The Money Management System That Beats Them All (Part 4)

Learning a system for money management should be mandatory for every child going through the public education system. After all, whom do you know who won’t be dealing with money throughout their life?

And certainly by the time you’re an adult, you must have a system to manage your money if you ever hope to become financially free. Unfortunately, for 95% of us, we never learn a money management system, and as a result, most never even come close to reaching their full financial potential.

Having a proven system to follow takes all of the guesswork out of trying to figure out what to do and what NOT to do when it comes to your personal finances. You simply do what the system tells you to, and as long as you do, you can feel secure in the knowledge that you will be an excellent money manager.

You will also need to make certain that you’ve developed the right attitudes when it comes to your use of money.

Here’s a simple rule. You either choose immediate gratification or financial freedom, one or the other.

One of the biggest distinctions between rich people and poor people is that rich people think long term. Wealthy people always think long term. Poor people always think short term and immediate gratification. I can virtually always size up people very quickly just by asking them if they are a long term or short term thinker. I’m able to predict rich or poor, just like that.

Now, on to the 4th account in our money management system. The next one is necessities. Either 50% or 55% of every check you get will go into this account, and I’ll tell you the distinction in one of my next posts.

Out of our $100 how much is going into our necessities? $55. Now that’s quite a bit isn’t it?

What are some examples of your necessities here?

Your mortgage or your rent. Your food. Your utilities. Your telephone. A reasonable amount of clothes. Your daily cup of coffee. Your makeup. Gas. Your gym membership.

Understand?

Basically all of your major things and the minor things that you get are necessities except for the items in the other accounts that we’re talking about here.

Now, here’s the thing. What if you can’t live on 55% of your income?

SIMPIFY.

First of all, you can learn to live on less. And you’ll have to learn to live on less because you don’t have a choice. What choice do you have? Either you win the game or you lose it.

Look, you’re either playing to win the money game, or you’re playing to lose the money game. You’re going to play one way or the other. Got it?

If you do this system you’ll win the money game. If you do something different, if you continue to manage money your way, the chances are real good that you’ll get your results. And maybe they haven’t been the results you want them to be.

When I was running Peak Potentials, one of our students had a $20 million net worth. He did the Millionaire Mind Intensive program in Vancouver. After learning this money management system he wrote to tell us what an impact it had on him.

First of all, he realized that the $20 million he had, it was total luck that he still had it. There was no rhyme or reason for it. And sure enough, as soon as he came to our program, he realized that he didn’t even know what he was doing with his money, that it was being wasted, completely underutilized, totally mismanaged, and the worst part was that he was showing his kids how to do that. And he’d been thinking, here he’s going to leave his kids $20 to $50 million dollars when he dies, and all they’re going to know is how to blow it. Underutilize it.

Now he says his net worth is growing by almost a million dollars every couple of months, and he’s utilizing it to great purposes here, and best of all, his kids are watching how to use money.

Also, you have to realize that a lot of things that you were using your money for, your necessities, aren’t going to be coming from this jar anymore.

What’d you used to do?

You wanted to go on vacation, where would you go? 3rd base.

The kids are going to go to College? 3rd base.

You need $50,000, where’s it going to come from? 3rd base.

You want to make an investment, where do you go? 3rd base, take it out of 3rd base. Everything was coming out of 3rd base. Now you have separate accounts specifically designated for specific tasks. Do you understand?

So a lot of things that you are utilizing your money for won’t come from the necessities account anymore.

Now let me say this. Note that these are the basic percentages. These percentages can change based on your income level. In other words, if you’re the kind of person who makes $500,000 a year maybe you don’t need $250,000 or $300,000 a year into your necessities. Right?

Also, even if you simplify your lifestyle, you might still find it next to impossible to live on 55% of your income. Don’t give up on this system! I’ll be addressing this issue further in one of the next posts.

Right now, the most important thing you can do for yourself is LEARN and UNDERSTAND this money management system. Keep an open mind and remember that there are solutions to all of your issues.

This money management system works! Learn it as if your financial life depends on it, because it does.

Namaste.

Jeff