We are creatures of habit. This can manifest in simple ways, as the type and number of restaurants we frequent or as complex as the companion we choose. We often make a decision to change our patterns, only to find ourselves sliding back into them shortly afterward. Real change requires strong and continued commitment.
There is an undisputed link between commitment and reward. Big goals demand big effort. If the effort is average then your reward will be, too. However, some find big goals intimidating for that very reason—they demand big effort.
As we discussed in the previous chapters, money is a commodity of exchange. It doesn’t change—it only makes you more of what you already are. It will make a good person a great person and a bad person a terrible person. If you consider yourself to be a good person, then becoming rich will not only help you, but it will also allow you to help others. In order to make life better for those around you, you must seek wealth for yourself. You cannot give what you do not have. Unfortunately so many people are caught in their ‘keep up with the Joneses” lifestyle that they sacrifice true wealth for what they can get right now.
It is natural for all of us to compare ourselves to those around us. Since most of us carry around an Attitude of Average, we view our lifestyle as being within a range of what’s comfortable and comparable to our friends, neighbors, parents and siblings. But what it really means is that we’re limiting ourselves through comparison to others.
We create within our own mind an idea of the “obtainable” rather than the “possible.” So when we set goals, we start out by deciding what is obtainable and then take steps to achieve that limited goal. A good example would be if you look at your bank account and income statements of what you earned last year. That represents what you know you can earn. Then, you might decide to stretch a little to what you think you can earn and set your goal there.
This goal may only be 5-10 % higher than last year. The problem isn’t that you can’t meet that goal—you can! And maybe that’s the problem—the goal is too limited to begin with. Instead of contemplating what you really want you force yourself into a series of very small steps to reach what you think you can achieve. Since these are small goals they require small effort and don’t really move you forward.
The comparison paradox arises frequently in the business arena as well. Each year, executives in almost every company I know will try to make projections for the next year’s sales. They’ll set a goal 5–10% above the current year. This is extremely low but they’re trying to set a goal that they know they can meet and with the least amount of effort. Often the board or company owners will ask for a much more aggressive goal of 30% or better and then ‘settle’ back to 20%. This becomes more a prognosis than a goal. Instead of striving to be number one in the market they only strive to improve upon last year’s performance. The 20% becomes their best case scenario. What if they aimed for the top—even if it meant doubling their sales? This projection of ‘achievable’ limits what is possible prior to even trying.
The problem with the comparison paradox is that it allows us to believe that we are setting goals and making progress—which is a good thing in most people’s minds. But in reality, it limits us to a predetermined outcome and cheats us of our true potential. It also sets up an endless pattern of settling. We achieve insignificant goals with little effort and when we achieve them, we set more insignificant goals as a follow-up. This is what makes us feel secure. But we end up stuck in this cyclical pattern, frustrated with our slow progress and at a loss as to how to fix the problem.
The irony of this situation is that, when challenged with a big goal, the response is one of disbelief. We’re already so busy, how can we possibly achieve a goal that is many times higher than what we’re already doing? People in these shoes need to prioritize and eliminate all the things in their lives that consume energy but produce next to nothing.
Any task that you have to accomplish will swell in perceived importance in relation to the time needed to accomplish it. This is known as Parkinson’s Law. How many times have you been given a ridiculously short deadline for a project but you were still able to complete it—and complete it well? Short deadlines force us to focus and produce, which we could do much more frequently if we chose to. This allows for compression of projects into less time. But it does take focus.
This is where making a daily list of tasks can be a huge help. By checking off tasks as you finish them, you keep from becoming distracted and losing focus. This ability to self-motivate and keep yourself from falling back into the habit of wasting time is a cornerstone of self employment and true wealth.
There have been times in your life when you decided to make a change. Maybe it was to quit smoking. Maybe it was to go back to school. You know it’s a change for the better, and you feel committed to it. Six weeks later, you realize that you have let the idea slip away and have fallen back into your old habits.
Because our paradigms and old beliefs are so ingrained, deciding we want to change often isn’t enough. Even committing isn’t enough. I ran across a study conducted by Brigham Young University in 1993. It compared the statements a person made about a particular change in their lives to the likelihood of them actually incorporating it. The results were as follows:
• Of those that made the statement “That’s a good idea.” They only had a 10% chance of making a change.
