Today's Lesson Is On Price vs Value.
When you purchase anything you must ask yourself three questions. If you cannot answer "YES" to all three questions, you may need to re-evaluate that particular purchase.
The Three Questions Are...
1. Do I want it? (yeah, probably)
2. Do I need it? (not really)
3. Can I afford it? (sure, but what value is it?)
Example: What Do Poor People Buy on Pay Day?
After meeting their basic necessities, they buy stuff. What is stuff? It's non-essential brick-a-brack, mostly junk from yard sales, flea markets, and Walmart. Their homes are full of stuff. Every wall, every table filled to overflowing with stuff.
16 Money Wasters
Nothing wrong with buying stuff, but after years of buying stuff, how much money do they have saved for retirement? When was the last time they took a really nice vacation? On the other hand, what do rich people buy on pay day? They buy something that will make them more money.
True story... Warren Edward Buffett (one of the richest men in the world) was born on August 30, 1930, in Omaha, Nebraska. Buffett's father, Howard, worked as a stockbroker and served as a U.S. congressman. His mother, Leila Stahl Buffett, was a homemaker. Buffett was the second of three children and the only boy. Buffett demonstrated a knack for financial and business matters early in his childhood. Friends and acquaintances have said the young boy was a mathematical prodigy who could add large columns of numbers in his head, a talent he occasionally demonstrated in his later years.
Warren often visited his father's stockbrokerage shop as a child, and chalked in the stock prices on the blackboard in the office. At 11 years old he made his first investment, buying three shares of Cities Service Preferred at $38 per share. The stock quickly dropped to only $27, but Buffett held on tenaciously until they reached $40. He sold his shares at a small profit, but regretted the decision when Cities Service shot up to nearly $200 a share. He later cited this experience as an early lesson in patience in investing.
By the age of 13, Buffett was running his own businesses as a paperboy and selling his own horseracing tip sheet. That same year, he filed his first tax return, claiming his bike as a $35 tax deduction.
In 1942 Buffett's father was elected to the U.S. House of Representatives, and his family moved to Fredricksburg, Virginia, to be closer to the congressman's new post. Buffett attended Woodrow Wilson High School in Washington, D.C., where he continued plotting new ways to make money. During his high school tenure, he and a friend purchased a used pinball machine for $25. They installed it in a barbershop, and within a few months the profits enabled them to buy other machines. Buffett owned machines in three different locations before he sold the business for $1,200.
Buffett enrolled at the University of Pennsylvania at the age of 16 to study business. He stayed two years, moved to the University of Nebraska to finish up his degree, and emerged from college at age 20 with nearly $10,000 from his childhood businesses.
So... what are you buying on pay day? Even if you can only afford something inexpensive... like a part time home-based business with real value.
The long term benefits are well worth the effort. Invest in yourself unless, of course, you think it's a bad investment. In that case, keep on buying stuff.
Our company helps Online Marketers learn how to earn residual income no matter which company they promote. That's value!
Let's review... What's the difference between a rich person and a poor person?
Answer: Poor people work for money. Rich people's money works for them.
Creating residual income is not a mystery, it's a formula.