Saturday, October 01, 2011

How to Become Financially Independent in Seven Years or Less

I am 59 and looking forward to a financially stable life. I can't complain, but I also want more in life. I feel I am just beginning to accelerate in my quest for financial independence. That's part of the reason why I blog. It helps me discover out-of-this-world ideas, opportunities and people. I learn from them.

Mark Ford, Editor of the Palm Beach Letter, son of a teacher, started out with no money but built a multi-million fortune.

If you are middle aged, whose net worth is meager,  and your income is barely sufficient to meet your expenses, this article is for you. He says that we should take responsibility for our situation and make changes. When we see our financial goal not aligning with our age, we are to take courage. Don't give up on your dream of being wealthy. Mark says that we always have the ability to change our financial life. But it will take a bit of time and patience.
Here are four things he suggests we do:

1. Accept the fact that you are solely and completely responsible for your financial situation. Nobody can change your future but you. The sooner you do that, the anger and blame will be dealt with and you begin to feel financially powerful.

2. Set realistic expectations. Don't be in a hurry to get rich. Be contented with 10%-15% returns per year. This is a journey and like a train, you can't go from 0 to 100 mph in no time flat. Be content with 10 and then 20 and soon you're doing 100. Your journey to millions of dollar is earned $100 at a time.

3. Thoroughly understand the difference between spending, saving and investing. Mark says that every paycheck you get cover your necessary expenses first, then put money on your savings and then put some money toward investments. Then and only then, after paying yourself, should you add to your spending.

4. Recognize that your net investible income (the amount of cash you have after spending and saving) is the single most important factor in determining how quickly you will become wealthy. Commit to adding to your income a second income.

I love the what he says about the value of time: devote your time to wealth building rather than spending time on non-productive hours like watching TV.

I am so happy to discover this very practical and doable tips from a man whose been there and came out successful. If Mark can do it, we can.

To your debt-free life,

P.S. I have changed the way I think. Blogging  about my passion, helped me gain not only personal but global economic realities.

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