The Entrepreneur's Blog - Talk About Gold

New E-Biz Idea

2006-04-23T18:38:00.000-07:00

I decided to do away with the article directory. Although it was making me a decent stream of passive income, I just came up with an e-biz that will give me something bigger, faster and better. It's actually all on paper now, but I have yet to launch it. Will post updates soon.

Article Directory Up and Running

2006-04-03T19:12:00.000-07:00

Thanks to my steady stream of passive income, I am now able to finance my own article directory and .COM. For webmasters looking for/wanting to promote your website content, you can visit EzineGator.COM by clicking here. The directory covers a wide range of topics listed by category to choose from.

E-Hub Launching.

2006-03-21T19:45:00.000-08:00

Hi folks!

I have officially launched by on-line community for Entrepreneurs. While it is relatively new, let us make it a haven for healthy business discussion and information resource. You can visit the site by clicking the link on the right side of this blog or you can bookmark the forum by clicking here.

The 45 Year Plan

2006-03-21T17:37:00.000-08:00

The statistics that come from the Social Security Administration are quite surprising.

Taking a look at the graph, only 1% are wealthy. Meaning, these people no longer have to work, with an income of $350,000 or more. 4% are well to do. The 95% aren't doing so well. Out of the 95%, 5% are still working by the age of 65. The conitnued drop in the dollar, globalization and downturn in the stock market has eroded the average joe's retirement plans. Therefore forcing even more people to remain in America's workforce. 28% are dead. The remaining 62% are dead broke, living off Social Security and whatever pension they can hang onto earning less than %10,000 a year income. They drown further and further into debt. Isn't it sad that 95% of people still end up working, dead or dead broke and no one ever stops to ask "why?".

The answer is simple. 95% of people work 45 years of their lives making the 5% rich. These people are being "leveraged" on, making the 5% fulfill their plans, and not their own. In short, they are working for someone else's success, not their own.

Doing what you are doing right now, are you in the RIGHT vehicle? I am not talking about the car you drive, but more importantly I am talking about your FINANCIAL vehicle. A very successful coleague and mentor of mine once told me, "If you've always done what you've always done, you'll always be what you've always have." The 80% of the 1%, became wealthy by owning a BUSINESS.

To illustrate this simple wealth creation formula:

You(Driver) + What you are doing(Vehicle) = Goal

You have to ask yourself:
-By working hard for the next 10-20 years of my life am I in the right vehicle to get me to my goals?

This makes SENSE doesn't it? Being hard working isn't enough. Most people have already worked so hard their entire lives and have nothing to show for it in the end. Only by being in the RIGHT VEHICLE, then and ONLY THEN, will hard work mean something!

Why business is the way to go, and why employment is a "slow and painful death"

2006-03-21T17:03:00.000-08:00

Before I begin a discussion on the subject of financial freedom, I believe that I ought to explain what it is. Take the following, for example (all figures are in US dollars - adjust as appropriate for your local currency).

If you were to increase your income next month by 1 dollar, without doing any more work, most likely you would not notice the difference. Nowadays, it's not even enough to buy a drink at your local watering hole.

Imagine then that the increase were not 1 dollar, but 20 dollars still without going out of your way to "make" it. Again, the increase is very unlikely to be enough for you to notice it, though it is enough to take yourself out once - maybe to see that film you couldn't afford to before.

The next step is more interesting, but still not anything fascinating: an extra 1000 dollars per month coming in whether you like it or not - simply appearing in you bank account on the first (or whatever other) day of each and every month.

Doubtlessly, this would make a difference to your lifestyle. It would pay off those bills that always seem to be left over at the end of the month - if, and this is a very big if for most people, you can budget your money effectively. Maybe it would allow you to move to a larger home - an extra 1000 dollars per month in mortgage repayments substantially increases the size of place you can get - or just pay off the one you are already living in. Who knows, but there are not too many people for whom it would not make at least a small difference.