• Of those that committed and said, “I’ll do it.” They only had a 25% chance of making a change.
• Of those that said when they would do it, they had a 40% chance of making a change.
• Of those that set a specific plan of how to do it, they had a 50% chance of change.
• Of those that committed to someone else that they would do it, they had a 60% chance of change.
• Of those that set a specific time to share their progress with someone else, they had a 95% chance of change.
This illustrates how powerful it is to be accountable to someone. Accountability greatly increases your chances of doing what you say you are going to do. This is why it is so helpful to work with a coach or mentor. They’ll hold you to your word and ask hard questions if you aren’t measuring up to your own expectations.
We frequently let ourselves off the hook way too easily. We make excuses and create the logic that allows us to quit. While it may take some work to find a person that believes enough in your goals to hold you accountable, it’s worth the effort. I frequently encourage individuals to seek out the support of a Mastermind Group. This is a group of individuals who have similar goals and aspirations. If you have regular meetings to share your progress and get support, it makes you accountable. And this can mean the difference between you succeeding or having setback after setback.
For many people, the idea of joining a Mastermind Group is a real departure. But often a departure is necessary to really move you forward. If you could become a millionaire all on your own, you’d already be one. Getting help can be the best avenue to learn quickly and have resources to draw on if you come up against something unexpected.
Having a job is probably the most difficult paradigm of all for most people to overcome. It trips up more would-be millionaires than almost anything else. Even when they think they’ve changed and started a new business, they often find they have merely bought themselves a job. They still don’t really understand the basic principles of passive income. Getting a job and trading your time for money may seem like a good idea. In fact, the vast majority of people will tell you that it is. However, when you start with the idea that time is your only non-renewable resource, then it seems awfully counterproductive to trade your most valuable commodity for a set amount of money.
If you have a job, you only get paid while you’re working. That makes true wealth hard to generate. Passive revenue streams allow you to make money around the clock, leveraging your time to its fullest advantage. Just think how wonderful it would be to get paid while you were eating, sleeping or on vacation. If you plant a seed, doesn’t it grow even if you’re not there? Doesn’t the river flow when you aren’t looking? Money has the same ability.
This idea that we should work 40 hours per week is arbitrary. It’s just fabricated nonsense. Who cares how many hours you work each week? If it took me one year to write this book, would you think it worth twice as much as if it took me six months? Of course not. If you provide something of value to people, they won’t care how long you worked to produce it.
You’ll want to build sources of revenue that generate passive income on a continual basis. There are many ways to do this. They can include starting a business, building a web site, becoming an investor, generating royalty income from creative work, network marketing or affiliate programs. These deliver ongoing value to people and generate income. The best part is that they are, for the most part, passive. Once in motion, they run continuously, whether you tend to them or not. Once you have one, or several, passive income streams, the bulk of your time can be invested in increasing your income by refining the existing income sources or creating new ones—instead of merely maintaining your income.
The internet provides many opportunities for passive income streams. It may take some time to get up and running, but a good value-based website can create thousands of dollars every month while providing readers with great information and tips. Registering a domain name is relatively inexpensive, and most of the tools necessary to run the site (blog, shopping cart, etc) cost next to nothing. While you may not earn thousands at first, everything beyond your start-up investment is pure profit so what do you have to lose?
It is important to recognize that you don’t have to invent the light bulb to have something people will value. Look around and see what has already been successful. Go with a sure thing. Once you get it started, you won’t have to work so many hours to support yourself. You’ll be able to use that time to come up with even more ideas. Your local bookstore is filled with books containing workable systems that others have already designed, tested and proven effective. Nobody is born knowing how to start a business or generate investment income, but you can easily learn—and you are surrounded by the tools to do so.
It’s important to remember that you don’t have to hit the ball out of the park on the first swing. This isn’t all or nothing. If your first attempt only generates a few hundred dollars a month, that’s a significant step in the right direction. It doesn’t mean that it is all you can do, or the best you can do—it’s just the first step.
Because we’re conditioned to think that a traditional job is the best way to make money, we often get hung up on the idea that we must have experience to be self employed. Completely untrue. You gain experience from living every day and learning lessons that can be applied to every area of life—including creating income.
