The final solution to all "I have some money what do I do?" threads.

[DeletedUser394]

I really want to order delivery for the dozenth time in the last week or two.. but this thread is stopping me. Damn, guess I'm going to see what I've got in the pantry lol.

Transferred $25 in internet dollars, since you saved me $25 tonight!

 

[RHL]

Value pays

And there's the TL;DR for the thread.

 

[Guest]

I thought the thread started off saying make the right choices by leveraging money.

It's a fact of life that almost universally, construction is more protracted and takes more effort than destruction. A building that took 20 months to erect can be dynamited in two weeks. Money you saved up for 9 years can be blown in one weekend. Sure, you can begin processes that lead you on a slow descent towards failure, and some constructs are so resilient (ex. an athletes body, a billionare's wealth) that it would virtually always take a process rather than an event to undermine them, but when you're just starting out, which is what this thread is about, an event can definitely take you out of the game.

It's a universal law that everything must remain in equilibrium, aka the law of conservation of energy, aka the first law of thermodynamics, aka maximum entropy. It takes just as much energy to build something over time as destroying it over the same period of time at the same rate. You are comparing events of different states. Another way of saying it is you are comparing micro events to big events. I'll use your examples.

A building that took 20 months to build brick by brick will probably take 20 months to take down brick by brick (same state). But a dynamite is concentrated energy (different state). I think @MJ DeMarco calls this magnitude in his book when talking about price and cost.

The next time you drive think about how 1 gallon of fuel is moving several tonnes of steel for dozens of miles. It's not just 1 gal of any liquid, it's 1 gallon of concentrated solar energy and Earth's gravity over millions of years.

The guy blowing his 9 years saving over a weekend must have spent it on something of gargantuan magnitude greater than his savings. Likewise with the billionaire, it's just a matter of $$$ amount.

The choices that you make also contains within it scale and magnitude. But unless you are making a billion dollar decision (magnitude), the many little choices that you make in deciding what to do with your money will eventually lead to big things (scale).

 

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[RogueInnovation]

$25*12=300 just in the last "week or two." Nobody ever became obese from one order of fries, or an alcoholic from one drink. If $25 is part of a good process that leads to saving $600+/mo, it does matter a great deal

I see it like castling in chess. People make a stupid move when there are foundational things begging for attention!

For anyone that doesn't get chess at all, I guess I'm saying it is like selling your winter coat in autumn, because the past 8 months you haven't needed it.

When you get to the root of it all, like Enaeka does, it is absolutely crucial that money isn't "traded down" early, but instead used to form strong foundations that can self generate.


You first hit a paralysis point (because your foundations aren't built well enough) before that foundation generates anything. Most people take that as a failure in approach, and start SPENDING, but if you keep piling up the torsion in your foundation, it starts leaking and bleeding cash out of its cracks, into your pockets.

And when that happens, you take a breath and just relax, clarify your mind, and destroy the last of that stupid spending attitude. You start telling yourself what you need, rather than letting money tell you what you need.

You become the eye of that storm, and let all the logistics go to battle infront of you, as you figure out where the money will go and when.


To very slowly spend, and very quickly stir up opportunity is the only real way to stack things in your favor.
And holy moly does Enaeka ever GET IT.

Reading this was great, because it made me think even deeper on this point (and what a good one it is) you have to EXPECT paralysis, in order to not freak out, then you need to address the real issues and get the wheels moving.
Anything less is garunteed failure.


Use the resistance to your advantage, by getting REAL in your approach, and stop jumping at BS whenever you get the chance.
Hold OFF
Use the restistance to find the smarter move

 

[Bouncing Soul]

Agreed. I think that MMM has a lot to offer, but it certainly isn't fastlane stuff. That being said, there is a lot on his site that I've found to be helpful in challenging my mindset and helping me realize that by changing my relationship to money, I can make a lot more money.

I'd much rather scale my income up to live on 10% rather than scale my expenses down.

I see MMM as discussing defense, Millionaire Fastlane as discussing offense. One keeps you from losing the Superbowl, one wins the Superbowl.

 

[GWan]

View: https://www.youtube.com/watch?v=hjgN-K_b7nk

This is a great video by Dan Lok where he explains what you should spend your money on depending on your situation.