Guess what, we now move to 2000 dollars month. No, it's not a huge amount of income, but for the majority of the population, it isn't too far off what they get paid anyway. This sort of automatic residual income is more than just money: it is one of two other things, depending on what you choose to do: either it is security, a cushion that will protect your lifestyle should you become unable to perform the tasks that produce your primary income; or it is time. If your job does not pay this much, and yet you have this sort of money coming in on the side, there comes a point where it is somewhat un-economical to continue with the job.

Take a moment to think about it (and if you need to up it by a factor of 2 or 3, who's counting?) How would it change your life if you had a second income, equal to your primary income, that you did not have to perform for: an income that would find its way into your bank account if you made it out of bed or not? Would you continue working as you do, but live elsewhere, driving a nicer car (not that the car you presently drive isn't nice...), or take holidays in less crowded, sunnier places with finer sand? Would you tell your boss that you were only prepared to do (short) shift work, so you could get up when you felt like it, and head home on your own command? Or perhaps you would pick up the phone one morning and call in well ("Well, I ain't coming in no more.")

I do not know what you would do, but your mind has probably already found a way to spend that extra 2000 every month. In deed, it is certainly not difficult to spend that sort of money.

So we move on: 10000 each and every month!!

This is easily enough to make most people decide to give up work (except the ones who have accumulated debt / overdraft / mortgage / etc in amounts that would make most "normal" people sick. True, there are some people who earn in excess of this amount, but how many of them have any time? How many of them have spent a whole day (with the possible exception of a Sunday) with their family in the last month? How many people earning six figure annual incomes can afford to take a week or two off - on a whim?

Far be it from me to suggest that there are not people who have this level of freedom: indeed, they are the ones to look to for guidance in attaining financial freedom, but more of that later.

Time now to get "silly." Actually, it is not that I consider the next step silly, it is purely an increment of a factor of ten, like all the others, but for some reason many people fail to be able to imagine it. Whatever the case, it is the most fun one mentioned so far: 100000 per month - in excess of 1 million a year.

Too much money for one person? That is a question for someone else who is discussing ethics and beliefs, but if it is earned, there is no reason to say it is too much for a single person. And let's be really honest here, if that were your income, how much would you give away? (And anyone answering all - or almost all - of it is either angelic, foolish, or unaware of just how much 1.1 million is: you might give it away for the first few months, but not for all that long.)

So, what would you do with this sort of residual income. Where would you live? You would not have to wait more than a few short months to buy at least a starting house in your location of choice. What car would you drive? Half a year would (almost) buy you a McLaren F1, the most expensive (as far as I know) car commonly available - yes, there are antiques and other non-production cars that cost more, but they are a totally different category. Where would you take your holidays? And how often?

What would you do with all that time?

Who would you help?

Let's face it, would you bother about your gas and electricity bills? (or would you just pay off the next ten years in advance to save yourself a bit of hassle?)

When shopping for clothes, would you finally look at what you are buying, or would you keep looking at the price tag to decide whether or not you like something? In restaurants, would you look down the right hand column first (as you do now), or would you decide what you want to eat, and not worry about the size of the bill?

If you have ever thought that rich people were materialistic, find one and ask him/her. If they have worked for their money (lottery winners are not rich - or won't be for more than a few short years - and certainly didn't work for it), most of them are not. They enjoy toys: everybody likes toys, it's just that they can afford the ones everyone else just drools over.

As an example, if two people - one a multi-millionaire and the other your average Joe - both crashed their cars, who would be more upset? The millionaire, who wrote off a 100000 pound Ferrari, or Joe, who's beat up old banger was worth twice as much when he filled it up with petrol? (It is those who don't have much who value the little the can get so highly: it is they who are really materialistic).

So, back to the idea of financial freedom. Just what is it? To put it simply, it is having enough money coming in, that you no longer need to work for, that you can buy back your time, and you can create true security.

