1st Elamant

THERE HAVE NEVER BEEN more opportunities for you to become wealthy, and more different ways to achieve it, than exist today. More people are starting more businesses in more different industries than ever before. More knowledge, information, and technology are creating more products and services that people want, need, and are willing to pay for.

One new idea is all you need to start a fortune. In the year 1900, there were 5,000 millionaires in America, after almost two hundred years of economic development and growth. By the year 1980, there were 1 million millionaires in America. In 2015, there are more than 10 million millionaires and 1,826 billionaires, most of whom started with nothing and earned all their money in one lifetime. And within reason, so can you.

THE BETTER YOU THINK, the better results you will get and the more successful you will be in every area. The most important measure, the only measure of the quality of your thinking, is the results you get, the consequences of what you decide to do as a result of the decisions you make. Milton Friedman, the economist, once wrote, “The best measure of quality thinking is your ability to accurately predict the consequences of your ideas and subsequent actions.” His point was that economic theory divorced from what actually happened when that theory was applied was clearly incorrect. Consequences are everything!

The only question is, “Did your idea work or not?” Some people are confused about the importance of long-term consequences. They think that their intentions are most important, not the results. This is a major cause of confusion in our society today. They say, “If I intend for good things to happen as the result of my ideas, my decisions, and my actions and they don’t, you can’t blame me.”

Your ability to accurately foresee and predict the consequences of your decisions and actions is the true measure of your intelligence.

What Is Intelligence?

Intelligence is not a matter of IQ, grades in school, or years of study. Intelligence is instead a “way of acting.” This means that if you act intelligently, you are smart. If you act stupidly, you are stupid, irrespective of grades or measures on IQ tests. What, then, by definition, is an intelligent act? The answer is simple. An intelligent act is something you do that moves you closer to something you really want.

A stupid act is something you do that does not move you closer to something you want or, even worse, moves you away from it. You personally define a smart or stupid act when you decide what you want and what you don’t want. As Winston Churchill said, “I long ago stopped listening to what people said. Instead, I look at what they do. Behavior is the only truth.”

Action Is Everything

How can you tell what a person really wants, thinks, feels, believes, and is committed to? Simple. You just look at his or her actions. It is not what people say, wish, hope, or intend that counts. It is only what they do, and especially what they do when faced with temptation or put under pressure. Someone says, “I want to be successful in my career and in life.”

He actually believes it. But then you observe his behavior. This person arrives at work at the last possible minute, leaves at the first possible minute, and hurries home so that he doesn’t miss the latest episode of his favorite television show. Clearly, based on his behavior, his goal is not to be successful in his career but rather to watch television. How do you know? Because that is exactly what he is doing, every night after work.

Did It Work?

The only real measure of your decisions and action is “Did it work?” Did your action, based on your thinking, move you toward something that you wanted or something that is important to you? There are two laws that trip people up all the time, in personal life, in politics, and in international affairs. They are the Law of Unintended Consequences and the Law of Perverse Consequences.The economist Henry Hazlitt, in his classic Economics in One Lesson, wrote that human beings are self-seeking.

Therefore, every action is an attempt to improve one’s conditions in some way. People always seek the fastest and easiest way to get the things they want as soon as possible, with little consideration of secondary consequences. Hazlitt said that the desired result of any action is always an improvement in conditions of some kind. The improvement is the primary consequence aimed at. It is always positive. All action is focused on improvement of some kind.

Consider the Consequences

But it is the secondary and tertiary consequences—what happens afterward and after that—that are most important. The Law of Unintended Consequences says that in many cases an act or a behavior brings about immediate positive results, in the short term, but the long-term consequences can be quite negative.

For example, a young man quits school to take a job to earn cash so that he can buy a car, socialize, go out with girls, and have an enjoyable life. These are all positive and immediate aims and goals that young people want to enjoy. However, the consequences of a lack of education are often a lifetime of depressed earnings, little upward mobility, and the strong likelihood of the individual’s never reaching his or her full potential. Creating Something Worse The Law of Perverse Consequences is what happens when the results of an apparently positive action turn out to create a situation that is far worse than if nothing had been done at all.