His concept is called the wealth triangle, which are 3 things you should have to reach financial freedom:

1. High Income Skills: Skills that can make you either $10,000/month or $100,000/year (Adds security and comfort). If you don't have this yet, then you should be spending your money on courses and books that will get you there.

2. Scalable Business: A business that can be grown with a good system and infrastructure in place. If you have high-income skills, then you should use the money to start a business.

3. High Return Investments: Investments that return 10% yearly returns (Builds net worth). For when you have so much money you don't know what to do with it.

 

[Vigilante]

Should be required forum reading. Speed +*4

 

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[Andy Black]

Nice imagery.

What a great litmus test to determine what lane you are in mentally. If you had $100 would you think what you could spend it on, or what you could invest it in?.

 

[RHL]

>Just to be curious, what do the $7.000 stand for? The money you want to spend, but you didn't, because of this thread?

I think so.

Just to compare notes, since I wrote this, I eliminated about $9.00-12 in daily spending on take-out and other nonsense (used to spend about $2.70/day min on coffee, now I don't drink it at all. It sickened me how many pain killers I had to take to come down from caffeine totally). To date, I've saved about $2,300 on useless stuff. RK is still kicking my a$$, but it's something.

 

[RHL]

Reminds me of this article by Mr Money Mustache in which he suggests that you offer yourself a catheter and a bedpan as a substitute for consumer purchases that you think will make your life more comfortable/convenient.

Yeah. I was influenced by his thinking early on, and I think that if you take the time to sort through, there are some great EVENTS there that can set off passive PROCESSES of savings, but I eventually decided that I didn't want a life where I was dosing my kids food with olive oil (something he suggests with a straight face) to make an offering of rice or beans that doesn't meet the minimum daily requirement for calories reach that point. Whenever I hear MJ talking about retiring young by cooking roadkill, MMM is the first thing that comes to my mind.

In that article, MMM states that new readers to his blog ask:

“How could I possibly live on 50% of my income? Or 25%?”

Which he says is the right kind of question, but too rigid, choosing instead to embrace a lifestyle that needed few material frivolities.

I asked the question in reverse: Rather than trying to live on 25% of my income, why don't I just increase my earnings so that my current salary is 25% of my future income?

 

[MJ DeMarco]

Low cost ETFs or dividend paying stocks.

I still prefer muni's... but even idle cash in a money market earning ZERO still equates to a perpetual option on choices.

 

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[DaRK9]

This guy knows it...

This guy in the comments didn't

"Ok so you told us what you do, but what is the best salary to be able to afford expensive cars or be able to feel rich. Is it not until you are making 100k or is it at 80k or even lower?"

Amazing, that phrase 9/10 would be sarcasm here.

 

[MJ DeMarco]

Holy $h1t at the picture of all that dough!

Yea, it looks like a ton of money (it's only about $8K) which is why I do that. It gives perspective to effort and their corresponding results. Without making it tangible, I'm left with a number of a computer monitor which feels, dare I say, distant and fake.

 

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[Kak]

I really want to order delivery for the dozenth time in the last week or two.. but this thread is stopping me. Damn, guess I'm going to see what I've got in the pantry

Transferred $25 in internet dollars, since you saved me $25 tonight!

Ok... There is a difference between building your wealth and being a cheap a$$. If $25 means that much you should probably be trying harder.

 

[mayana]

First read of this thread, wow!

I've been getting rid of a lot of crap I don't need/use lately and putting that money to work for me (if you haven't used something for a year, sell it!).
But this thread has made me realise something, I spend too much money on unnecessary gadgets.

Really like what you've been doing in this thread @GrumpyCat, shows you how a mindset shift and a change in habits can create something much larger down the road.

People tend to have a lot of stuff, but not a lot of money. Get that money working for you and it'll keep working even when you aren't.

Agree 100%!

I personally went through a situation a few years ago that required my husband and I (and kids!) to temporarily reduce our belongings to two suitcases per person, basically, for practical and logistical purposes. If we wouldn't have paid to ship it or store it, it went goodbye. It's surprising to see all of the things that we amass, and kind of gross to think of all the money that has been spent on those things when, at the end of the day, they didn't mean anything to us.