Of course, a definition of security would be helpful here. Security is being in a position whereby whatever happens to you, you have previously established a solid financial net for yourself and your family. How many jobs are secure? If a pilot's eye-sight shows even the slightest signs of deteriorating, he is out in the cold before he knows it. If a doctor looses the use of a hand and can no longer perform operations, his enviable salary goes flying out the window. Anyone else who becomes incapacitated in any way will find that, according to their boss, they "are no longer capable of performing their job to a satisfactory degree that they are worth employing."

Security is being in a situation whereby whatever the external events, it makes no difference to your lifestyle.

(Some people think that pension plans and insurance policies are the answer to their security worries, and I would not wish to say anything that would denigrate the very useful service these people provide: I simply must ask at this point, how secure are these plans. Are you, as an investor, the one controlling what happens to your money, or could the company involved belly up and die?)

Financial freedom is a degree of personal freedom that most people never experience; not because there is anything stopping them, but because they do not understand the difference between price and cost. Price is a one- off amount. Cost is a long-term pricing system, based on usage, or overall expense.

What I mean by this is that the average person will work for about 45 years, at (for simplicities sake) 50 weeks a year, putting in 40+ hours each and every week. This is only 8 hours a day, but it adds up. It totals 90000 hours, with nothing to show for it at the end. The "price" is low - just another eight hours - but the cost is life (the statistics on people's abilities to support themselves once they reach retirement age make for shocking reading).

The alternative is to go out and do something different from the masses (more on that later). It is usually assumed that the entrepreneur will work anything from 12-18 hours per day, 6 or seven days a week (let's take 100 hours a week as an average), for all 52 weeks in the year (but for simplicity of calculations, let's say 50 again).

That means that one year for the entrepreneur is 5000 hours. If it takes him a whole eighteen years to build up a business that is self-sufficient and no longer requires him to put in any of his time (and most achieve at least semi-profitable stability after 5-10), then time-wize he will be equal with someone who had a job, except that he finished 27 years ahead!! - and is most likely making far more.

In other words, though the day by day price of living a normal life, with a job, is perhaps lower, the cost far exceeds that of seeking financial independence. Which would you rather: to put in twice the effort now so you can play for the rest of your life, or spend every week looking forward to Saturday until finally you retire with not only not enough money (or the health) to enjoy it, but not enough money to keep you in the lifestyle you were previously accustomed to.

Thus the great question that is bound to be asked: "So, what do I do to become financially independent?"

There are probably as many answers as there are people who will ask that question, and I have no intention of listing any of them. All I will suggest, (having heard it time and again from people who have achieved financial independence on a massive scale) is that you read positive books, listen to inspirational tapes, and attend self-development and other motivational functions. Also, if there is someone who is already successful in the area you finally choose for yourself, go to them as a student, learn from them, learn from their mistakes, model yourself after them.

Do what the average person in the streets is not prepared to do. Get out of your rut (a rut is nothing but a grave without ends). Be like the 5% who can afford to enjoy their lives when they reach retirement age.

Now, I am in no position to give a list of good generic tapes (the ones I listen to are specific to what I am doing in my pursuit of financial independence), but I can recommend some books (in no particular order - asterisk (*) indicates must-reads for everyone even vaguely interested in some level of higher success, but then, they're all good).

The Magic of Thinking Big*, David J Schwartz
How to Win Friends and Influence People*, Dale Carnegie How to be Rich, John Paul Getty
Millionaire Mentality, Dexter Yager
Awaken the Giant Within, Anthony Robbins
Do It!, John-Roger and Peter McWilliams
Unlimited Wealth, Paul Zane Pilzer
Over the Top, Zig Ziglar
The Popcorn Report, Faith Popcorn
Any (auto)biographies of highly successful people. Anything recommended to you by someone who has what it is you truly desire.

That's all from me on the subject of financial freedom, at least for tonight. All that remains for me to say is this: I'll see you at the top, on the beautiful beaches of the world, whichever route you choose to take.

Plan A. Work hard at school, secure good job, set your sights on promotion, climb the corporate ladder, live happily ever after.

