PART II of the Laws titled “HOW DO YOU PLAN YOUR WEALTH?” helped you plan for wealth.
Part III: HOW DO YOU CREATE YOUR WEALTH?
This is a ‘do’s and don’ts’ guide. With many of the basic principles time tested, these laws will teach you how to create and attract wealth using specific strategies and systems that bring results. They are so important that we will dwell a bit more on some of them.
Law 1: Teamwork: you need great people around you to help you succeed.
You need friends, family, coaches, mentors and advisors to help you grow and handle aspects of your businesses that you can’t do alone. The more you give them, the more they will help you make money. So don’t hesitate to add some kind of value to other people’s lives.
How can you add value to people’s lives? Even a smile to make their day or a financial offering and opportunity will do. To have a solid team, favour strong and trusting relationships with others and constantly seek to help them and add value to their lives.
Law 2: Take action now! You can’t build wealth on mere intentions.
Knowing what to do to change your situation and not doing it is worse that ignorance of how to progress in life. If action is the way to get results (intentions keep you in lethargy), consistent action however is the only sure way to achieve wealth and success.
How fast or how slow you act, which way you go or which strategy you employ are irrelevant; what counts is to continue taking action and be open to opportunities and growth. So do a little more each day and you will be on your way to wealth.
Law 3: Be Financially Literate: That is, speak and understand the language of money.
To be rich you must be financially literate, that is, speak and understand the language of money. Carefully choose the books and publications you read, the websites you visit and the people you spend the most time with. Master the language of finance, and you’ll be wealthy.
Law 4: Why you must be a ‘salesman’: Wealth is produced by sales.
Sales are one of the three skills necessary for attaining long term wealth and success. You need to be able to sell yourself, your ideas, via other people and other companies, on websites, in shops, at all prices with good margins, all over the world and even while you sleep.
Law 5: Adding value: Help raise other people’s lives and your wealth will grow.
When we add value (financially, by service or in kind) to other people’s lives, we earn more and our lives grow. In fact, the amount of our wealth is directly proportional to the value we give other people. Never forget: great results for other people mean great results for you.
Law 6: Leverage: Relying on the skills and talents of others to build your own wealth.
Leverage is depending on other people’s time, money and skill set to gain a greater advantage, result or wealth than you could do alone.
These are ways you can also leverage for wealth:
– Get experience from peers and bosses in your job.
– Hire a money mentor or business coach.
– Invest in property and pay your mortgage with a tenant.
– Use the internet to touch a greater audience.
– Get yourself a personal assistant.
– Use a spread sheet.
– Use a ladder, get a piggy back.
– Have a small business on the side of your job and nurture into a big one.
– Use drop shippers and copywriters.
– Join affiliate companies to get referrals and earn commissions.
– Do joint ventures to reach more people.
– Invest in property and shares [Law 39].
– Get professional help, but don’t forget your due diligence and your intuition. Look for people who have the knowledge and skills you need to be wealthy and successful.
– Get other people to do what you lack the skill to do.
– Be a great people person and never hesitate to offer great benefits to other people for their services to you.
– Be a great leader. To be one:
• Never ridicule a learner.
• Only reprimand in private and when absolutely necessary.
• Always praise good work publicly.
• Be personable and care about other people.
• Always involve people in your long term vision.
• Remunerate well and reward good work financially.
• Motivate, inspire and lead by example.
• Be consistent.
• Be clear of the outcome before you start [write it down].
• Set realistic goals: set others up for success not failure.
• Earn respect and keep respect [which may involve distance and professionalism].
Learn to master the art of leverage and you will be wealthy beyond your widest expectations, plans and goals.
Law 7: Money attracts Money: Investing and reinvesting will bring you wealth.
Like attracts like, that’s why you use bait to trap fish. Money is not an exception. Money invested brings in more money. The more money you invest, the greater the returns you will get. This is the Law of compounding. So do invest and reinvest what can be invested.
Law 8: Think Long term sustainability: That’s how you become and stay wealthy.
