Have you ever come across someone that seems to have a natural gift at making
money do you want to emulate their success but aren't sure how well in this
video i will share with you five proven ways to become a money magnet and if
you're new to the channel then hit the subscribe button below for more changing
content before we get into the five proven
methods of becoming a money magnet i want you to ask yourself if i were to
become a person who money was magically attracted to what would i do with this
newfound wealth would you buy a fancy new car would you buy a whole new
wardrobe the five methods i am about to share with you are guaranteed to make
you wealthier than you've ever been before but before i do you need to
understand that money only contributes to your happiness when spent correctly
now i'm not going to sit here and try and convince you that money doesn't buy
happiness because quite frankly i believe it does but only when it's spent
correctly before i get into how you can exchange money for happiness let's talk
about instances where spending doesn't make you any happier many times people
buy stuff because they think subconsciously perhaps that will bring
them happiness they just have to have the latest phone or outfit and yes
spending money is fun and makes us happy but for how long
more often than not the novelty of the new item you purchase wears off in a day
or two and you are right back to where you started so then you have to buy more
to achieve that spending high and the cycle continues this cycle is what keeps
the majority of people broke and getting caught in this behavior doesn't bring
true happiness to their life so instead spend your money on things that will
give you longer lasting happiness for instance buy your parents their dream
car then every time you see them driving it you will be happy that you were able
to help them realize a lifelong dream of theirs alternatively spend money on
traveling seeing different parts of the world will make you appreciate what you
have and will create memories that you can cherish for a lifetime now that you
know how to spend your money to achieve immense happiness the real question is
will you ever have the money to do any of that in my opinion the answer depends
on a few factors i believe that just about anyone can become a money magnet
all they have to do is employ the following five proven methods that i
will now go over method number one positioning yourself for financial
success the people that become the wealthiest in the world are those who
know themselves well this means that they know their own strengths and
especially their weaknesses and ensure that both of these elements are managed
to ensure their wealth is maximized unfortunately the number of people who
know themselves well is very small this is because not a lot of people take the
time to self-reflect and those who do tend to shy away from focusing on
aspects of themselves that are not as strong as they would like for instance
many people complain that their employers don't pay them enough but they
aren't willing to reflect on why their current skill set isn't worth more money
the rich on the other hand don't get in their own way which is why they lean on
their strengths and manage their weaknesses for instance not everyone who
makes a large income is good at saving it however for those who have a tendency
of spending more than they should setting up systems to ensure they're
saving success is a great way to mitigate this problem one way to do this
is through automated deductions in essence what these deductions allow you
to do is send part of your paycheck directly into a savings account instead
of the full amount going right into a checking account where you would be more
tempted to spend it allocating 10 of your after-tax income to your savings
account is a great first step in automating your savings efforts and if
you want to ramp up how fast you save money then ask your boss to deduct 20
30 or whatever percentage works best for
you and the self-awareness doesn't just relate to saving money it's important to
learn how you'll react to certain situations without that knowledge you
can set up measures to ensure you don't fail financially for instance how would
you react if your investments fell by 50 would you have the confidence in your
investing knowledge to let them ride out the poor economic times or would you
pull out whatever money was left knowing the answer to these questions is crucial
to long-term financial success a third way to position yourself for financial
success is to place value on taking action this one is pretty simple no
success has ever been achieved without action therefore knowing how to get
yourself to take the necessary actions to achieve your goals is vitally
important one way to create positive action in your life is to set up
positive habits in the book the power of habit written by charles duhigg he
explains that in order for a habit to be successfully employed there must be a
cue a routine and a reward and by setting up all three of these elements
into your financial habits you will be sure to see money coming your way method
number two be a non-stop learner the second method in becoming a money magnet
is to strive to learn more every single day now this doesn't mean you need to
sign up for a new degree or attend a whole bunch of college classes over the
last decade the avenues for education have expanded so greatly that there are
methods of learning that can appeal to just about anyone for instance if
sitting in a lecture isn't for you you can watch an engaging video on youtube
instead or if you find reading puts you to sleep you can plug into the audiobook
version of the text instead sadly many broke individuals stop learning once
their formal education ends they act as if they have already acquired all the
information they need in life to succeed yet this is far from the truth we see it
all the time rich individuals spending more time and money than some people
make in a lifetime on their own personal growth take the example of dan lok this
