In my 31 years full time in the Home Based Business Industry I have often witnessed some very successful people make a common mistake. The mishandling of their money. Especially when people who had once been struggling financially finally experienced some financial success.
The more they earn, the more they spend resulting in a zero or even a negative financial freedom growth.
As people experienced an increase in their earnings, they would also increased their spending, and often their debt. Having a gross earnings of $1,000,000 and a deb of $2,000,000 is no better than having a gross earnings of $30,000 and an debt of $60,000.
All of their money was spent on liabilities and left no money for investments. Fancy cars and homes are seldom an investment. They are almost always a liability. The difference depends upon whether the expenditure makes you money or costs you money.
A home might be considered an investment by many people, however the question is how much money is the home generating for you each month? If it is a property that generates more income each month than expense, like a rental property or apartment, then is an asset. If it costs more than it generates, it is a liability.
Sure you may be able to sell the apartment or home for more than you paid, but what about the expenditures for utilities, loan interest, improvements, taxes, etc?
So what should you do? Take some of that increase in earnings and put it to work for you. Have a plan B to protect you from the possibility that the residual income you have goes away.
Invest a portion of that money. Don’t just spend it. Protect your future income. Having multiple streams of income is a great insurance policy.
I have witnessed that on many occasions the investments would out produce the earnings from the home business. The money from the home business may pay for your current needs and wants, but the investment provides for your wealth and financial freedom?
So what to do with your available investment income? Put it where it will generate passive income. There a a lot of options;
- Invest in income generating real estate
- Invest in safe business ventures
- Invest in IRA’s or CD’s
- Invest in Gold
- Invest in Stocks
There are many different options and the one that is best for you can vary. Whatever you do, seek advice from a mentor who has proven success with the option.
It may not be the right choice for you but my choice is to invest in criptocurrency. Millions have been made with BitCoin and other criptocurrency. I have seen the value of a coin go from pennies to over $6,000. People like Bill Gates, Warren Buffet, Sir Richard Bransen strongly support these currencies. I have always said that to achieve success you must find a mentor whom has already achieved the success you desire, be coachable, and follow their advice. These three people fit the “Successful Mentor” guidelines.
If anyone would like to take a look at what Id am investing in, follow this link.