This week our tip is provided by Charlie Machinski.

Two people come into the program (we’ll call them Joe and Tom). Both are extremely excited to be a huge success and change their financial lives forever. Joe is very strict with himself; he stops traveling and stops eating out. Joe was going golfing with his friends but he cut that back as well, he cut back on everything. The first month that he was in the program it was hard but he was determined to make it work. He stuck with it and made it to the second month. Joe started to make comments to his wife like he felt like the program was too restrictive. It was only a matter of time before Joe decided that he did not want to live that way. Not only did he go back to his old ways but he was worse off then when he had started down the path to financial freedom.
Tom on the other hand understood that you need to allow for balance if you want to have a chance of sticking with the program over the long term. He did not cut eating out completely out of the budget but he cut it down to once a week instead of everyday. He also found a balance to have fun, and to do a little traveling while he was on his way towards his financial. With each debt that he paid off he would go do something fun to celebrate his victory over his finances.
Unlike Joe, Tom found a balance in his financial life. He did not feel restricted he had fun with the program and made sure that he celebrated his victories. Find a balance that works for you and your finances and make sure that you are not feeling restricted. By doing this you set yourself up for long term success.

This week Lorin shares another great success story.

The world is getting happier as a result of more personal freedoms being offered and enjoyed by people across the globe who 20 years ago felt entrapped by their governments. The expansion of political and social freedom in the world today results in a greater sense of personal happiness for the masses that has been bought by the courage of individuals and nations through sacrifice, perseverance, negotiation, and in some cases bloodshed. Yet happiness is a choice no matter what our surroundings and circumstances.

The millionaire mindset is characterized by overcoming adversity and keeping optimistic in the face of hardship. Opportunities for personal growth come from overcoming obstacles strewn along our paths. It takes courage to continue working through difficulties and in seeking the way through personal struggles. Our greatest gift is our ability to choose our pathway in life and to wake up a view each day as an opportunity to make a difference-the end result being financial freedom (where work is optional and recreation is affordable) and thereby giving us the ability to take our talents, skills, and knowledge to lift others up and to help them through the obstacles that we have previously overcome.

True happiness comes from within, but can be defined in various ways. Many feel joy with money, but realize that money is only a tool that makes the bumps along the road somewhat smoother. It’s not what we have, but what we do with it that matters anyway, so it can be argued that money provides the ability to help others enjoy a smoother path as well. And isn’t this the very definition of personal and financial freedom? Many of the keys to developing this belief lie in changing our mindsets. Books are written on the topic, but it always boils down to having a core set of beliefs that are realized in the everyday actions of the believer. There are specific secrets behind wealthy, successful men and women. In essence, the millionaire mindset acknowledges the following factors:

1. It’s good to fail. Failure is a powerful motivator to keep going until you succeed.
2. Be stubborn! It’s your life and if you try to live it according to others’ wishes or always trying to impress and please people, you would probably end up nowhere.
3. There is always a way. The only way out is through whatever hardship your facing. If there’s a problem, there’s bound to be a solution.
4. Tomorrow never comes. Masterminds know tomorrow doesn’t exist. Anything that can be done, should be done right now.
5. What’s your excuse? You already have all the skills to do something great. you just need to believe in yourself and put forth some effort.
6. Smartness: Work smarter, not harder– smartness is about how to solve complex problems easily.

The courageous don’t live forever, but the timid don’t live at all.

People overcome extraordinary circumstances every day. Courage is doing the things that you know you should but are afraid to do. Courage is not only the opposite of despair, it is also acting in spite of despair. Courage is the key to freedom, whether it be personal or financial. There are six main keys and practical ways to develop courage:
1. Get to know your strengths instead of looking at weaknesses; look for he things that you are already good at and work on developing your strengths.
2. Allow yourself to think affirmatively. There’s great power in the concept of visualization.
3. Start with simple tasks and work your way to bigger and better. When it comes to your finances, it’s much easier to focus on the little aspects that you hope to change or the smaller debts that you wish to pay off.
4. Look at the possibilities instead of dwelling on the vulnerabilities. Problems are only obstacles until someone discovers how to solve them. Become a possibility thinker and be positive in your approach to anything, and you’ll find that you can accomplish anything.
5. Be persistent. “If at first, you don’t success, try, try again.” Successful people got up each time they fell and always learned from their mistakes.
6. Find a source of faith to believe in and to call upon. Isaiah 40:29 says, “He giveth power to the faint, and to them that have no might he increaseth strength.”

