Becoming rich or wealthy may be terms that sometimes may make people uncomfortable. I can understand that. Hollywood in the 80's helped make becoming rich a slightly bad word. How about another term that expresses doing the right things in a better light. How about Financial independence.
I watched an awesome video clip of Jim Rohn speaking on financial independence. His definition of financial independence is: the ability to live from the income from your own personal resources. At the time of him making this video he used a 20 year time frame but I think today it can be accomplished in 5-10 years.
It all depends on your philosophy. Philosophy in this case is the ability to gather the right information and put it into action. When it comes to money, there are only two philosophies. Rich and poor.
Poor people spend first and invest what is left. Rich people invest first then spend what is left. What's great about the rich way is that the amount of money doesn't matter. It is in the doing of things in the “Certain Way” as Wallace Wattles says, that will lead to financial freedom.
Here's a basic way to examine this philosophy. Depending your situation and philosophies, you may adjust these percentages to fit your goals.
Never spend more than 70% of your income for your expenses. Set aside 10% for some form of generosity. For some it can be charity or tithe. Use 10% as Active Capitall. Do something with your earnings to make a profit and acquire assets. The next 10% use as Passive Capital. This is money you let other people use. You help others acquire assets that they make a profit from and you earn interest for letting them use your money. That's letting your money work for you.
I don't have an issue with the terms rich and wealthy but I'm okay with financial independence too. If your current financial situation is not what you would like it to be, the power is within YOU to make the changes needed. The amount of money doesn't matter. You can't measure yourself with another person's yardstick. All that you want, you can achieve if you do things in the “Certain Way”.
Thanks for reading. Please comment and share.
“Building Wealth One Friend at a Time”
Thursday, September 2, 2010
Jim Rohn Budget for Financial Independence