Harvey. 2004. We Got Fired. Ballantine Books. New York
Hill, Napoleon. 1960. Think and Grow Rich. Ballantine Books. NY.
Kiyosaki, Robert T. (1998). Rich Dad, Poor Dad. www.richdad.com
Morris, Kennetth & Siegel, Allan. Guide to Understanding
Money & Investing. NY.
Mundis, Jerrold. How to Get Out of Debt and Stay Out of Debt.
Orman, Suze. 2003.The Laws
of Money. Simon & Schuster Inc. NY.
Peale, Norman. 1992. The Power of Positive Thinking. Simon & Schuster. Audio.
New York.
Quinn, Janes Bryant. 2004. Making the Most of Your Money. Simon & Schuster. NY.
Robbins, Anthony.
2004. Unlimited Power. Simon & Schuster. Audio. New York.
Small Business Administration at: www.sba.gov
Somavia,
Juan. Working out of Poverty, Report of the Director-General, International Labour Conference, 91st session, International
Labour Office, Geneva, 2003.
Tracy, Brian. 21 Secrets of Success. Audio series.
Tracy, Brian. Getting rich Your
Own Way.
Trump, Donald. How to Be Rich & The Art of the Deal. New York.
U.S. Center on Budget and Policy Priorities,
2003.
U.S. Census Bureau, Dynamics of Economic Well-Being: Poverty 1996-1999, July 2003.
U.S. Department of Agriculture,
Household Food Security in the United States, 2002, 2003.
U.S. Census Bureau, Poverty in the United States: Current Population
Reports, Sept. 2003.
Winget, Larry. Shut Up, Stop Whining & Get a Life.
Wall Street Journal Online. www.wsj.com
Copyright by
Dr. Fran Detower, 2005.
