Chapter One
LET''S GET STARTED
Take care of your money when you are young, and your money will take care of you, as you grow older.
The first thing you have to do is to believe that you deserve to have whatever it is that you desire. Everything begins with the mind. Check this out! Whatever you think about, that is what you are going to be about.
So keep telling yourself over and over again whatever it is that you desire to have, until your mind accepts it. The next thing you have to do is exercise faith. For example, you decide to buy a house. I am assuming that you believe you deserve to have a house and have gotten your mind to accept it. Faith is governed by observation and teaching.
You have to go and check the house out, talk to people that own a home and ask questions such as, how much money you need to put down? What location or area is best? Which bank is more reasonable? And what are the benefits of buying a house? And if you are serious you will own a home. I choose having faith to buy a house for this reason: To get the maximum performance for your money. Start with a house.
When you apply for a home loan, the bank gives you options on what type of loan might fit your needs. The three typical ones are fifteen years, thirty years and forty-year loans fixed or variables. If you decide to take the fifteen years loan, the benefits are, you will save money on interest, build up equity faster, and your home will be paid for in fifteen years.
For example, you decide to go into business a few years down the road. By taking the fifteen years loan the equity you build up in your home will provide you with extra money if you need it.
But, if you decide to take either the thirty, or forty years loans your monthly payments will be lower than the fifteen years loan.
Take the extra money that you would have been paying on the fifteen years loan and put it into a No Load Mutual Index Fund.
The difference between a Load Mutual Index Fund and a No Load Mutual Index Fund is, when you get ready to trade a Load Mutual Index Fund you have to pay a commission. With a No Load Mutual Index Fund you do not have to pay a commission when you trade.
By putting your money into this type of fund, you will cover the entire stock market. And you will have a balance or stocks and bonds.
It is not like choosing one individual stock. The index fund over a period of time will grow into a significant amount of money. Always keep in mind, there is more than one way of doing things. These are two ways of getting the maximum performance out of buying a home.
Chapter Two
BUYING A HOUSE TAKE ACTION
Therefore, it is important to have good credit, because the bank is going to check your credit score.
The credit scores range from three hundred and fifty to eight hundred and fifty. And the lower your credit score is, the higher your interest rate is going to be. You will need to have two years or more on a job and in most cases a down payment.
The idea of trying to get something for nothing does not work.
Chapter Three
TAKING ACTION!
Theory is a plan or scheme existing in the mind only. Theory is twenty-five percent and fundamental skills is seventy-five percent. And if you have a plan, but do not take action, you basically waste your time. Fundamental skills mean that you have to function, take action, and carry out your plan. Action always speaks louder than words!
You can read all the books on finance and nothing is going to happen until you make it happen. Remember this; the key to financial freedom is saving. Start saving by living below your means and not within them. When you live below your means you will have extra money to invest. But, when you live within them, you will only have money to make ends meet. To become financially successful, you need extra money to invest.
Chapter Four
SETTING GOALS
Set goals and the time that they are expected to be met. And find ways to support your goals by being creative, and surround yourself with positive people. Positive people are your friends because they will keep you going, when you feel like giving up. Have confidence in yourself, and think big but start small. Because, if you take on something larger than your mind can accept, you are definitely on your way to a let down.
Therefore start small, and every time you meet your goal, reward yourself. This type of action will motivate you and give you confidence to get your wheels turning. And the more goals that you reach, the faster your wheels are going to turn. When you have confidence; you are more comfortable with making decisions. Being comfortable and having confidence in the decisions that you make, is very important.
Chapter Five
KNOW WHAT YOU WANT
Knowing what you want lies the very foundation for every plan. For example, you go to a dealership to buy a car but, you do not know what kind of car it is that you are looking for. The sales person can sell you anything, because you do not know what you want. This kind of action can be avoided through research. So do your homework in order to have a clear picture of what you want.
You probably have heard that you need to own your own business to be financially successful. But this is not true. It takes time to reach the level of financial success. As a matter of fact, we are already in business, in business of course, for ourselves. Now that you realize you are in business, the better off you are going to become. Better off, as in money.
Chapter Six
MINDING YOUR OWN BUSINESS
You are the CEO and your job is to be in charge of day to day operations. If you have a family, you have to delegate some things out. For instance, setting goals and expecting them to be carried out and met on time. And if your employer offers a retirement plan, get into it and put as much money as you can afford into this plan.