For example, the immediate benefit of giving money to people who need it in our society is to help them and provide for them in the short term. The perverse consequences can be that the individual becomes addicted to “free money,” drops out of the workforce, becomes dependent on handouts, and loses his pride, self-esteem, and self-respect. The individual ends up much worse off than if nothing had been done at all. In society, the primary reason for social programs, giving money to the less fortunate, is always an attempt to help them to improve the quality of their lives. But the perverse consequences can become a lifetime of dependency and frustrated potential.

Think Ahead

In chess, with many pieces and many possible moves, your success is based on your ability to accurately anticipate or predict the moves of your opponent. In life, your success is largely determined by your ability to “play down the chessboard” and to make those moves that lead to ultimate success or victory— however you define it. Dr. Edward Banfield of Harvard studied upward social and economic mobility in the United States and other countries for almost fifty years.

He was looking for the reasons why some individuals and families moved up from lower socioeconomic classes to higher socioeconomic classes, generation by generation, sometimes starting at laboring jobs and becoming wealthy in one lifetime. Why did this happen to a small group of people and not to others? Today, in 2015, in the United States alone, there are more than ten million millionaires, most of them self-made; that is, they started with nothing and passed the million-dollar mark in the course of a single working lifetime.

In addition, according to Forbes magazine (March 2015), there are 1,826 billionaires, with 290 new billionaires in 2015 alone. Sixty-six percent of these billionaires are first generation, self-made. They started with nothing and earned it all in one lifetime.

The Common Denominator

Banfield wanted to know the common denominator of these people worldwide. He summarized his findings in a remarkable book, The Unheavenly City, which was widely criticized and quite controversial. It flew in the face of what many people wanted to believe, that poverty and welfare were largely inflicted on innocent victims who had no choice or control over what had happened to them. His conclusion was simple and largely irrefutable. In diagnosing the economic success or failure of individuals, he concluded that “time perspective” was the overwhelmingly important factor.

Banfield divided society into seven classes from the lowest to the highest: lower-lower class; upper-lower class; lower-middle class; middle-middle class; upper-middle class; lower-upper class; and upper-upper class. It turned out that at each level of socioeconomic achievement, the individuals practiced longer and longer time perspective. Regardless of where they had come from, their level of education, or their current situation, their time perspective was the only consistent difference in their conditions.

Time Perspective and Income

At the lowest socioeconomic level, lower-lower class, the time perspective was often only a few hours, or minutes, such as in the case of the hopeless alcoholic or drug addict, who thinks only about the next drink or dose. At the highest level, those who were second-or third-generation wealthy, their time perspective was many years, decades, even generations into the future. It turns out that successful people are intensely future oriented. They think about the future most of the time.

Peter Drucker said that the primary job of the leader, especially in business, is to think about the future; no one else is tasked with that responsibility. This is your responsibility as well. The top people in every society projected years, even decades into the future when they made their day-to-day decisions. They thought carefully about what might happen before they made important or irrevocable commitments. Here is a great discovery:

The very act of thinking long term sharpens your perspective and dramatically improves the quality of your short-term decision making. Because “you become what you think about,” the very act of long-term thinking changes the way you think and act in the present, thereby increasing the likelihood of greater success in the future.

Determine Your Future Intent

In 1994, Gary Hamel and C. K. Prahalad wrote a breakthrough book on business strategy titled Competing for the Future. In this book, they popularized the concept of future intent. They wrote that the greater clarity you have regarding where you want to be in the future, the easier it is for you to make correct decisions in the present. One of their most popular ideas was that if your goal is to be a leader in your industry, you must project forward five years and ask yourself, “What skills, abilities, and competences must we have five years from now in order to be one of the top companies?”

When you have clear future intent, future orientation, it becomes much easier for you to think with greater clarity, to make those decisions today that will enable you to achieve your long-term goals. The critical word in long-term perspective is “sacrifice.” Successful people are willing to sacrifice, to delay immediate gratification in the present, in the short term, to enjoy greater rewards in the future—in the longterm.