Lastly, when overcoming fear, pay attention to the acronym:
F: FOCUS on your vision & what you really want. Clarify the desired result.
E: EXPLORE–notice the warning signs & your resistance & use it as a reminder to stop.
A: ASSESS–Look at your options and create an action plan; break your action into small steps.
R: Respond positively and take action; expect the best.

We all have patterns when it comes to thinking and doing… pretty much in every area of our lives. We have been blessed with incredible freedom, which include the ability to succeed and to fail and to learn from our mistakes. You can choose to overcome any obstacle and hardship and turn negatives to positives. You can have the future you desire by visualizing it, then creating an action plan to achieve it. Don’t let your fear stop you from living the American Dream, and remember, courage is the key to freedom.

Regards,

Kory

THE EIGHT GREAT MISTAKES THAT INVESTORS MAKE

1. Over Diversifying - Yes, you do want to diversity so your “eggs aren’t all in one basket.” But you do not want to spread your money so wide that it is difficult to monitor

2. Under Diversifying - Just the opposite, if you put all of your money in three funds, and one does poorly, the other two will not have enough spectacular returns to make up for the difference

3. Euphoria- Some investors have their head up in the clouds much of the time and think nothing can go wrong. They may need a dose of Murphy’s medicine. If something can go wrong it will!

4. Panic- Many investors are in this mode right now. All you have to do is take a look at your 401K statement and it can set you to panic mode. You must ignore that negative return and look at the big picture. Dollar Cost Averaging in equities always will win in the long run. Just keep putting in your $50 or $100 or whatever you can afford each month regardless of the price, and over the long run your average investing will win. If you panic and pull your money out at the worst time, you may indeed have a real loss, not a paper one. A heart attack may not be far behind.

5. Speculation - Many investors want to build new streams of income but they may jump at very risky online advertisements. Ecommerce can be a good opportunity to build future income, but you must carefully research the background to see if it’s worth even considering. Most online ads are not worth your time

6. Investing for Yield (dividends) instead of total long term return - In the short run yield returns will be moderate, taken over a long term horizon with a carefully planned strategy will bring about the result you are seeking

7. Letting the cost basis dictate your investment decisions - the cost basis is typically the upfront money you put into an investment. It is on the back end where appreciation is realized, and that takes time and prudent watchcare

8. Leverage-this is a huge word and can be your friend. We are all familiar with the example of investing $10,000 to buy an investment property worth $100,000. You might clear $500/mo from the rent it produces, after paying all of your expenses. That would be $6,000/yr which is a 6% return. As that investment appreciates you will realize a potential large profit. If you use leverage you would pay $10,000 to buy the same $100,000 building. Your annual rent profit may only be $100 per month. But that $1,200 annual rent profit represents a 12% return on your smaller $10,000 investment, twice as much! Then suppose you sell the property a yr. later for $110,000. That $10,000 increase represents a 100% return on your investment. You double your money in a year! Now suppose you invest $10,000 in 10 properties that are worth $100,000 each. Now you control $1,000,000 worth of Real Estate Investment and as it appreciates it can build you wealth in a hurry. However leverage can be a two edged sword if the property significantly drops in value, and increases your leverage losses. The point of course is to find the right balance and use leverage in a smart way!

This week's tip is on how to avoid the stress that comes with difficult economic times.

For many people finding their motivation is a hard thing to do. It may be hard at first, but once you have found what makes you tic you can use this as a catalyst to move you towards your goals. As I stated last week there are two major motivators according to JJ Childers, pleasure and pain. For most people these two motivators are what motivate them to action. Taking action is one of the keys to your financial success. With action comes courage and hope, and without action we have fear and despair. Once you have found what motivates you to take action, make sure that you keep the motivation alive by reminding yourself of why you are doing what you do.
I am motivated more by pleasure than pain. When I set a financial goal and I achieve them it motivates me to continue executing the plan that I have put in place. It can be easy to forget the success that you have each and every day and thereby loose your motivation. That is why I recommend keeping a success journal. By finding what motivates you, you are able to take action. By taking action you take control of your financial future. It all starts with the spark of motivation. Take some time to think about why you do what you do and think about the things that you can do to increase the motivational factors in you life.