Reality check for Plan A. Work longer and longer hours just to make ends meet, condemned to a life of wage slavery, drowning in sea of debt, poverty of mind and spirit, existing to work.

Plan B. A simple yet revolutionary idea. Get out while you can.

Comments and suggestions are welcome.

For On-line Entrepreneurs

2006-03-20T21:14:00.000-08:00

Dear Fellow Internet Entrepreneur

I'm sure all of you have heard of "e-businesses" or more popularly known as "internet marketing". Having an e-biz is a good way of generating passive/residual income. There are plenty of neat ways of making money from online businesses.

Here are a few examples:
1. E-zines
2. Affiliate programs(You get paid for advertising other people's goods)
3. Your own on-line store(e.g., Amazon.Com, E-Bay, etc)
4. Pay-per-click programs(I recommend Google Adsense)

At the end of the day though, there is only one measuring stick that will determine your e-biz's success and that is: TRAFFIC!!!!

-----

Internet marketing is not a mystery, there are no "secret" formulas, and you do NOT need a guru. Success on the Internet comes down to one simple thing .... TRAFFIC!

No matter what you sell, or which sites you promote, more traffic will help you sell more in less time! More traffic = more potential customers!

More traffic will help YOU if you....

Create and sell products online and want to sell more.
Are an affiliate for any website and want bigger affiliate checks.
Have joined any Network Marketing program and want to build a massive downline fast.
Publish an ezine (newsletter) and want more signups.
Or do anything else on the Internet that involves a web site.

It's simple ... more targeted traffic helps YOU succeed faster!

When you have enough targeted traffic (targeted traffic simply means people who visit your website and are interested in what you offer) you make more sales, earn more affiliate commissions, grow a powerful mailing list faster ... in short, you achieve your online goals in record time!

Without enough traffic ...

Even the best sales letter is wasted.
The best product in the world goes unnoticed.
The greatest compensation plan invented is meaningless.
No matrix in the world can succeed.
Powerline systems remain empty and unproductive.

Traffic is the key to success on the Internet.

To increase your site's traffic, go to:


http://www.trafficswarm.com/go.cgi?480417

How to Earn More and Work Less

2005-10-24T20:39:00.000-07:00

by Scott Allen

Do you want to continue working 50, 70, 100 hours a week the rest of your life?

Good! Neither do I.

Do you want to be able to take time off whenever you want to, without worrying about what's going to happen to your business?

So do I!

There's a saying in the corporate world: "Don't make yourself irreplaceable. If you can't be replaced, you can't be promoted." As an entrepreneur, this is still true in its own way. Let's think of "being promoted" as earning more and working less. You can raise your prices, but until you can remove yourself from being directly involved in doing the work that generates the income, there's always going to be a limit to how much you can earn, and it can only increase very slowly.

Passive income, on the other hand, is income that does not require your direct involvement. Some kinds of passive income you may be familiar with include owning rental property, royalties on an invention or creative work, and network marketing. If you want to earn more, work less, and have a decent retirement, you're going to have to start creating income streams that do not require your direct involvement. Whether you're just starting your business, or you've been running it a while, the sooner you start thinking about how you are going to shift your business model to create more passive income, the sooner you can achieve personal and financial freedom.

Let's look at two basic types of passive income, and a third type of income that, while technically not passive, is a key strategy for earning more and working less.

Residual Income

Residual income is revenue that occurs over time from work done one time. Some examples include:

An insurance agent who gets commission every year when a customer renews his policy
A network marketing or direct sales rep's income from her direct customers when they reorder product every month
An aerobics instructor who produces a video and sells it at the gyms where she teaches
A marketing consultant who creates a workbook and sells it in e-book format on the Internet
A photographer who makes his photos available through a stock photography clearinghouse and gets paid a royalty whenever someone buys one of his images
A restaurant or retail owner who has grown to the point of hiring a trustworthy manager

As you can see, there are many different ways to generate residual income across a wide variety of businesses. It may be recurring income from the same customers, or the sales of a product to new customers. It may require no personal involvement whatsoever, such as an e-book sold on a web site, or it may require some personal interaction, such as the insurance agent calling the customer to remind them about their renewal and ask them if they want to change any of their coverage. Often, it's something that you can delegate to an assistant.

