(Adapted from George Clason’s ‘Richest Man in Babylon’)
Many people think that entrepreneurial ventures are all about money, but really, money comes in just as a reward for the effort put into coming up with a good income generating system.
So how do you manage this income after it has been generated:
The first tip that’s recommended is saving and in this particular book, it’s set at 10% of your income.
This may seem like a very insignificant amount of money to set aside every month or week, especially if your income is low, but the aim of savings is to invest them for the long-term and thus should take time to build up.
When it comes to finances, consistency is key and building up a good habit pays off in the long run. The amount is not limited to just a tenth of what you earn, you can adjust it as need be or as per your goals, but one thing that is for sure, this money needs to be set aside before any spending is done.
2. BUDGET FOR EXPENDITURE
To start you off, you can download any of the simple budgeting tools available on play store and try and come up with a budget for the next two or so weeks.
Even if you won’t follow it to the letter, when you review it after those two weeks, you’ll get some great insights on what you can improve on in the long run.
3. MAKE THY GOLD MULTIPLY
Your gold in this sense is your savings and they need to earn you a silver which is interest.
Your savings should be invested somewhere that they can labor for you and make you passive income without you having to actively pursue those investment ventures.
Basically, this is the whole concept of passive income. The long-term target is to make passive income greater than active income so that you can solely live off your passive income and use the active income for more investments.
4. GUARD THY GOLD
Your savings were hard earned so let that sink in, remember how you toiled for them. When it comes to investing you, therefore, need to do a lot of research and consulting before you can put your gold anywhere. If you don’t have a place to invest, best keep stacking the amount until you can come up with an idea.
5. INCREASE YOUR ABILITY TO EARN
Once you have the above tips all going for you, it’s time to increase your earning potential. If it means adding your stock or opening a new business after careful evaluation of market demands or even if it means increasing your skill set to earn higher, it’s time to do it. Build up a work ethic that will see you increase your income on a constant basis, so you can save more, budget better, invest more and live better eventually.
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