Many Americans are having a conversation about money that needs to change if they want to become a millionaire. In fact, just the traditional phrase, “manage your money,” is thinking way too small. Traditional thinking about money is a model that plans for poverty. And it’s the wrong conversation. Instead of talking about “managing” our money, we should be talking about “growing” our money, about building our wealth. Christopher Columbus didn’t come across to America just for people to get jobs and have 401ks; he wanted to have freedom!
Everyone wants to become a millionaire. It’s the American Dream. Unfortunately, the conversation about reaching financial freedom is usually around “conventional wisdom” and driven by how we’ve been conditioned about money our entire lives. It’s about scarcity-thinking and scrimping-and-saving for a future when there might be hard times and cutting back on the things we love -- like a $3 latté, for instance. This is thinking small and planning for poverty. Who wants that?
Now, if you’re depriving yourself of a daily latté, then you’re trying to save $90 a month. That’s about minimizing, not creating and expanding. I have a better idea: Go create more money, learn to earn, so that spending $90 a month isn’t even an issue- let’s make some cash! I teach my clients how to use Wealth Cycle Investing. This is using your skills to build your own cash machines and then investing directly in double-digit-return assets. Yes, assets with double-digit returns: We do it all the time. Most people do what I call “Park and Pray.” They PARK their money in traditional Wall Street stocks, IRAs or 401(k)s and PRAY for financial security down the road. “Park-and-pray” is not what I call a good investment strategy and is a lousy conversation.
Why own oil company stocks when you can own the wellhead directly? Why own stock in a company when you can own the company. This is what direct investing is: owning assets and being involved in the operations, with higher returns and no middleman taking a cut of your money. I’m a fan of direct investing in real assets, ones you can see and touch and be a part of. The opportunities for direct investing and asset allocation are infinite. They could include rental properties and other real estate, businesses such as laundermats or oil and gas wells and even private debt instruments. Then, I take the income from these assets and invest in even more assets that yield more returns. Assets to income: Income to assets. This is the Wealth Cycle -- the secret to creating and sustaining wealth that the wealthy have used for generations. I’ve done it and so can you. I often hear, “I don’t have time!”, “It’s too hard” and “I don’t know anything about making money.”--and other objections. As a mother of two small children and the Founder and President of Live Out Loud, my wealth-building community, I too know what it’s like having a few demands. When people tell me they don’t have time, I tell them they need a team. Millionaires don’t clean their houses or mow their own lawns and neither should you. A housekeeper or lawn service could well be part of your team; you have to buy your time back.
Millionaires also surround themselves with a team of people who know more than they do. You should do the thing you love to do, and build a team to do the rest. Your team could also include a lawyer, accountant or marketing expert--whomever you need to fill the gaps in your expertise. Remember, there is no such thing as a self-made millionaire. It takes a team to make those millions.
Having a team also reduces your risks along the way. You will benefit from their experience, resources and gain access to the other professionals you will need on your team. Your job, as the leader of your wealth creation, is to find team members whom you like, trust and respect. AND those who want to have a different kind of conversation with you about money. It’s YOUR money, and YOU get to decide who’s on your team and what the conversation is going to be.
Getting your team together is critical, but just one part of building your wealth. There are also what I call the twelve building blocks of the Wealth Cycle. The first three are always the same: the Gap Analysis, Financial Baseline and a Freedom Day Plan. The Gap Analysis creates a model for you of where you are today and where you want to go. The Financial Baseline building block gives you an overview of your current financial situation--your income, expenses, debt and investments--everything is included. Your Freedom Day Plan is where you get to see the light at the end of the tunnel by defining your ultimate wealth objectives. Your building blocks become your wealth-building plan. Other building blocks include Entities, Wealth Accounts and, of course, Cash Machines. All twelve are described in my books. Get these right, and you can become a millionaire in 3-5 years. Really. I have worked with hundreds and hundreds of people across the country who have done this. And many started out right where you are today.
