- The 80 20 Rule Explained (a.k.a. Pareto Principle) | Brian Tracy
- Income Inequality: What’s the Right Amount?
As each new opportunity appears, you can react on a larger scale than your previous investments. It's when the interest, dividends, and capital gains your money has earned begin to generate their own interest, dividends, and capital gains, and on and on in a virtuous cycle. Commentator Larry Kudlow pointed out one of the great truths years ago when he said that profits are nothing more than margins times revenue.
The profoundness of that statement is sometimes lost by its simplicity. The only way you can have more money left over at the end of the month is to either increase revenue your paycheck, business sales, billable hours, or whatever it is that provides funds to cover your bills or decrease costs. That's it.
Write it down. Frame it. It's that remarkable. Your choices are to increase revenue, cut costs, or both. Not all income is equal.
An illustration is in order. Yet, if he had earned the same amount from within a pension plan or IRA, he wouldn't pay a single penny in taxes. This is why you should do everything you can, within reason, to fully fund your retirement plans, as well as to focus on how your seemingly small decisions help or hurt tax planning. No decision is too small.source url
The 80 20 Rule Explained (a.k.a. Pareto Principle) | Brian Tracy
Many people factor in control over their time when considering their wealth. Having complete control over your time is often one factor of achieving financial independence. You may not have totally reached the investing goal that allows you to maintain your lifestyle without an additional paycheck, but having total control over how you spend your day can be a variable factored in to how you define wealth.
If each morning, when you show up to the office, or the job site, or the practice field, or studio, it feels like you are unwrapping a Christmas gift—then you are successfully on track for achieving financial independence. If you find the profession that gives you that feeling, and you are disciplined in your management of the business side of it by controlling costs, you have a huge advantage over your competition because you may continue to work 10, 15, 18 hours a day or 2, 4, or 10 years longer, not because you need to, but because you love the process and product itself.
According to decades of extensive research by Thomas J. Stanley, Ph. That's not to say education isn't important—it is! More than 90 percent of American millionaires did, in fact, graduate with an undergraduate degree. Why then, do parents, teachers, and counselors continue to tell children that they won't be successful if they have a C- grade point average? Statistically speaking, according to Stanley, it's because often these people are themselves not financially successful.
Therefore, they have no idea what it takes to achieve financial independence and buy into the great myth that good students go further in life. They pitifully measure analytical intelligence only and not the creative intelligence that is responsible for sparking innovations, societal advancements and the opportunity to craft solutions in niche markets that everyone else misses.
They also fail to realize that most millionaires wear blue jeans, overalls, or work shirts, not a suit and tie.
Income Inequality: What’s the Right Amount?
They eat McDonald's and Burger King. They live in ordinary, well-established neighborhoods.
Most own their own business. Statistically, if you want to guess who is going to be wealthy and financially independent, you'd be more likely finding a self-sufficient student in wood shop class who paid for his own car, gets decent but not spectacular grades, has a job and enjoys what he does than selecting someone from the honor roll. It's counterintuitive, but it's often true. No matter how successful you are, unless your spouse is equally disciplined, frugal, and investment-oriented, your efforts toward a better, financially independent life are going to be like struggling in quicksand.
Marry the wrong person and the emotional, financial, and social toll it can take on your life will overwhelm almost any progress you can make in your career or pocketbook. As you try to build a life, he or she will be out spending your money, making it nearly impossible for you to achieve financial independence. To truly build a life, you need to have the kind of support that allows you to take risks because you know, no matter what happens, there will always be someone waiting for you at home who loves you unconditionally. It may sound surprising, but a tremendous amount of success is based on proper temperament and psychology.
How can you focus on your work and creating the life you always dreamed of if you are worried about the situation at home? Often, these niches are extremely lucrative but not likely to win you friends at cocktail parties. Conjure up images of a multi-millionaire. What do you see? High-tech somethings on a yacht? Molecular biologists? Although there are a few, most of the big money is in industries such as waste management garbage , pizza, clothing stores, trailer parks, candles, and shipping.
There's nothing sexy about selling cent flip-flops and bottles of cheap cologne in small towns, but Walton was on a mission to bring affordable goods to everyday Americans.
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He was a man possessed with vision. What can I do differently or better? How did I plan to adjust my behavior going forward? I admit, it was a habit that I found difficult at first. I had always seen reflection as something I wanted to do when I felt like it, not something I wanted to be forced to do. Most importantly, this kind of structured reflection provided me the space to deal with setbacks and struggles.
In the past, when something like this happened, I relied on sheer effort and discipline to get back on track—which never really worked. When I was forced to change my environment, it became easier to bounce back from whatever it was I was struggling from. Yes, for some people, focusing on that single outcome is what drives them to deliver day after day.
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