After viewing life through that lens, material belongings are much less important to me, and even my goals in business shifted. If you focus on creation of income (using the Fastlane principles), then you can always have the things that you need and want. If your focus is on stuff, it's always about worrying where and how to keep it, taking care of it, and making sure that it's safe. Misdirected energy!

 

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[GoGetter24]

That video above about 3 stages is a great find, thanks.

That seems the best model so far. Most winners are doing that. Even in the cases of Musk & Gates, who never had a real 'career' and so skipped most of Step 1, they still gained the specific skill needed to start their businesses. And most men who's business doesn't have compelling need for capital start diversifying it out into real estate etc. Video really does match well.

I've seen guys online say stuff like "I'm trying to start a business, and nothings working and I'm going into the red, and I'm burning out, what do I do? Oh by the way I make $1k in my day job".

It's just the wrong way for 99% of guys. It violates the power law of business return (AKA hockey stick). With a high demand skill you have a much much more linear return -- you work for whichever business is still alive & profitable. Good salesmen will always be needed by someone, good designers, lawyers, etc. It's the lowest risk way to guarantee you're getting solid income in.

It's also the best stepping stone from job to business. Most people have to put up with a shitty job, shitty wage, and shitty boss because they don't have the power (marketable skills) to command otherwise. (The role jobs play in preventing them from reaching those skills is another topic -- corporations are rife with antisocial behavior)

If you get your skills strong & market yourself, people start to notice, job offers come in, headhunters call, bosses give you raises out of fear, etc. Your income increases, allowing you to store up capital faster. You, in pushing out at the margins of performance in a space, start to see unmet demands & solutions -- which could inspire a business play. You can also, with your reputation, become a sole contractor -- another step to becoming a businessman.

 

[Michael Raphael]

Love the passage and opinion you expressed very powerful imagery. Even more so, I loved that hebrew quote thrown into the siggy.

 

[Catalyst]

rep+

 

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[HarryR]

Yet another thread I wish I had when I was 18. MJ if you write a book for kids/teens someday with some of these lessons I'll buy a copy and teach any future kids i have to read with them.

 

[DeletedUser394]

Failures of process always come down to exceptions... exceptions that break the process and carry consequences.

Oh, it's only one cookie...
Oh, it's only one donut...
Oh, it's only one hooker...
Oh, it's only one snort...
Oh, it's only one car...
Oh, it's only 12 easy payments...
Oh, it's only a weekend...
Oh, it's only...

..and now it's only $7,000



Which represents about .76c/day in fully passive income. That's less than 1% of what I'm doing overall, but strictly from a 'conscious consumer' standpoint, this is how much I"m up from this thread.

Been keeping track in a separate account since this thread was started.

 

[GuestUser140]

“How could I possibly live on 50% of my income? Or 25%?”

Which he says is the right kind of question, but too rigid, choosing instead to embrace a lifestyle that needed few material frivolities.

I asked the question in reverse: Rather than trying to live on 25% of my income, why don't I just increase my earnings so that my current salary is 25% of my future income?

Exactly.

I remember MJ writing he lived on about $10k/m while earning $100k+. That's barely 10%!

Spending less and less money has a ceiling, earning more and more doesn't.

 

[Dicky Dee]

I 100% agree with this post, it actually took me a years to understand this because i use want to make a shit ton of money so i can buy exotic cars. Fast forward few years later after reading a few books(The Millionaire Fastlane included), finding this forum and losing 250k at the age of 25 when the recession hit it really dawned on me that wanting to make money just to consume isn't really the way to go about life.

Now i make money for things such as financial freedom at a young age (goal is before i turn 40), to have something great business wise that i can pass down to my family for generations to come long after im gone so my family does not stay in the slow lane and finally to actually have an impact in this world and not just die one day to have done nothing or contributed anything to this world of ours.

Some of my successful friends still haven't realized this and spend money on things like five 50k Hublot watches or something insane like that. Its good to have nice things but i mean what are you going to do? Pass down to your kids an expensive watch? Its pretty pointless to me buying those things in excess, you need substance in this world that actually means something.....you as a person need to be of substance and mean something.