Especially put money into a Four O One K Plan. Because the money that you are putting in, is before tax dollars and the employer usually matches your amount up to six percent. Before tax dollars means, you are putting money into the plan before any taxes are taken out. And you do not have to pay taxes on that money until you get seventy one years old. That is when you are required to start withdrawing by Law.
At fifty nine and a half, you can start withdrawing and will not have to pay a penalty. You can also put up to twenty thousand five hundred dollars a year in, if you are fifty years old or older. And fifteen thousand five hundred dollars a year if you are younger than fifty.
CH7[ FOUR O ONE K PLAN
With this plan, you can take a loan out up to fifty percent of whatever amount of money you already have in and pay yourself back, plus interest. However, there is a catch to it. The bottom line is, you are paying taxes on the money twice. You pay after tax dollars on the loan, and again when you take money out at fifty nine and a half. ]CH7
CH8[ PAY YOURSELF FIRST
Your goal should be to save ten percent or more of your savings. Or the first hour you work each and every day. So, if you are already in a Four O One K Plan, try putting in ten percent of your earnings. But if that is not possible, try six percent so you can receive the six percent the employer is offering. Or whatever other percentage they are offering, because this is free money.
If you cannot put in the employer matching offer, put in whatever you can. The important thing is to get started. The idea is, to get into the habit of saving. Remember that you are in business, and you are the CEO. So you have to create ways for your company to grow. And in this case, you need more money in your savings plan. ]CH8
CH9[ BE CONSISTANT
Simplify everything, automatically have your savings taken out of your pay check before you get it, so you will not be hitting and missing. The idea is to be on target.
If you do not have a savings plan at your job, go to your bank and have them prepare to have your savings automatically taken out of your checking account. Put this money into a No Load Mutual Index Fund; your banker will gladly help you with that. ]CH9
CH10[ WAYS TO GET YOUR COMPANY TO GROW
Put all of your wages, increases, or bonuses into your savings plan until you get to the percentage you want. Another way is, to take on a part time job.
By the way, you are going to need more than one income to arrive at financial freedom, so get use to long hours. Taking on a part time job is a good idea. It is extra money, and if you decide to become an entrepreneur, it will be to your advantage because you are already use to long hours. 0
CH11[ HAVING THE RIGHT ATTITUDE
For an example, an owner of a grocery store has to decide when to open up and close the store.
If the owner is not ambitious, he will open the store up at, let''s say, nine o''clock and close at five. With this type of attitude, the owner will limit his or her earning power. But on the other hand, if the owner has a creative attitude and says something like this: "I am going to open up early in the morning and close late at night including weekends!"
It is obvious the owner is willing to work harder and is a smart thinker who knows how to create more earning power. There is nothing lucky about that. The owner just thought of a way he or she could earn more money. What you think about, that''s what you are going to be about. 1
CH12[ YOU REAP WHAT YOU SOW
The forty hours work week is a joke to a person seeking financial success. Whatever you put into something that is what you are going to get out of it. If you put a little into it, you are going to get a little out of it.
But the more you put in it, the more you will get out of it. And if you put nothing in, you get nothing out.
You have to do what it takes to get the prize. Anybody can talk a good game. But talking a good game doesn''t mean anything.
You have to show up, and do what it takes to win. The money game works the same way. If your mind does not show up, you cannot win. The number one golden rule is to show up! Get your head together my friend, and have an open mind.
Do not let the first problem you encounter give you an excuse to quit. Problems will arise and many times, they seem insurmountable, but they are not. Think about the problem for two or three days. You will be surprised at the way a new day can bring a simple answer to a perplexing problem.
Clear your head up from myth and negative sayings. For Example: "I am just trying to make ends meet!" Trash that, clear your mind, think positive and say something like this:
"For every end that I meet, I am going to make them lap around!" 2
CH13[ THE LAW OF CAUSE AND EFFECT
Nothing happens by chance.
Whatever effects you get out of life, something caused it. This law is known as the law of cause and effect. Everything on planet earth works by this law. Therefore, if you do not like your position in life, go back and find out what caused it.
Nothing is going to happen until you make it happen.
Quit blaming others for your mistakes. Start being responsible, be honest with yourself, be strong and tell yourself "If I don''t succeed, it''s my own fault!" This is what makes you grow mentally. If you keep doing the same thing, you are going to get the same results. Take time and think about your goals and act on them. And you will get a reaction. Nothing ventured, nothing gained.
