“Why working hard is not getting you anywhere… and how you can change it!”
I’d like to share with you something I’ve learned from a friend last week. It’s about taking a good look at our lives and seeing where it’s taking us. It’s about seeing life in a new light – a new AWARENESS and a PARADIGM SHIFT.
He told me about the FOUR BUCKETS PRINCIPLES.
You see, most of us started out living our lives with two buckets.
The first bucket is called the Cash-flow bucket. We work hard everyday trying to make ends meet; making sure that we earn enough for our daily and monthly expenses, such as food, clothing, going to the movies, having a good meal once in a while at a fancy restaurant, paying the rent – in short, meeting the day-to-day living expenses. At the end of the month, whatever little we have left becomes our savings.
The second bucket is our Dream bucket. It is a pretty common dream that most ordinary people have, such as owning a house of our own, a reasonably decent car, and perhaps even an occasional travel to see the world we live in. We may even dream of retiring early.
In order to fulfill our dreams, we apply for loans from banks and other financial institutions to purchase our dream house and car. When we do that, we created the third bucket called the Liability bucket. The moment we do that, we turn our dreams into a nightmare. We end up working for the banks or the financial institutions that we borrowed from since a part of our earnings goes into servicing the loan. A big chunk of our salary goes into servicing just the interest for the loan. We’re not forgetting also that we are partially working for the government as well – we pay taxes.
You can see from here that the Liability bucket is NOT good for us; the bigger the loan, the bigger the liability. We could end up working our whole life for others.
That pretty much sums up most of our lives at this point in time. So, is there anything we can do about it?
Yes, there is. We can take the easy way out by downsizing our dreams or we can get ourselves out of this vicious cycle by creating the fourth bucket.
The fourth bucket is called the Asset bucket. We have got to get a tool or business that will generate profit for us. Unlike the Liability bucket that is full of holes and drains away our savings, the Asset bucket has no holes. It just stores and generates more savings for us. Naturally, the bigger this Asset bucket is, the better.
This brings us to the next problem. Most of us are either working as an employee or if you are more fortunate, self-employed. And we just do not see how we can create an Asset bucket that is big enough to stop the drainage from our Liability bucket, even though we know that we have to throw the Liability bucket away somehow. So, is there a way out?
Again the answer is YES. In order to show you the way out, you’ll have to understand the ESBI quadrant.
ESBI stands for Employee, Self-employed, Business Owner and Investor.
Most of us are either working for others as an employee or working for ourselves as a self-employed person. In fact, the majority of people on this planet fall into the E quadrant, the employee. Those who are more “fortunate” are self-employed. These two groups make up almost 95% of the population.
Obviously, they are NOT the millionaires. That’s because these two groups of people work for money. If they don’t work, they don’t get paid. It’s as simple as that. This includes professionals like doctors.
The next two groups of people make up only about 5% of the population. They are the businesspersons and investors. THEY are the millionaires and billionaires of the world.
Why? The answer is because they don’t work for money.
Instead, they let money work for them. The businessperson doesn’t need to be there and the business still goes on to generate profits for him or her. It’s the same with the investors.
In fact, they are the ones who truly have Financial Freedom. They have the time to do the things they like to do, and the money to do it. They are not slave to their work. This is called working to create wealth, where “wealth = money + time”.
Some people have the money but not the time to spend it, so they cannot be said to have freedom of choice. If they choose to travel instead of work, they lose their earnings. This is especially true for most professionals.
That means that in order to achieve Financial Freedom, we must shift ourselves from the E and S quadrants to the B and/or I quadrants. The first step to achieving this is to change our present mindset from that of an employee or a self-employed person, to one of a businessperson or an investor.
This is called a paradigm shift, and is perhaps the MOST important step to achieving Financial Freedom. Without this change in mindset, we will forever be working for money, instead of letting money work for us.
Once we have changed the present mindset, we need to learn as much as we can about business skills and investment skills. It is here that you begin to acquire financial intelligence. The best way to do that is to get involved in a business of your own. And the best type of business is one that requires small start-up capitals with potentially big returns. That is why MLM and network marketing is so popular and so successful.
I’m not asking you to join MLS but you should take a good look at opportunities that come your way. Don’t just dismiss them. Learn as much as you can from them. Perhaps you might find one that suits your beliefs and interest. In any case, start acquiring your financial intelligence NOW.
So, go ahead and make a difference to your life TODAY. In ten years time, do you still see yourself slaving at your job or would you be among the 5% in the world enjoying true freedom of choice? Will you be living your dreams or downsizing it?
The greatest part is….the choice is YOURS!
Tim Ong is a medical doctor and author of the online “Build From
Within” newsletter series. He is also the webmaster of The Self
Improvement Site (http://www.theselfimprovementsite.com) and Caring
For The Terminally Ill (http://www.caring-terminally-ill.com). You
may sign up for his free newsletter at
http://www.theselfimprovementsite.com/signup.html.
