In order to run you have to first learn to walk. To make a million dollars, you’ll first have to make 100K. I didn’t build my wealth overnight, but I did get rich rather quickly. There is a big difference between being wealthy and being rich by the way—more on that later. Right now, let me ask you, do you know the basic building blocks of money? Without the basic building blocks, you will never have mastery. I’m a hecto-millionaire and believe me, nobody that inherited their money has ever become a hecto-millionaire without straight up mastering money.
I want to give you three secrets today that the wealthy know that the rest of society doesn’t. These things are basic building blocks of money.
#1 Income is King—If you don’t have new income, you’re dead. You have to be getting new income. I know this sounds basic—because it is—but a lot of people have this confused. People are out there trying to save money, talking about how debt is bad and save, save, save. Look, if you don’t have income then there is no money to save, no money to retire, and no money to invest. There is no chance of wealth without income first. You might hear people say, “Income is not what you want—wealth is what you want.” But you can’t get to wealth without income. You need income. I’ve said that a JOB means just over broke, but a job=income. The reason people get a job is to get income. Now the question becomes, how much income can you protect? How much can you incrementally increase that income? Understand this—don’t let anybody ever tell you that income isn’t king. Saving is not king, spending is not king. Income is KING. And that is the number one most basic building block you need. Yes, it’s taxed at a high-rate—it’s not the best thing, it’s not the thing I ultimately want to be at—which is wealth—but, I have got to have income to get to wealth.
#2 Income Increments—You aren’t going to go from 4K a month to millionaire. There is going to be incremental growth. Now I’d certainly like to explode and go 10X but understand that there are going to be increments. At 25 years old, I was making 4K a month and all I could focus on was increments. I thought about how I could take that 4K and control it by going up to $4400. Could I increase it by 10%? That would be $400 more per month. That’s $100 a week, $80 a day. Who do I need to see, who do I need to call to get that $80? At 35 years old it wasn’t going from $4,000 to $4400 but going from $15,000 to $20,000. That doesn’t mean I’m not thinking about how to explode with growth, but every day, every week I’m thinking about how to increase in increments. Think about it this way—do you want more or less? There is no same. Same always falls to less. You’ll get what you focus on. If you focus on anything else other than more, you’ll get less. You’ll end up with less money, less income, less ability to save and invest money.
#3 Spend 95% of your time on income, 5% on expenses—Take out your household income statement. Everyone has one, money that comes in and money that goes out. The line for incomes is thin, the line for expenses is thick. Income is powerful. You need enough income to overwhelm the expenses. Most people have this in reverse—they spend most of their time on expenses and little time on income. How much time do you spend on the income side? If you are anything like the average American, you are spending all of your time on the expenses.
Would you like to know the difference between being wealthy and being rich? People can get rich quick, but nobody gets wealthy quick. I figured out how to create wealth—I’ve become a millionaire over a hundred times over. Having wealth is having so much money it can never all be spent or destroyed. In order to get wealthy, you have to first get rich.
Trust me, it’s easier to get rich once than stay poor forever. Income is king, so keep increasing your income by increments, and keep yourself focused on your income—not your expenses.