The problem with getting experience from a job is that you can only use the biggest part of that experience if you have another job that’s the same. In most jobs, you learn a substantial amount at the beginning but then stop and just continue to repeat the same tasks over and over. This creates a stagnant and frustrating cycle of repetition. This is one of the major causes of job dissatisfaction. Creating income that is unique and inventive stimulates the mind and keeps you interested in life.
Something notable and obvious in the corporate environment is the lack of passion. It’s as if employees have been beaten into submission. Whose idea was it that gray cubicle walls were the best environment for stimulating, efficient work? Let’s call them what they are: They’re depressing. It’s also demeaning to have your performance evaluated by your boss just to get a pittance of a raise every year. Who can say how much your time is worth, and more importantly, why should you have to prove it and then beg for a few scraps more?
Purely from a dollars and cents standpoint, you have to know that employee income is taxed on a higher percentage basis than any other. Business owners, investors and the self employed all are able to take advantage of tax breaks employees can’t access. Employers also consider additional taxes and benefits for employees to be part of your salary, even though it doesn’t go into your pocket. While your actual value may be quite high, once all of these costs and benefits are deducted, you get paid a very small portion. By becoming a business owner, even on a part time basis, it enables you to take advantage of these benefits.
Fear can be a powerful force, especially when you consider leaving the perceived safety of your traditional job. The fact is that safety is just perceived. If someone has the power to hand you a pink slip at any moment, then you are not safe at all. However, if you had several sources of income that no one could ever fire you from, you are in full control of your destiny and no one can take that away or change the rules without your approval. You can’t have security if you don’t have control; and employees have the least control of anyone.
How many times have you endured an irrational or uninformed boss? Or been frustrated by office politics? Or wondered why the least capable and most annoying employees always seem to get promoted? Being an employee can be extremely stressful. You dread Monday and can’t wait until Friday. You’re at the mercy of forces you can neither influence nor control and the lack of a creative outlet can be crushing.
This can have the same effect as poison on the mind and body. Your life and spirit can be so destroyed that you feel utterly worthless. This is why employees frequently refer to their work lives as “doing time.” It’s ironic so many would refer to their jobs with an expression normally used by prisoners. But these employees feel like prisoners—and the environment affects them in much the same way. Many corporate employees become institutionalized—just like prisoners, they refuse to believe there is a life outside the limited world they know.
The effect is made more acute by the fact that, for many people, jobs are the primary social outlet in their lives. Thinking of that social network can feel like leaving family. They have so much in common from the experience—both good and, usually, bad—that it can be difficult to have a conversation with anyone not employed by the same company. To break these ties and go out on your own is not just scary; it feels like you’re abandoning an entire group of people. In a way you are. You’re abandoning their paradigms and ingrained beliefs. And those not prepared for this change can quickly find themselves working a corporate job again.
But it’s unnatural to conform yourself to a corporate environment full of meaningless policies. The long list of rules that govern most people’s work life is so lengthy you would practically need an advanced degree to decipher it. Those who have learned to fit into this world can hardly believe there’s a place where that sort of regulatory governance doesn’t exist. They can’t imagine that they could make a living without someone standing over them to regulate how they dress, how they talk, who they talk to or what photos they have on their desk.
It’s easy for those who have escaped this kind of culture to be dumbfounded that so many view it as the safe and correct path. But with paradigms, social networks and fear to maintain the status quo, it can be extremely hard to break free.
If you are currently a satisfied employee, you might react negatively to this summation. But that resistance is a component of your paradigm. It is the Y idea smacking up against your X beliefs. However, you also know on some level that what I’m telling you is the truth—or you wouldn’t have any sort of response at all, let alone an emotional one. Maybe it all happened so gradually that you never noticed it; and now, it’s a general numbness of the mind.
If this makes you angry, that’s a good thing. Anger is a much stronger emotion than apathy. It’s certainly preferable to being numb. Any emotion—even fear—is better than apathy. If you work through these feelings and strive toward the truth, you’ll soon experience the courage to change.