Note that this is different from merely recurring income. Recurring income may still require your involvement to earn the income, e.g., a coach or consultant on a monthly retainer, or a caterer who delivers lunch every Monday to the local school board. While this "active recurring income" offers welcome stability, it also tends to tie you down, and you still have limits on your earning capacity based on your own personal production capacity.

Leveraged Income

Leveraged income leverages the work of other people to create income for you. Some examples of leveraged income include:

An e-book author selling her e-book through affiliates who promote the product
A network marketer who builds a downline and receives commissions on the sales made by people in his downline
A general contractor who makes a profit margin on the work done by sub-contractors
Franchising your business model to other entrepreneurs (the ultimate leveraged income)

Again, there are many different models in many different businesses. The key is that you are making money off of other people's labor, rather than primarily your own. Note that leveraged income may or may not also be residual income. When you combine them, that's even better.

Active Leveraged Income

This is a term I use to describe income that requires your direct participation, but that you can make more money by having more people involved. This generally involves a one-time event, such as:

A seminar or class
A conference or convention
Concerts and dance recitals
Raves and other parties

Although these require your direct participation, your earning potential is much higher than if someone were just paying you a direct hourly rate. Fill a room with 1,000 people paying $50 each and you can cover your facility cost, promotional cost, and staffing fees and still have a nice chunk of change left over.

Applying It

Now is the time to think about how to apply this in your business. Can you create a product that people will buy over and over again? Can you engage others to sell your product? How could you make money off the work of others?

The sooner you answer these questions, the sooner you'll have financial and personal freedom.

The Concept of Passive Income

2005-10-24T20:33:00.000-07:00

How Hillary Adams taught her 12-year-old

by Ina Bliss

Money, income, bills, investments, does the sheer thought of them make you want to shriek in disgust, curl up into a prickly ball?

What an advantage to those with reliance on advisors of financial savvy! Early on in their lives, while the rest of us still trying to make some sense of the financial world! How many times did the thought strike you "I could be rich now, if only all these facts had come to me as a kid, or at least much earlier." Why then would you let your child experience the same lack of practical financial strategy?

Hillary Adams, a former white collar worker, felt the same, every time her son asked her for an advance. All her talking about not having enough money and his having to be more careful with his spending did not seem to be understood by him.

She needed facts, a way of demonstrating, and soon. About the same time she quit her job and went into business for herself, she began digging for a sensible solution.

First, many nights were spent in books. She discovered the term passive income and a fascination with its concept.

Passive Income

Does it mean it just sits there, regardless of what one does, it's inactive? Not exactly. Passive income is cash-flow obtained without linear time involvement. In other words, while you sit on the porch knitting, your passive income is generated, non-stop. You only had to do the work once.

Secondly, after Hillary discovered this concept, thought of all the benefits of doing business this way. She began to motivate herself for several days into finding a way to make a small investment, on behalf of her son, with a very important switch in mind.

Here is What Hillary Adams did:

She bought a small table-top game machine. As the contraption was delivered, and she and her son Aaron unwrapped it, she let him try it out, play with it, answered his questions, and finally told him: "Aaron, this machine is yours. And even better, all the money it's going to make is yours. However, I am only able to lend you the $227 it took to purchase the machine for a little while. You must pay it back. I'll help you set up the machine the rest is your business. Now, honey, tell me, can you do it?"

Aaron thought for a minute. His answer surprised Hillary: "Mom, I don't know if I could do it by myself. But with you there, I guess so. And after that "Yes, mom, I guess I can do it."

Thirdly, as they set up the machine in a few days, and impatiently waited for their first cash pick-up day to arrive, Hillary noticed the benefits of her actions had already begun to materialize and she was quite pleased.