Anytime you have to make a career, business or investment decision, ask yourself: will this contribute to my long term wealth? Is it sustainable? Will it create a good return on investment (ROI)? Think long term and be forever wealthy for generations to come.
Law 9: Know how to be good at saying no!: If it is for the best.
You can’t hurt people’s feelings, so you are afraid to say no? If yes, know that sometimes the best thing to say is No: politely and firmly. And once you make that decision, stand your ground and don’t be bullied. Jimmy Cliff sang: “Let your Yes be Yes and your No mean No”.
Law 10: Modelling: Studying the successful methods of the rich and replicating them.
Many wealthy and successful people became rich through learned systems, strategies, mindsets and behaviours which constitute tracks that you can find, study and replicate. Learn from their mistakes and the successes to save you years of time, energy, trial and error.
Law 11: Price vs. Value: What you pay and what you get.
Price is what you pay and value is what you get. Nobody buys anything that they do not think is good value and many will be willing to pay premium prices for apparent value, sometimes regardless of cost. So always offer value and the money will pour in.
Law 12: Risk: Speculation, investment and gambling: Invest but don’t gamble.
Your attitude to risk will determine the amount of money you make. Although you must speculate, you must take only ‘calculated risk’. And like everything else, risk is relative and you must determine your own perception of risk and update it regularly.
On the other hand, any action (such as throwing your life savings into a procedure to resuscitate dinosaurs) which does not fit into an educated, well researched and carefully timed investment is a gamble. Your road to wealth begins with speculation and not gambling.
Law 13: Deal making, and negotiation: Think cooperation, partnership and long term.
Three skills necessary for attaining long term wealth and success are the Arts of sales, of deal making and of negotiation.
As they have the potential to return a life time of passive income, deals [such as negotiating a great property deal with discount and a high yield] can make you wealthy.
However to strike great deals you must understand negotiation. Don’t ever go into it to:
1. Get a cheap price by skinning people.
2. Obtain what you want by bullying people.
3. Make people sign to things they did not agree to or understand by conning, tricking or cheating them.
True negotiators avoid ego, barriers to entry or selfishness; they do not also seek to cut people too much on price because they know nothing is so guaranteed to make them pull out of a deal, change their minds sooner than later, resent you or portray you as a git!
People serious about making great wealth know that the true Art of negotiation consists in 1) highlighting perceived benefits to the other party, 2) helping them to the maximum and making the transaction as easy as possible, and 3) giving them the last word for them to get the feeling that they got the upper hand in the negotiation.
So, to build lasting relationships (not just in your job, business, wealth and success but also with your kids, family, friends and loved ones), think cooperation (not competition), partnership and long term benefits in any negotiation you enter into with people.
In any negotiation determine the maximum you are prepared to pay and stick to it. Say ‘thank you’ if the price is not your ideal and don’t be afraid to back out. That will not be the only deal in your life; and even in 30% of cases you might be contacted again.
In going into a deal, be cool and patient. Keep in mind that 60% of communication is non-verbal. So use the posture and the body language of those you are talking to as well as what their eyes are conveying to you to read into what they are not saying.
Get to know the emotions negotiations bring out in people: don’t make people crazy or take the ‘Michael’. Be diligent and educated about the deal. Be flexible and offer other benefits. Don’t give anything away but offer exchange. Let your vis-à-vis feel good about the negotiation; you aren’t giving up your only remaining kidney.
When you master the Art of negotiation you will have mastered half the art of being a great dealmaker.
That, however, requires:
Being a good negotiator: that is, knowing what value and price to put on a deal and shopping around and understanding relative value: a deal on its own might look good but compared to the market it might turn out to be anything but desirable.
Know your goal, what you want out of a deal and what the others are also seeking. Don’t make the biggest mistake most deal makers make by always stating from the outset that they want cheap or discount. The seller, of course, is not thinking of giving his product or service away for less than he sees it is worth.
Be opportunistic. As you have things, products, services and knowledge that other people need, offer them in return. Get to know other people that can help. Be flexible, professional and personable.