Without the willpower and discipline to engage in “short-term pain for longterm gain,” little success is possible.

The Retirement Crisis

Today in America, and in other countries, we have what economists call a “looming retirement crisis.” Ten thousand members of the baby boomer generation are reaching retirement age in the United States alone each day. According to the New York Times, the average savings of a married couple reaching retirement is only $104,000. This amount has to last for fifteen to twenty years in retirement. At a withdrawal rate of 4 percent (recommended), the average retired couple can draw down $4,160 per year, $346 per month, for the rest of their lives, plus Social Security. And $104,000 is the median size of accumulated savings.

Fifty percent of retirees are above that number, and 50 percent are below. Some retirees have no money at all saved up. How could this happen in the most affluent country in all of human history? The answer is clear—lack of time perspective. Millions of people got into the habit early of spending everything they earned and often more throughout their lives. Today, fully 70 percent of adults live from paycheck to paycheck.

They have nothing left over. They complain that they have “too much month at the end of the money.” They were and are lulled into believing that their spendthrift habits would never catch up with them.

The Millionaire Next Door

Many millionaires and multimillionaires today are average middle-class earners, living in average homes in average neighborhoods. Many of them are teachers, truck drivers, and salespeople. But they saved 10–15 percent of their income throughout their working lives and are now wealthy and comfortable. With the miracle of compounding, an investment of $100 per month from age twenty-one to age sixty-five at 7 or 8 percent, the average of the growth of the stock market for eighty years, would amount to more than $1 million in savings.

The development of long-time perspective, of projecting into the future five or ten years, or even longer, changes the way you think and act in the present.

Double Your Income

In Cameron Herold’s book, Double Double (2011), he shows you how to double the size of your business in three years. His message is simple: He advises you to project forward three years into the future and decide to earn twice as much as you are earning today by that time. This amounts to an increase of 25 percent per year compounded.

Then work back to the present, and determine the exact steps you will have to take to achieve this goal. If you increase your income or grow your business by 2 percent per month, 26 percent per year, you will double it in three years. If you are working and you increase your productivity, performance, and output by one-half of 1 percent per week, this will translate into 2 percent per month, 26 percent per year, and a doubling of your income in thirty-six months.

Back from the Future

The starting point of developing long-term time perspective is for you to practice “back from the future” thinking. Imagine you could wave a magic wand and make your life perfect sometime in the future. What would your perfect life look like? How would it be different from today? Then come back to the present and ask, “What would have to happen, starting today, for me to create my perfect life sometime in the future?”

Practice idealization. Imagine that there are no limits on what you can accomplish sometime in the future. Analyze your life in the four most important areas:

(1) business and career;

(2) family and relationships;

(3) health and fitness; and

(4) financial independence.

Project forward five years and imagine that your business, career, and income are ideal in every way. How much would you be earning? What sort of work would you be doing? Where would you be in your career? What kinds of people would you be working with?

YOUR FIVE-YEAR FANTASY

Peter Drucker said, “People often overestimate what they can accomplish in one year. But they greatly underestimate what they could accomplish in five years.” Once you are clear about what your ideal career and income would be five years in the future, look back to the present, and decide the steps you will have to take to get from where you are today to where you want to be in the future. Then take the first step. The good news is that you can always see the first step. You don’t have to see every step on the staircase to begin climbing. You just have to take the first step. And when you take the first step, the second step will appear. And when you take the second step, the third step will appear. You will always be able to see one step ahead, and that’s all you need. But you must take the first step.

Confucius said, “A journey of a thousand leagues begins with the first step.” The first step is always the hardest. It requires tremendous determination and willpower for you to do something more than and different from what you have ever done before. But once you take the first step, the second step is easier. And then the third step. Soon, you find yourself moving steadily forward, accomplishing more in a few months than you might have accomplished in past years.

