Robert T. Kiyosaki co-authored a book titled Rich Dad, Poor Dad. It is required reading for everyone who wants to be successful. If you are one to read, you will acquire boundless information from this book.
One of the important points Kiyosaki makes in his book is that you should have money coming in from different sources. He notes an individual living a life as taught in school would be working one career job. There’s nothing wrong with that, as long as you have a lot of money put away for any financial catastrophe that comes your way. In other words, a person working one job with one income is in deep trouble when he or she loses their job.
Someone with income from different avenues, however, does not suffer a crushing blow when one income trail ends. There is a slight adjustment and life goes on. They soon figure out how to replace that lost portion of their monthly money.
It will take some time to figure out what work you want to do and then create the vehicle allowing you to turn your efforts into money. Once you start making money, you then have to determine how best to use the money.
The way to use money properly is just as important as making it. You must remember that for every dollar you make, 20 to 30 percent will go toward taxes. Of the 70 cents remaining, you need to save 10 percent. That leaves you 63 cents to live on. It doesn’t seem like much does it? Well, it’s not. Especially if you are working a low-wage job. If you’re working at minimum wage, then you are in more dire straits. The key is budgeting.
After you pick up your paycheck, the first person you need to pay is yourself. That ten percent we were talking about saving is important – more so than you can imagine. In many ways, saving is the key to success in life.
Someone who starts out working at a minimum wage of $7.25 per hour and manages to live on $5.07 is working miracles in this day and age. Out of their $7.25, they pay the government about 15 percent bringing their net to $6.16 per hour. If they save 62 cents out of that, this will amount to $100 per month. This is, of course, not much, but it is a start.
Keep in mind, whatever the wage, 10 percent first goes into savings and the remainder pays the bills first, and then buys any extras you might want. Over time, you will be pleasantly surprised at how well your savings accumulate. This is especially true once you get out of the lower wage range and start making more money.
Real wages are sometimes elusive, especially for those who lack imagination and the will to learn. For those who want it all, though, it is there for the taking.
The key is not working for money, but having money work for you. It is a simple concept, one not taught in school. You have to learn this concept through the school of hard knocks or you have to have someone show you the ropes. Or you can take the easier route to knowledge – you can read about it.
Most who graduate from high school and some who graduate from college think you have to get a job to make money.
There are only so many hours in a year that you can work. The standard job worked 40 hours a week amounts to a total of 2,080 hours per year. Take that number and multiply by your hourly wage. At $10 per hour, that is $20,800 a year; $100 an hour gets you $208,000. Now, here’s another important concept: if you are working for someone, they are probably going to want a lot more out of you than just 2,080 hours a year.
If you want to make money, you have to stop thinking in terms of “per hour,” “per month,” or “per year.” You should change your thinking to “what can I make per deal, with this idea, or that challenge.” It takes imagination and vision. It takes smarts – street smarts and book smarts, combined.
Instead of thinking about how much you have to make per hour to survive a year, ask the question how long can I live on the money I made off that least deal?
And here’s the trick: by reading, you will know the answers to all those questions.
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© 2010 J. Clark
I’ve always wanted to read that book. Now I must check it out!
Really is a good book; wished I had read it in my twenties.