 |
Millions of copies have been sold But while...
Posted on 2010-Mar-2 at 12:32
Millions of copies have been sold But while millions of people freely repeat that powerful statement, few follow the adviceAs I said, financial literacy allows one to read numbers, and numbers tell the story By looking at a person's income statement and balance sheet, I can readily see if people who spout the words "pay yourself first" actually practice what they preach
A picture is worth a thousand words So let's again compare the financial statements of people who pay themselves first against someone who doesn't
People who pay themselves first
------------------------
Job--------------->|Income |----
^ |------------------------- |
| | Expense | |
\ ------------------------ |
\ --------------------------------------<
----\-----|------------------------
| Assets | Liabilities |
| chanel ceramic watches | |
|_________|____________|
Someone who pays everyone else first- Often there is nothing left
------------------------
Job--------------->|Income |
|-------------------------
| Expense | ----> Nothing left!
------------------------
-----------------------------------
| Assets | Liabilities |
| | |
|_________|____________|
Study the diagrams and notice if you can pick up some distinctions Again, it has to do with understanding cash flow, which tells the storyMost people look at the numbers and miss the storyIf you can truly begin to understand the power of cash flow, you will soon realize what is wrong with the picture on the next page, or why 90 percent of most people work hard all their lives and need government support like Social pink louis vuitton bag Security when they are no longer able to work
Do you see it? The diagram above reflects the actions of an individual who chooses to pay himself firstEach month, they allocate money to their asset column before they pay their monthly expensesAlthough millions of people have read Classen's book and understand the words "pay yourself first," in reality they pay themselves last
Now I can hear the howls from those of you who sincerely believe in paying your bills firstAnd I can hear all the "responsible" people who pay their bills on timeI am not saying be irresponsible and not pay your billsAll I am saying is do what the book says, which is "pay yourself first And the diagram above is the correct accounting picture of that actionNot the one that follows
My wife and I have had many bookkeepers and accountants and bankers who have had a major problem with this way of looking at "pay yourself first The reason cheap replica rolex and cartier watches is that these financial professionals actually do what the masses do, which is pay themselves lastThey pay everyone else first
There have been months in my life, when for whatever reason, cash flow was far less than my billsI still paid myself firstMy accountant and bookkeeper screamed in panic "They're going to come after youThe IRS is going to put you in jail "You're going to ruin your credit rating "They'll cut off the electricity I still paid myself firstBecause that's what the story The Richest Man In Babylon was all aboutThe power of self-discipline and the power of internal fortitude "Guts," in less elegant termsAs my rich dad taught me the first month I worked for him, most people allow the world to push them aroundA bill collector calls and you "pay or else So you pay and not pay yourselfA sales clerk says, "Oh, just put it on your charge card Your real estate agent tells you to "go dior saddle handbag ahead-the government allows you a tax deduction on your home That is what the book is really aboutHaving the guts to go against the tide and get richYou may not be weak, but when it comes to money, many people get wimpy
I am not saying be irresponsibleThe reason I don't have high credit card debt, and doodad debt, is because I want to pay myself firstThe reason I minimize my income is because I don't want to pay it to the governmentThat is why, for those of you who have watched the video The Secrets of the Rich, my income comes from my asset column, through a Nevada corporationIf I work for money, the government takes it
Although I pay my bills last, I am financially astute enough to not get into a tough financial situationI don't like consumer debtI actually have liabilities that are higher than 99 percent of the population, but I don't pay for them; other people pay for my liabilitiesThey're called buy fake rolex watches tenant
« Last Page :: Next Page »
|
|