Why should I read this?

Once, there was a business manager in his 40s who was struggling with money. He made an appointment with a financial advisor to give him some advice. He went to the financial advisor’s office only to find two doors, a door that had “Employed” written on it and another door that had “Self-employed” written on it. He opened the door that said “Employed” because he was employed. When he opened it, he was greeted by another two doors, one was marked “makes less than $40,000 a year” and another door that was marked “makes more than $40,000 a year”, he made less than $40,000 a year, so he opened that door only to find another two doors, one marked “saves more than $2,000 a year” and the other one was marked “saves less than $2,000 a year”, he opened the latter since he only had $1,000 in his savings account. After opening that door, he found himself right back outside the office from where he first started!

The moral of the story is if you keep choosing the same choices that lead you back where you started, you’ll never move forward, you’ll always find yourself going right back to your first step. The only way to move forward is to choose different doors to get different results. Do you want to know how to do that? Then read this summary.

Chapter 1:
We Live in a World of Copycats:

If there’s one thing we’re all good at, it’s copycatting. The question is, since we copycat almost everything, why haven’t we found a way to copycat creating wealth?Copycatting starts from the day we’re born, we copycat the language of our parents, then we copy their moves, and their lifestyle, after that, we go to the school where we learn to write by copying letters. When we want to learn how to drive, we pay an instructor to teach us how to copycat him, and the better we copycat our instructor, the better we are at driving. However, like anything in life, copycatting has its downside: just because we all copycat something doesn’t necessarily mean it’s a good thing, take that into consideration when you find yourself copycatting a bad habit –   what if the person you’re copying is not right?
Look at this story: a man had a shop where he sold clocks.

Every day an old man would pass by the man’s store and look at the clocks, take out his pocket watch and then leave. The store owner got curious, so one day he went out and asked the old man what he was doing. The old man replied, “I blow the quitting whistle at 5:00 each day, and I want to be sure it goes off exactly on time.” The store owner laughed -he couldn’t help it -after he stopped laughing, he told the old man that actually he was the one setting his clocks every day at 5:00 to the old man’s whistle!They both were copycatting each other, they both thought the other person was right, their assumption was wrong.

So, the answer to the question, “Why haven’t we found a way to copycat creating wealth?” is because we have been copycatting the job track, not the wealth creation track. Why is that? Because most people assume that a job is the only way to make their financial dreams come true. Do you really want to copycat the 95% of people who are on the job track and probably get broke by the age of 65? Or, do you want to copycat the 5% of people who are on the wealth creation track and will become financially independent or even wealthy by the time they’re 65?

TO READ OR LISTEN COMPLETE BOOK CLICK HERE

Chapter 2:
What’s “True” wealth?

True wealth isn’t just the ability to buy things, true wealth is the ability to be free. True wealth is having enough money and enough time to do whatever you want, whenever you want. But, be careful here – having enough money is NOT enough, you’ve got to have enough time, too. Lost time can never be gained back, there are lots of highly paid doctors or engineers, but if you ask them if they’re truly free, the answer would usually be “No”, because they feel trapped. They know that if anything happened and they had to quit, they wouldn’t survive living the same lifestyle they were accustomed to.

This is called income creation, income creation is when you trade your time for money. You literally earn nothing unless you personally do the work: it’s a trap, or as the author likes to call it, “Time-For-Money Trap.”Income creation is temporary. Income creation does not last; once you stop working for any cause -let’s say an illness left you unable to work – how are you going to afford to live? I know you won’t be able to.Well then, how can you afford to live a luxurious life without being dependent on you going to work? The answer is residual income; residual income basically keeps earning money whether you show up to work or not -sounds fictional, huh?

Well, fortunately, it’s not fictional. Consider ‘John’: John lived the last 40 years, saving about 10% of his income and wisely invested it. After retiring, he had more than a million dollars invested. These investments earn him 10% per year  (4100,000) without him doing any work. Now, that’s true wealth.

TO READ OR LISTEN COMPLETE BOOK CLICK HERE

Chapter 3:
Trading your time for money:

These days, we have a 50/50/50/50 plan: we work for 50 hours a week, 50 weeks a year for 50 years, and when we retire, we get 50% of what we used to make. The problem is that what we used to make wasn’t even enough. Imagine if it’s only 50% of it, what will we do when we retire?
This is the basic example of linear growth. To simply calculate linear growth, we use the following equation:H (hourly wage) x N (number of hours worked) = I (income)

It simply means you get out only what you put in, and if you didn’t put in enough, you won’t get out enough.Let’s look at an example to explain the limitations of linear growth.Consider two people with two different jobs;let’s name the first one, John. John sells flowers. He earns $10 an hour (after removing the money he has to spend on transportation from and to his work). If he was lucky enough to work 10 hours a day, 6 days a week, he would earn $600 per week. If he worked 50 weeks every year, he’d earn $30,000 per year. That’s not bad, and most people wish they could earn that much. However, that $30,000 a year is John’s maximum income, he can never make more than that.

Also, he doesn’t get to spend enough time with his family, he never really takes a break, and his income is based on linear growth, so he only gets paid once, and once he gets paid, he’s back again in the race. He has to trade his time for money again to earn enough.The second person is Mark. Mark is a general practitioner of medicine, he earns $150,000 a year; that’s a lot. However, he still has to work 10 hours a day, 6 days a week – he’s a prisoner of his own work: he gets back home tired, unable to spend time with his kids, he isn’t exactly living the life he has always wanted. That’s the problem, no matter how much you make, whether it’s $30,000 per year or $150,000 per year, once you stop working, you earn nothing.

A company’s CEO earns a lot, maybe even 3 million dollars a year, while his employees only earn 20,000 dollars a year; why is that? That’s because the CEO knows how to leverage his money; his employees are his leverage, he’d rather earn 1% of 100 employees’ effort than earn 100% of his own effort, and that’s leverage.However, it’s not enough to have leverage, and you also need to know how to use that leverage.Otherwise, it’s useless. That’s what we’re going to learn in the next chapter.

TO READ OR LISTEN COMPLETE BOOK CLICK HERE