canadian entrepreneur and multi-millionaire invests more than 500
thousand dollars a year into his education in the form of courses
coaching and many other learning opportunities even warren buffett the
oracle of omaha himself used to read anywhere from 600 to a thousand pages a
day after already hitting the millionaire status and today at a net
worth of almost 90 billion dollars he still spends 80 percent of his day
reading and strategizing therefore if you want to become a money magnet then
you need to have an insatiable thirst for knowledge
method number three you prioritize saving the third way to become a money
magnet is to operate with a high savings rate like i said earlier in this video
you can make as much as you want but if you save none of it then you will never
be rich now establishing a high savings rate can
be achieved in numerous ways but let me share with you a few of my favorites
first you can create a zero based budget to eliminate financial waste when making
this type of budget you start from scratch and have to justify every single
line item of your financial plan which helps you avoid rolling over expenses
month to month that you don't need to be spending money on alternatively you can
resort to only spending cash you see whether you're buying groceries or a new
phone spending cash makes us notice the monetary effects of our actions this is
because as we are paying we are physically handing over money and we see
the depletion in our wallet whereas when you use a credit card or debit card the
potential to spend seems almost endless part of this pain we feel when we spend
cash is due to what researchers call coupling when someone buys an item with
cash they immediately know how much that item will cost which is why when
shoppers pay in cash they tend to spend only half of what they would have if
they would have paid on credit instead method number four making your money
work for you poor people work for their money but the rich get their money to
work for them this is typically achieved through learning the difference between
assets and liabilities if you're unfamiliar with assets they are commonly
defined as a resource that will generate future economic benefits and these
benefits are most often realized in the form of income because assets produce
income the rich buy as many assets as possible which they then use to pay for
their day-to-day lives this method of producing income is highly supported by
rich dad poor dad author robert kiyosaki who recently tweeted live it up buy
everything you want one caveat buy the assets to pay for them first now if
you're currently carrying liabilities then you should be asking yourself how
can i turn these financial burdens into assets take the example of your house
houses are liabilities because they are expense and current possessions each
month you pay for your house's mortgage utilities and taxes but luckily this
liability can also be used as an asset for instance if you have an extra room
in your house you can rent it out to offset some of these monthly operating
costs charging 500 for a room can easily cover some of your monthly utility bills
or part of your mortgage payment ultimately turning this liability into
an income generating tool method number five you spend consciously the fifth and
final way to become a money magnet is to have a low burn rate your burn rate
refers to the amount of money you spend on a monthly basis compared to your
earnings now unless you live expense free you will always maintain some
degree of a burn rate but those who build the most amount of wealth also
tend to be the best at managing their burn rate to break down a burn rate in
more detail this financial ratio is typically comprised of both core and
discretionary expenses core expenses include things like rent
utilities and taxes essentially expenses you can't avoid discretionary expenses
are things like entertainment clothing and other material goods and your
ability to limit these expenses is the key to becoming wealthy when it comes to
burn rate there are three types of individuals there are those who make no
effort to reduce either type of expense those who limit their discretionary
expenses and finally the burn rate minimizers who work hard to limit both
core and discretionary costs as you probably guessed the third group are the
ones who reach financial independence the fastest and i will now walk you
through an example to illustrate exactly how this would work meet steve steve
makes five thousand dollars a month after tax and his monthly housing costs
and day-to-day expenses amount to roughly thirty five hundred dollars
on average steve spends another thousand dollars on closing entertainment every
month combining these core and discretionary costs steve spends forty
five hundred dollars of his total five thousand dollar earnings every month
which equates to having a ninety percent burn rate this leaves steve with just
five hundred dollars a month to put aside for retirement based on the four
percent retirement rule which requires you to have 25 times your annual living
expenses in order to retire with a four percent withdrawal rate steve would need
to accumulate one million three hundred and fifty thousand dollars to cover his
annual living cost of fifty four thousand dollars which if he invested
five hundred dollars a month that ten percent would take 32 years but what if
steve were to reduce his annual living expenses how would this affect his
retirement timeline let's say steve downsized his home and cut out 75 of his
discretionary expenses making his total monthly burn rate three thousand dollars
he would then have a burn rate of sixty percent and an annual living cost of
thirty six thousand dollars this annual cost would mean having to save up 900
000 which at 10 would take 28 years in
essence by reducing your burn rate you are effectively shortening your path to
financial freedom and turning yourself into a legit money-making magnet hey it
looks like youtube thinks this next video is the one that will change your
financial life forever give it a watch and let's see if they're right