Realize you earn income by providing value, not doing time. Find a way to provide value to others and charge a fair price for it. One of the biggest obstacles you’ll face is that you may not have any real value to offer others. You may assume that being an employee is the best you can do. Maybe you’re concerned you aren’t worth that much. This type of thinking is all part of your ‘get a job’ paradigm—and it’s complete nonsense. As you focus on your purpose and visualize your dreams, you’ll soon recognize that you have the ability to provide enormous value to others—and that people will gladly pay you for it. There’s only one thing that prevents you from immediately seeing this truth: Fear.
You are not your job. It does not define who you are or all that you have to offer. Your real value is based upon who you are, not what you do. The only thing you need to do is express your real self to the world. You’ve been conditioned to think this is unproductive or that you can’t make money at it. But you’ll never know true happiness and fulfillment until you find the courage to do it anyway. Learn to trust your inner wisdom, even if the whole world says you’re wrong. What do they know anyway? No-one knows you the way you do. Years from now, as you stand on the peak of your mountain, you’ll look back and realize it was one of the best decisions you ever made.
There are plenty of misconceptions about what it’s like to be self employed. Interestingly enough, most of these ideas come from people who have never been self employed! Again, the paradigms held by the masses have very little to do with reality. I often talk about the reality of self employment, because it means something different to almost everyone. This allows me to dispel a few of the myths and share the knowledge of those who actually know what it’s like.
It’s true that many self employed people work longer hours than employees. In large part, it’s because they enjoy what they’re doing. When you know your purpose and are focused on reaching your goals, it’s vastly different than sitting in a cubicle playing solitaire and waiting on five o’clock. You’re energized, productive and excited by the events of the day. You rarely mind putting in some extra time. You know the reward for that time will come to you and you alone—not to your boss or to some nameless, faceless shareholder. The great part about the hours you work is that it’s your choice. That flexibility alone is worth much more than a nine-to-five job can offer. If you don’t like working long hours, you certainly don’t have to.
The greatest stress most people face is when they can’t afford their basic needs. However, given the flexibility and freedom that self employment brings, it’s actually much less stressful than a full time job for several reasons:
• You chose when you work and where.
• You choose the people you work with.
• You decide when you take time off.
• You have the ultimate say over everything you do and don’t have to follow policies or procedures that someone else dreamed up.
• There are no performance reviews, probationary periods or vacation requests.
• You decide when you get a raise and how much you are worth.
• You have control over your life and determine what path you will take.
During the 1990s, many people started IT and software companies from nothing. They built them up for a few years and cashed out and made millions. This contributed to the idea that, in order to really make your fortune, you have to sell a company. While you can certainly build a business to sell or to take public, you can also build a business to keep that produces steady cash flow for a long period of time. The idea of passive income relies on this type of thinking. You can own multiple businesses at one time and collect money from them all.
You decide what kind of business you want. If you decide you want to be the next Bill Gates, that’s great—there are no hard and fast rules. The important thing to understand is that it has to get you to the top of the mountain, no matter what kind of business it is or what kind of cash flow it produces. You are free to choose and that choice opens the door to a multitude of opportunity.
Self employment brings up much talk of risk vs. reward. The bottom line is that human beings feel most secure when they have control. Self-employment gives you control over your income—far more than you have with a regular job. When you’re self-employed, no one can fire you or lay you off. If you need to come up with additional cash very quickly, it can be difficult to do as an employee. But if you are an owner who controls all the assets of your business, then you have the option to redirect resources to increase income should you need to. Self employment also allows you to diversify into other areas or sectors, so that if one income stream slows or disappears, there are others that remain unaffected. Employees are at the mercy of one master—and that master can eliminate your position on a whim.
As an employee, you must deal with your employer’s customers—whether you like them or not. Many corporations still live by the adage, “The customer is always right.” You and I both know that it’s not true. There are those customers who want everything free or who are convinced that the more they complain, the more attention and better service they’ll get. If you’re self-employed, you have the option to get rid of customers that waste your time. Some customers just aren’t worth having.
You have the ability to say no to anyone at any time. You are the boss. There’s no reason to put up with a customer who is threatening or insulting. In some businesses, bad behavior on the part of customers seems to be rewarded. But you don’t have to allow it! You make the rules. There’s no need to do business with people who think it’s their prerogative to treat you poorly. You won’t enjoy having them—and you won’t enjoy their referrals either.