 

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[DrunkFish]

Haven't read any replies but this is funny because this is exactly how I instinctively have thought about money I get from working at jobs ever since I was 17. People would be like "dude you DO have the money for X" and I'd explain to them how even though I have a job, it's not money that I should be spending on stuff like that unless necessary because I could be spending on it something that will actually make money instead of just take it.

The only "unnecessary" thing I buy is an iPhone every two years. Old car, cheap but good clothes, use my grandfathers watch... keeping it minimal until I have that freedom.

 

[splok]

I live in S. Korea and most of the popular Investment options arent available here.

Reading through the site here makes me kind of depressed.

This thread, and really this entire forum, is about investing our time and money into things that bring value to other people. The "popular investment options" are pretty much the antithesis to that. Luckily, the concept of bringing value to other people is universal, and even though the tactics will vary from place to place, the concept is the same no matter what country you live in. And even if you don't want to do business in Korea, we all have the same internet.

 

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[Michael Raphael]

Wishful thinking won't change anything. What's going to change in the next 24 hours?

That's all it takes is a wish. I first was on this site when I turned 17 and read this book. Since then the firm I spoke about 3yrs ago + (now) has grown just based off a wish and a couple one liners I read on this site.

Wishful thinking in my opinion is the only motivation you need to change the next 24 hrs of your life.

 

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[luniac]

By the time i have the income to quit my day job im going to be so scared of going back ill be afraid of spending any money at all...

 

[MJ DeMarco]

#50 on the GOLD list, time to bump back to #1.

 

[DeletedUser394]

I've been getting rid of a lot of crap I don't need/use lately and putting that money to work for me (if you haven't used something for a year, sell it!).
But this thread has made me realise something, I spend too much money on unnecessary gadgets.

Amen.

People tend to have a lot of stuff, but not a lot of money. Get that money working for you and it'll keep working even when you aren't.

 

[gurnays]

It was definitely the most potent idea of Rich Dad poor dad, but it really didn't sink in until I read TMF because it was explored outside real estate in such a comprehensive way. It all boiled down to the answer to this one question...

We see it on here all the time: "I have a thousand dollars, I have five hundred dollars, I have ten thousand dollars..." and the inevitable conclusions: "Should I go to school? Should I buy a car? Should I buy a boat? Should I blow it on a vacation?"

Reach into your pocket and grab whatever money you have. A dollar. A dime. Doesn't matter. Hold it and look at it. The difference between freedom and wage slavery, between working till you're old or retiring when you're young, is that you look at that, and stop seeing an opportunity to consume. When you have a little windfall and you're not in the fastlane, if you spend it on frivolities like a sports car or a cruise, you look as stupid as a fisherman who goes out to hook some blue fin tuna, but right as the school is swimming beneath his boat, he opens up the little tub of bait he brought along and starts shoveling the dirt and worms in his own mouth, greedily slurping down the little squirming maggots and telling everyone how awesome it tastes.

Meanwhile, 400lbs of prime seafood is getting away. Where are you? Choking down your little bit of dirt and tricking yourself into believing that it was worth it.

If you trade time for money, your money shouldn't be for consumable frivolities. It's not for designer clothes, or iPhones, or Sunday Ticket, or a Mustang GT. Shop at Wal-Mart or Marshalls, drive a $1200 Geo Metro, get a Republic phone, cancel your Netflix, and spend your money to get free. Even if you're really, really hungry, take that bait, hook it up, and get it the hell overboard. Let your stomach gurgle, you'll be eating good tonight.

Money is your best bet to earn more money. Until you're meeting needs at such a high volume that money is available in excess, the little bit you do have, whether it comes from a job or a lucky break from somewhere, should only be spent one way. There's only one fastlane answer to the question "I am in the slow lane and have X amount. What should I buy?"

Buy something to meet the needs of others.

Spend your money in a way that causes it to be multiplied rather than consumed.

Thank you for this. The last sentence just summed it up well. I will forever remember "Spend your money in a way that causes it to be multiplied rather than consumed"

 

[RHL]

how many people are doing that ?

i guess less than 20 % here

MRW: