I love to teach people to leverage their powerful cash flow(s) to achieve financial freedom. In my role as wealth strategist and advisor, I have been amazed by how often I encounter successful people making 6 or even 7 figure incomes, who are not reaching financial freedom, or even on a fast track toward it. Here’s what I am talking about...research shows that in the US alone:
- There are approximately 3.5 million High Income Producing households, that bring in above $500,000 per year in earnings Read more
- There are just under 8 million Multi-millionaires that have a net worth of $3,000,000 or more in assets Read more
- Many people joined the second group while earning less than $500,000 per year! Read more
And, while both groups sound extremely successful, only a small percent of either have achieved the financial freedom to fund their current lifestyle and passions without working for earned income!
Rethinking Wealth Indicators
What happens when we hit our income goals, but then realize that more is needed to build financial wealth, have more freedom, with a fulfilling life of purpose?
- High Income Producers often learn that net worth can take much more than income
- High Income Producers can feel like slaves to their wages
- Multi-millionaires can become disenchanted having to continue to take so much time away from family, selfcare, and the pursuit of meaning, impact, and philanthropy
- Multi-millionaires can feel like slaves to their assets
And both can feel like they woke up after years of thinking they were on the right path, only to find that they needed to have had more information, sooner, to actually attain what they were seeking. Their “indicators” of progress toward wealth did not tell the whole story.
Guiding the Mind in the Right Direction
The big question is, how does someone gain real Financial Independence?
What I teach as the ultimate goal of Wealth Building is financial freedom. And, it’s possible to advance that today by learning which financial indicators to monitor, and which actions will influence these indicators:
What metrics, that rarely hit the financial pages, could lead directly to answering this question? What would the value be of tracking “reinvestment percent of personal income” and “passive income as a percent of total family income?”
- While working to learn your career or industry better than anyone around, are you working to learn how to best make those earnings create the financial freedom of time?
While working to change the revenue of your company or your income, is this work fueling your passion, skills, and assets to leave a mark that you will value far beyond the money you earn?
Acquiring a "Passive Income" Mindset—Today’s Gift to You
I’d like to offer you this “challenge,” whether you are a High Income Producer, a Multi-Millionaire, or someone anywhere on the path to financial freedom, to commit to the following Wealth Builder daily practice for a month:
1. Review last year’s income. How much of it was spent on lifestyle? Think of one expense that could be reduced or left out and put this saved money toward your “passive” cash flowing investments. (eg. “Today I flew coach instead of 1st class and put another few thousand dollars toward my next capital contribution to equity in a business”)
2. Read biographies and autobiographies of billionaires who are making a difference, and look for examples of daily habits mentioned that the author credits with leading to “passive” cash flowing investments or any other replication of cash flows (eg. Paul McCartney earns about $15 million per year in song royalties from music recorded over the last half century. That’s a lot of money earned from work that was done in the past and keeps on paying to support his life and mission).
3. Get a small notebook to carry, or use your smartphone to create your “Passive Income Lists.”
- List all of your current passive incomes in one section,
- List your ideas for possible new passive incomes, in another section, and
- Divide your passive income received by your monthly household income. Use this to compare “passive percent of total income.”
- Now calculate your “reinvestment percent of personal income” by dividing the money you contributed this month to increase your passive cash flowing investments by this month’s total household income.
Look at your Passive Income Lists and metrics at least once per day. Notice what repeatedly looking at these two measures each and every day for a month does to your focus.
4. Next create a plan for how you would like to see your work do even more good in the world!
- List your most important passions, skills, and assets.
- List what impact or legacy would feel most rewarding for you to create or leave as your mark.
- Brainstorm for ideas on how to use your passions, skills, and assets, to create the impact or legacy you want to leave, and see if that becomes an inspiration for something new!
Finally, to complete the challenge, implement these habits, asking yourself each day, what lesson you could gain from that day’s practice. You might decide it is worth adopting some new habits permanently!
THE FOUR CUPS
Live Exceptionally. Be the Difference.