The exciting switch she had intended had taken place, from her son's waiting to be given money to his own plan of action, from give me to I can do it MYSELF. His attitude, after re-paying her the amount for the table-top game machine would now be the one of a responsible business person. Now that he had done it once, he would always be able to do it. He would not remain in the "poor" thinking mode.

He would eliminate the feeling of lack of money from his life, while he now had the self-esteem and confidence to invest the surplus of his machines, after purchasing a few more, in his very own college fund.

The Moral

Without looking, you don't find. Such a small change is bound to turn Aaron's life around, for he is already on the way to becoming an accomplished business owner. "How old is he?" you ask. He's only 12 years old.

Business vs. Self Employment

2005-10-24T17:59:00.000-07:00

The two are synonymous for some people, but in actual practice they are worlds apart. People nowadays who don't want to end up as employees would rather say "I won't be an employee! I'll be self-employed and make lots of profit on my own!" First of all, being self-employed is no different from being an employee. When you are SE, you are simply "hiring yourself" to do all the dirty work. The only reason why a typical employee earns less than someone who is self-employed is that a SE individual owns his own firm or company, and has little to pay on wages because he is his own employer thus resulting in a larger profit.

For example:

Mr. A owns a retailing store and runs it on his own. Mr. B is a manager of a supermarket Mr. A is responsible for monitoring his sales, conducting the purchases, looking for potential customers and attending to his store. Aside from the profit he makes from sales, he has no employees to pay because he is SE. Mr. B would earn less, since he does not get any profit from the sales of the supermarket, but is only compensated for his managerial services on the supermarket owner's expense.

A business is an entity that knows how to use leverage as compared to SE. Leverage refers to making more and more while doing less and less. This includes turning your stores into assets wherein they would generate a constant stream of cash inflow with little to no work at all since you will be using OPM and OPT(other people's money and other people's time). Some examples include: Franchises, real estate renting, internet services providers, telecommunication services, vending machines and car rentals and the like. There are more than several ways to create a business. All it takes is an entrepreneureal mind. So, would you rather start a business or hire yourself?

Protect Your Money from Inflation by Using I-Bonds.

2005-10-24T03:10:00.000-07:00

By: Michael Press

Inflation is bad when it comes to money. The cost of goods and services rise every year due to inflation, yet the value of a dollar remains the same. For example, $100.00 in the year 1945, is equal to $1022.20 in the year 2004. A nice little inflation calculator tool can be found here: CPI Inflation Calculator. Inflation makes the value of a dollar bill worth less and less every year. According to BankRate.com, the current national average interest rate for a one year CD is about 2.5%, which is less than the average inflation rate of 3-4%. So in reality you are actually losing money with your CD, because of inflation.

To help protect your money from inflation, you can invest in I-bonds. I-bonds are Secruities offered by the U.S. Treasury, and are backed by the U.S. Government. They are exempt from state and local income taxes, and you can defer the federal taxes on your earnings for up to 30 years. Plus, they can be converted to cash anytime after 6 months.

The interest rate (sometimes called Earnings Rate) of an I-bond is determined by combining a fixed rate of return, with a semi-annual inflation rate. The U.S. Treasury determines these rates on May 1st and Novemeber 1st of every year, and then combines them to make the earnings rate for an I-bond. Until April of 2005, the current earnings rate on I-bonds is 3.67%

I-bonds can be bought through your local bank, or online at http://www.savingsbonds.gov. They can be purchased at face values of $50.00 all the way up to $10,000.00. To cash an I-bond, simply go to any bank that will cash a bond, and you'll get your money. The maximum amount of money that you can invest in I-bonds per year is $30,000.00.

Let's Talk About Gold

2005-10-22T06:27:00.000-07:00

I would just like to welcome everyone to the opening of my blog. This website is dedicated to discuss my views and opinions regarding the very delicate subject of handling what the world knows as MONEY from the point of view of an objective entrepreneur faced with the realities of starting and maintaining a business. I hope that I will receive feedback, and my posts would be a source of enlightenment and healthy discussion to my visitors.

Sincerely,

MrGold