In the game of golf, it''s not how long you drive the ball, but how many strokes it took you to arrive, that counts. In the money game, it is not how much money you make, but what you do with the money, you make that counts. 3
CH14[ RESPECT PEOPLE
You have to respect people and treat them like you want to be treated. Do unto others as you have them do unto you. This is a commandment, if you act contrary to this commandment, you will pay the price. Because word of mouth is the best type of advertisement. If you practice being dishonest and mistreating others, sooner or later the word is going to get out. Keep in mind that you are in business to make money. And with this type of behavior, you are going to either hurt your business, or go out of business.
Do not be hardheaded and think you don''t need anybody. We are all depending on each other. Take for instance the cars we drive, we didn''t make them! The roads we drive on are laid out by others, and so forth and so on. Trash negative sayings like, money makes the world go around. People make the world go around.
Money does not have a mind. But you my friend has one. So be careful of whom you listen to. If you listen to a fool, you will be a fool. Do not be a victim of circumstance start thinking.
God is not in business of dropping money out of the sky. And there is no pot of gold at the end of the rainbow. All money comes through people. And to become financially successful, you have to be value driven. Respect people because, that is the right thing to do. People have control over money and if you plan on getting your share of it, act like you know! And learn by other people''s mistakes.
Experience is a teacher but, not always the best one. For Example:
You are driving down a road and see a sign that says speed limit twenty five miles per hour sharp curve ten feet away.
But you ignore the sign and keep driving at your normal speed and end up not making the curve. You have an accident and get hurt.
That was not the best thing that could have happened to you.
Being disobedient will cause you to suffer, waste valuable time, and in some cases cause you a fortune. 4
CH15[ HOW TO ACHIEVE YOUR GOALS
Take charge, have a positive attitude, have confidence, faith, a clear vision, and be persistent and determined. Take for instance: Aircraft pilots cannot visibly see where they are going. So they have to rely on their aircraft instruments and do certain things to prepare them for any type of an emergency situation. In order for them to arrive at their destination safely and on target. In order for you to meet your goals, and be on target, exercise faith. I am not talking about the faith that waits. I am talking about, that faith it takes. Question your goals by asking: Will this help me to become my best? Stop procrastinating and wasting time.
Time is money and every minute counts. Time does not discriminate, it moves at the same pace day after day, year after year and it waits on no one.
Time is neutral; you can make it work for you, or against you, and when it''s gone, it''s gone. You have to sacrifice in order to achieve financial freedom. In other words, giving up something such as, spending valuable time watching television.
Be creative by programming the shows that you enjoy, and watch them in your spare time. Do not let the TV control you. You are the person in charge. As a matter of fact, you are the CEO.
Therefore, handle your business and do not concern yourself with what others think about you, because you do not have any control over how a person thinks. The only thing you can control is your behavior. Take a positive attitude by telling yourself,
"There is no way I can lose with the stuff I use, because it has already been approved." This type of attitude is demonstrating confidence and believing in a higher power.
Start by making your goals spiritual in the beginning, by thinking about them and seeing yourself with whatever you desire from the beginning to the end. In other words, have a clear picture of what you are after, and believe it is going to come to pass. Go to bed with your goals in mind and wake up with them, on your mind. When you are on your job think about your goals, get them inside your head, and remember, that your goals have to be spiritual before they can become material. The bottom line is: "No goals, plus no rolls, equals, no gold!" 5
CH16[ HAVE AN AGENDA
Make a list of what you want to accomplish.
Put down what it is that''s the most important to you. First things always come first, then go to the next one, and then the next one, and so forth and so on, until your list is completed.
This will give you a clear view of what you are after and the steps you have to make in order to get you there.
With this system, there is no reason to be jumping from one thing to another. When you have your head together there is no reason to play the game: "Where ever you lead me, I shall follow." The hell with what others are doing! You now have your own plan. There is no need for you to be a copycat. You have a plan, and can now do your own thing. The idea is, to get into the habit of being systematic. Have a system and do things in order.
By having a system, you will save time, accomplish more and accelerate to financial freedom. Setting goals is the right thing to do. Not setting goals is what gets you into trouble.
Doing more than expected is what separates the stars from the super stars. At your work place do more than expected. And be the best at whatever you are doing. Hanging around and seeing what you can get away with, and by being a difficult person, will keep you on the bottom level of the success ladder.
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Excerpted from MAXIMUM PERFORMANCE FINANCIAL FOR EVERYDAY PEOPLEby Herman Barnes Copyright © 2008 by Herman Barnes. Excerpted by permission.
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