We’ve touched on the idea that many people fear leaving the social network they’ve built as an employee. However, if all you do is spend time with other employees, then it won’t move you forward, will it? Most—if not all—the people I spend time around are self employed and interested in wealth generation. When you choose to become self-employed, you’ll develop new networks with people who can help you and who think as you do. A self-employed person has the time to network during business hours without worrying that they will be reprimanded for socializing too much.
There’s no need to feel isolated or alone if you’re self-employed. But it’s important to build new and strong relationships. You may find these relationships to be stronger than your previous ones; after all, they’re with energetic, positive and motivated entrepreneurs. You don’t get together to gripe about the boss or that memo from HR. You gather to talk about new ideas that can move you forward and make you even more money.
Self-employment can also allow you to socialize more freely with family and friends all over the world. Since you will no longer have to fit your visits into a long weekend or holiday.
Self-employed people don’t have to know how to do everything for a business to succeed—they’re just responsible for making sure everything gets done. Newly self-employed people sometimes have a hard time letting go. They find it hard to delegate. However, it’s essential if you want to use your time most effectively. Why spend time mowing the lawn when you could be working on a new source of income?
Some people try to make business ownership as difficult as they possibly can. Often, deep in their mind, they might still have the belief that earning money has to be hard. The truth is, it can be as simple as you chose to make it—but it’s definitely not hard.
Self-employment can also have the illusion of being very complicated. Taxes, legal organization, insurance and many other details of business ownership can seem overwhelming. There’s certainly a learning curve, but these aren’t complicated issues—especially for small businesses. As your business grows, you can pay for expert advice if you’re uncomfortable. Don’t let the initial learning curve intimidate or confuse you. Once you set up and learn the basics with your first business, all of that knowledge will be immediately applicable for you next business—and you will have one!—saving you time and money.
How much is very little? There are plenty of businesses that you can get into for a very small amount of money. As that business goes up in value, you expand your opportunities. This means you don’t have to put everything you have into a business up front to start earning cash. If you create value and provide something that others are interested in, you will profit. If you’re able to have a specific time investment and get paid repeatedly, then it can also create a steady source of passive income. A good example of this is to write a book. You expend the effort once and it continues to sell for years.
Think about how this sort of concept affects employees. Let’s pretend you’re a software developer. If you design a system while working for your salary, you get paid the same—whether that program is good or bad it doesn’t matter. If it works well, then your employer will make money from it for years. Meanwhile, you move on to develop their next money-making program, but you still get the same salary.
Contrast this with this idea: Develop your own programs and sell them to others. Now you create a new revenue source with each idea you create that benefits you for your entire life. When you look at the two scenarios, you are essentially doing the same work, but in one you get paid a set amount and in the other your income is limitless. All it takes is a good idea and a willingness to work. It doesn’t take large amounts of cash, and the rewards are tremendous.
No matter what I tell you or how convincing an argument I make, you still have to choose to set aside the doubts in your mind. I hope that some of these realities will help combat your fears and existing beliefs about what it’s really like to be a business owner. Lots of people have nightmares about starving to death on the path of self-employment, but such irrational fears aren’t representative of reality. Self-employment is a powerful catalyst for personal growth. Often, the greatest value comes from the lessons and self-confidence you gain along the way. You’ll never truly feel the exhilaration of being your own master until you finally let go of the perceived safety of a traditional job. Much like a baby who learns to stand by holding onto furniture, you must eventually be willing to let go in order to walk—and then run.
Fear of the unknown decreases over time. You become used to trusting your own instincts and judgment. But it will never disappear completely. Once you develop a wealthy mindset, though, you’ll be able to handle that fear and put it in its place. That’s when you’ll accomplish your goals.
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• Real change requires strong and continued commitment.
• Accountability increases your chance of success.
• Being successful is not an all or nothing mindset.
• Business ownership allows you to take advantage of significant tax breaks.
• You don’t have security if you don’t have control.
• Your real value is based upon who you are not what you do.
• Self-employment is a powerful catalyst for personal growth.
• To help others execute these ideas, investigate www.BobProctorMoney.com/LSC