YOUR FAMILY AND RELATIONSHIPS

Wave your magic wand again, and imagine that your family and relationships were ideal in every way. What would they look like? Whom would you be with? Whom would you no longer be with? If you were married, what kind of a home and lifestyle would you have with your family? What sorts of vacations would you take, and what kind of a life would you want to provide for your family? Then look back from the future to where you are today and ask, “What would have to happen, starting today, for me to create my ideal life sometime in the future?”

EXCELLENT PHYSICAL HEALTH

Think about your health and fitness. If your health was perfect sometime in the future, how would it be different from today? What level of fitness would you enjoy? How much would you weigh? What sort of diet would you eat? What sort of exercise regimen would you be following? What kind of rest and relaxation would you practice, including vacations?Then come back to the present and ask, “What would have to happen for me to enjoy superb health and fitness sometime in the future?” Then take the first step. Do something. Do anything. Step out in faith. And you can always see the first step.

FINANCIAL FREEDOM

The fourth area of concern is your achievement of financial freedom, financial independence. Project forward into the future and ask, “How much money would I need to have to be comfortable sometime in the future?” In my seminars with business owners, we teach the concept of “the number,” which was also the name of an excellent book on the same subject. It simply asks, “What is your number?”

What is the specific amount that you want to earn, save, invest, and accumulate over the course of your working lifetime? Especially, exactly how much will you need to support your lifestyle on a month-to-month and year-to-year basis? There is a simple formula for financial independence. First, determine exactly how much it would cost for you to support your current lifestyle for one month if you had no income at all. More than 70 percent of adults are unsure and unclear about exactly how much it costs them to live on a month-to-month basis.

ANNUAL EXPENSES

Once you have determined your monthly requirements, which may take a bit of investigation into your current expenses, regular and unexpected, you multiply this number by twelve to determine how much you would have to have saved up or invested if you had no income for an entire year. If you need $5,000 per month after taxes to support your current lifestyle, multiplied by twelve, you would need $60,000 per year to be comfortable if you had no income at all.

Finally, multiply your annual amount by twenty—the approximate number of years that you and/or your spouse are going to live after you retire. To continue with this example, if you need $60,000 per year to live comfortably, multiplied by twenty, you would need $1.2 million to retire at your current standard of living. (You can deduct any pensions that you might have coming from your monthly/annual requirement.)

TAKE THE FIRST STEP

Then take the first step. Open a retirement account, a financial freedom account. This is an account into which you deposit money and never take it out, for any reason. Seek out the services of a financial adviser. Learn to live on 85–90 percent of your income and save or invest the balance. Set this as one of the most important goals of your life, to achieve financial independence and hit your “number” at a specific time in the years ahead.

The very act of determining your number, making a plan to achieve it, taking action on your plan, and continuously saving and investing will increase the probability that you achieve that number sometime in the future by as much as ten times. Make a Decision Resolve today to develop long-time perspective. Become intensely future oriented. Think about the future most of the time. Consider the consequences of your decisions and actions. What is likely to happen? And then what could happen?

And then what? Practice self-discipline, self-mastery, and self-control. Be willing to pay the price today in order to enjoy the rewards of a better future tomorrow. And then take the first step. The dividing line between success and failure is not good intentions, hopes, wishes, and dreams. It is deciding what you want in each key area of your life and then taking the first step. And you can always see the first step.

ACTION EXERCISES

1. Resolve today to think long term, to consider the likely consequences of a decision before you act.

2. Project forward three to five years, and imagine that your life was ideal in every way. How would it be different from today?

3. Decide upon one action that you are going to take immediately to create your ideal future. And then take the first step

Men are anxious to improve their circumstances, but are unwilling to improve themselves; they therefore remain bound. The man who does not shrink from self-crucifixion can never fail to accomplish the object upon which his heart is set. This is as true of earthly as of heavenly things. Even the man whose sole object is to acquire wealth must be prepared to make great personal sacrifices before he can accomplish his object; and how much more so he who would realize a strong and well-poised life.

Great things take time but iqiniso lithi akugcineni kuyenzeka

The purpose of this page is to decrease the rate of un enployed youth thank you