HOWEVER, you must do the right thing at the right time. You have to understand which building block sequence is right for you. The order of the building blocks in a wealth-building plan differs depending upon the person and his or her individual needs and objectives. Once you complete the first three building blocks, you will see the sequence for the rest that’s right for you. Sequencing is the foundation of the Wealth Cycle Process.
And finally, here is another conversation you won’t often hear: Yes, debt is a big issue for many. As I said, living small to pay down your debt first is a recipe for failure. I say build your cash machine first, launch your wealth cycle. Put yourself first--make more money THEN pay down your debt. Makes sense, right?
All of this we are talking about here is a different kind of conversation about money, one about leading your life, about thinking and living big, not small. Lead the life you want to, not a life you have to. So, get off the couch and get into action! Get in the right conversations. The more you do this, the more you will condition yourself to a new way of financial thinking. You will learn to act, think and make money the way millionaires do.
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I was born and raised on a farm in Nebraska and did not start out in life with money or connections. Today, I am a master coach and financial strategist. I built my first business in high school, and by the time I was 34, I had established a multi-million-dollar portfolio of properties, businesses, gas/oil and notes. I am committed to helping people create unimaginable success. I work to provide products and programs with substance, insight and applicable real tactics that can be implemented immediatly.Every Monday at Gather Essentials: Money you will find my exclusive article for the Gather community.As I continue to write on Gather, you will be able to find an archive of all my Gather content at http://gather.com/loral I encourage you to stay engaged in the conversation by joining my network. Simply visit my namespace and click on the orange "Connect" button on the left-hand side of the page.
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Loral Langemeier is the founder of Live Out Loud, a coaching and seminar company that teaches wealth building techniques. Learn tips from the financial strategist at The Millionaire Maker. Please join us by clicking here.
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Comments: 21
How are you? We met in Houston at the HNN expo. I receive your emails and I very much appreciate you being here to help keep us focused on the right way to approach wealth.
Thanks!
You know, one of the first things we do when someone is trying to decide on what their cash machine should be is to take a look at their skill sets. Your cash machine is not always a business that you have wanted to run your whole life. Many times the cash machine ideas come from matching your skills to a specific need , or market niche, within an existing industry. This past weekend was the launch of our very first Cash Machine Workshop. As a group, the participants came up with over 1,000 ideas for cash machines. We are sending this information to each of them. The next Cash Machine Workshop is not until June, but go ahead and read the book and then get signed up for that next workshop, so that you can get into your own wealth cycle!
Tyra, It's great to see your mind-set shifting to abundance rather than scarcity. I do not know of any housekeepers in the Austin area, but I will tell you the best place to look for housekeepers is referrals from other individuals on your team. It reduces the risk in this hire knowing that the referral is coming from a trusted source. Hope that helps!
Budgets are like diets. You need to think about creating more money, not restricting your life! What you need is a Cash Machine to bring in the money you need—and then invest it to bring in more.. Some people even keep their W2 jobs until they realize their Cash Machine is making them money faster and their time is better spent leading their Wealth Cycle. But you can do both. We just had our very first Cash Machine Workshop, and it was stunning; people were making money for their new cash machines right there at the event! Check out my new blog at www.liveoutloud.com/blog to see more about it.
Both are middlemen, taking a cut and lowering your return on your investment. One with fees, the other with commissions. At Live Out Loud we teach how to build a team to reduce risk and generate double-digit returns. Really! More on this in my books and at our Team Made Millionaire seminars, which are free. Check these out at my web site: www.LiveOutLoud.com.
See! You get it! Commitment and a plan to build one's own business—what we call Cash Machines in one's Wealth Cycle. Everyone's situation is different, but perhaps the time and energy spent on being frugal or budgeting would be better spent growing the Cash Machines and then investing directly to generate even MORE cash. But congrats to your grandfather and Mom's cousin. Maybe YOU should think about getting more people like them on your team?