Law 14: The Art of borrowing money [and the rules!]: Borrow only if you must or is fruitful.
A very careful consideration of your strategy should guide you in borrowing money. You can easily adopt the following Laws-that wealthy and very rich people follow when thinking about borrowing-into your strategy:
1. If possible don’t borrow from friends or family.
Should you borrow from close ones, you will have a hard time trying to avoid them and they will try very hard to catch up with you when things go wrong. Don’t strain or lose your close relationships.
2. Only break Law 1 above if you absolutely must.
If borrowing from friends or family is your last resort for cash flow and investment into your business, then go ahead and do it.
3. Borrow only to invest in income producing assets.
When you have to acquire something that could potentially generate a lifetime of income far beyond the repayments, then there could be great leverage in borrowing money to do so.
However be warned that borrowing money can bring heartaches: people have lost everything, including their lives, in this regard; interest on loans can be crippling and emotional debt to someone even more so.
Your debts and loans are what you must pay off first. Just as the Law of compounding [Law 34] can work to make you rich, it can also destroy your finances in matters of compounded loan interests.
Law 15: Property and shares: Chosen carefully, they will return you long term wealth.
Property and shares will generate long term sustainable wealth for you and for many years if you choose them carefully. They make you passive income (money while you sleep) through the art of Leverage and the Law of compounding.
Although they made and still make people lots of money, but like any investment, shares and property are not risk-free. They appreciate and depreciate, and can do in the twinkle of an eye. Remember the crash in the 80’s and the dot com crash on the NASDAQ?
Law 16: Multiple avenues of income: is the way you significantly increase your wealth.
To significantly increase wealth you need to create multiple streams of income around your skill and expertise. Open an e-store. Create a website. Open more shops. Franchise your business model. Sell a part of your business. Sell education based around your skills. Reach more people. Utilise the media. Create multiple avenues of income through your investments.
The more avenues you earn from and compound, the wealthier you will become. So master the Art of earning while you sleep and be well on your journey of great wealth.
Law 17: Only buy quality: it saves you money in the long run and makes you feel good.
Craving cheap items (whether a business one such as stock or a personal possession) will very often end up costing you more money in the long run unless it was very well calculated.
Buying only quality also concerns ‘utility’ and ‘feel good factors’. Where is the utility if you bought a Ferrari and kept it in the garage all year? But a M3 or an Audi R8, at one-fifth the cost, which you drive every day, will give you almost as good a feel good factor and are infinitely more value.
Law 18: Work on your wealth not just in your job: Pause in your routine and plan to grow.
To succeed in your small business and move forward in your career you need to understand what ‘working on’ and working in’ mean.
Working in a career or job is what most of us do every day. We accomplish our day to day duties at the job, we live month to mouth and get our pay cheque and maybe year to year for the end of year bonus.
Worker or self-employed however, you must work on your wealth as well as your job, career or business. This is what will push us forward. To accomplish it, “we must step outside ourselves and look for means to grow, improve, increase turnover, increase profit and margin, reduce costs and overheads and learn more that will give us the skills we need to succeed.” Thanks, Johnnie.
We can call this the ‘strategy’ part of your business or career. It consists in asking questions as: how can I work to get that promotion and higher salary? How can I grow my business or set up systems so that it is not entirely dependent on me?
Now, how can you work on your wealth?
That’s what you are doing right now by reading this material to get the right mind-set and psychology, the right strategies and systems, and taking action on the 48 Laws of wealth.
The most successful and wealthy people devote a great deal of time on growth, strategy and the future of their businesses. You must also find a specific and set time and use it to build your wealth. Do it at your most productive hour where there are no distractions. One hour every morning in a quiet corner of your house will do.
You also need monthly and yearly review of your finances.
Find out each month if you have worked within your wealth strategy and how much as a percentage you have spent/invested compared to what you budgeted.
Then every year do a thorough check up to review your net worth as compared to the previous year’s. Edit your spread sheets as you change your figures and increase the amount of money going in, debtors and creditors, expenses, investments, loans and interest, direct debits and standing orders, credit card balances and so on.