24 Therefore whosoever
heareth these sayings of mine, and doeth them, I will liken him unto a wise
man, which built his house upon a rock: 25 And the rain
descended, and the floods came, and the winds blew, and beat upon that house;
and it fell not: for it was founded upon a rock. 26 And every
one that heareth these sayings of mine, and doeth them not, shall be likened
unto a foolish man, which built his house upon the sand: 27 And
the rain descended, and the floods came, and the winds blew, and beat upon that
house; and it fell: and great was the fall of it.
I.
VARIOUS WAYS PEOPLE
LOOK TO GET RICH
1. By
winning it.
The number-one way average, hardworking
people try to get rich in America? They play the lottery. Since 1964…Americans
have plunked down more than $500 billion on lottery tickets.
2. By
marrying into wealth.
A very small percentage of people marry
into money and most of them end up paying for it for the rest of their lives.
3. By
inheriting it.
There is a temptation to wish they leave
early….. :-)
4. Sue
for it.
II.
STEPS TO BUILDING
WEALTH.
Regardless
of the size of your paycheck, you probably already make enough money to become
rich.
1.
Develop a small emergency
savings.
2.
Retire Debt.
· Borrow money to
make money not to loose it.
· If
you pay just the minimum due each month on an $8,400 credit balance, you will
wind up having to make 365 monthly payments before it goes to zero. That’s
thirty years and five months’ worth of payments.
i.
Stop
digging the hole.
ii.
Find
out how much interest you are paying.
iii.
Ask
for a lower rate.
iv.
Consolidate
your debt.
v.
Rank
your cards.
·
Make
a list of the current outstanding balances on each of your credit card
accounts.
·
Divide
each balance by the minimum payment that particular card to get a payment
ranking number.
·
For
example, a card with a $500 balance and a minimum payment due of $50 will have
a rank # of 10.
·
Start
paying card with lowest Rank Number first.
3.
Buy a Home.
Benefits of Home Ownership
i.
Forced Savings.
ii.
OPM.
iii.
Tax Breaks.
iv.
Pride of Ownership.
v.
It’s a Great Investment.
TIPS
·
Go to
www.eloan.com and calculate how much you can afford to spend on a home
According to the FHA, a good rule of
thumb is that most people can afford to spend 29 percent of their gross income
on housing expenses—as much as 41 percent if they have no debt
·
Decide to pay off
early by making extra payment a year or increase your mortgage by 10% each
month,
·
Go to
www.bankrate.com and use its calculator to see how much you can save by making
your mortgage payments biweekly
4. Determine
your Debt/Savings/Investment Plan
Questions:
i.
Do I put all my available cash on Debt Retirement and
start saving when all my debts are paid off?
______________________________________________________________________________________________________
______________________________________________________________________________________________________
______________________________________________________________________________________________________
ii.
Do I save all that I need and then begin paying my
debts off?
______________________________________________________________________________________________________
______________________________________________________________________________________________________
______________________________________________________________________________________________________
iii.
Do I save while paying of debts?
______________________________________________________________________________________________________
______________________________________________________________________________________________________
______________________________________________________________________________________________________
5.
Save a Minimum of 3 to 6 Months
Income.
i.
You
should at least work one hour a day for yourself
If you are going to put in roughly 90,000
hours at work over the course of your lifetime (which is what the average
person does), shouldn’t you work one hour a day for yourself?
Let’s ask how much it will cost you if
you don’t Pay Yourself First. If you invested just $200 every two weeks for 35
years in a retirement account that earned an annual return of 10 percent, what
would you have? The answer is that you would have more than 1 million dollars.
Actually, a lot more. The exact figure is ________________
ii.
If you want to be:
·
Dead
Broke: Don’t Pay Yourself First. Spend more than you make. Borrow money on
credit cards and carry debt you can’t pay off.
·
Poor:
Think about Paying Yourself First, but don’t actually do it. Spend everything
you make each month and save nothing. Keep telling yourself, “Someday . . .”
·
Middle
Class: Pay Yourself First 5 to 10 percent of your gross income.
·
Upper
Middle Class: Pay Yourself First 10 to 15 percent of your gross income.
·
Rich:
Pay Yourself First 15 to 20 percent of your gross income.
·
Rich
Enough to Retire Early: Pay Yourself First at least 20 percent of your gross
income.
6.
Build for the Future.
7.
Automate Your Wealth
i.
Be as smart as the Government
The government is
pretty smart. It figured out years ago that people couldn’t budget, so it set
up a system to make sure it got “paid first.” Not only did the government
arrange to get paid first, it automated the process so there wouldn’t be any
slip-ups
ii.
Don’t focus on Budgeting alone.
There’s a very
simple reason why budgets don’t work in the real world. They aren’t fun.
Any system that
is designed to control your normal human impulses is ultimately bound to fail.
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