The concept of wealth and financial freedom

May 14th, 2011

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The concept of wealth and financial freedom
You know what it means to be financially free and abundant? Contrary to popular belief, wealth is not the amount of income you can produce. A person with an income of $ 100 000 can not be less wealthy than someone with an income of $ 10 000. Let me share with you this very broad definition of Mr. Adam Khoo secrets used self-made millionaire.

The concept of wealth
Wealth is

It is the amount of money you earn
Not as many luxuries that seem to have
Not only on your net worth

Wealth is the number of months or years can support your desired lifestyle if you stop working now.

As a result, his fortune is determined by …

1) your monthly expenses, lifestyle
2) your cash
3) passive monthly income

Wealth is measured in terms of how long you have to do what you really want …

Example 1
Steve earns $ 10 000 per month as director of the primary account. Their monthly expenses are $ 8,000. It’s less than $ 16,000 in savings. He did not become cash flow positive. If Steve does not work or lose your job, your current savings the past two months. His wealth is two months.

Example 2
Anna earns $ 3500 per month as marketing manager. Their monthly expenses are $ 2,500 per month. In the past 20 years has accumulated more than $ 380,000 of cash positive assets, stocks, bonds, term deposits. In total, generated an average return of 8% per year or $ 30,400. If you follow a lifestyle of $ 2500 per month, you could stop working today and maintain their lifestyle indefinitely. Even without the cash flow from wages, investments of $ 30 400 more than cover the monthly expenses of $ 2.500. His wealth is infinite. He came to financial freedom.

Step by step to freedom and abundance

In Secrets of Self Made Millionaire, Adam Khoo, then we have learned to identify the four levels of wealth. In this part of his program, which specific step, by step instructions on how to shoot when you are and how to design a schedule and timetable for achieving each level of wealth and, ultimately, achieve financial freedom followed by abundance. He then presented stragteies to achieve the schedules by teaching you how to greatly increase your income in the form of CD 4 and 5. Here we will share with you a definition that is compressed enough so you can determine where you are and where you want to go. Let’s go through the “how come” in the following chapters.

Step 1: Financial Stability

Source of the secrets of Self Made Millionaire

This is the most basic level of wealth you need to achieve.

You have reached financial stability, when:

1. That have accumulated enough liquid assets, cash and short-term FD to cover your expenses for at least 3 months.

2. In addition, surgical and hospital bought a H & S and life insurance with severe and permanent total disability and to protect you and your family if you are permanently disabled, unable to work or who die suddenly.

Once you have achieved financial stability, you have the assurance that if any unexpected challenges befall you, such as downsizing, business failure, lost wages, death, disability, life, you and your family are not compromised. You or your family have time to seek new sources of income to get back on track.

You also have the financial stability to quit your job and invest your time to build a business if necessary.

Financial Security

You have reached financial security when you have through the investment of time, money and ideas, accumulated a significant amount of assets that generate positive cash enough passive income to cover their most basic expenses.

Basic living expenses should not only include the following:

1. Mortgage and related expenses such as utilities and costs of protection.

2. Public transport fares.

3. Food for you and your family, household purchases

4. All taxes and interest payments on debt.

5. All premiums for life insurance, disability and home.

Upon reaching the level of financial security, to be able to:

1. Stop working and still be able to maintain a simple lifestyle and basic.

2. Canal almost 100% of their income to increase positive cash assets

Active flow, all the basic expenses that are covered by their current income liabilities or luxury purchase.

Financial Freedom

You have reached financial freedom when you are through the investment of time, money and ideas, accumulated a significant amount of assets that generate positive cash enough passive income to maintain your current lifestyle.

Upon reaching the level of financial freedom, you will be able to:

1. Stop working and keep your current lifestyle indefinitely.

2. Manage 100% of your earned income if they are still working) to charity, buying luxury assets and increase cash flow positive.

3. Be free from financial pressures and concerns.

Financial Abundance

You have reached the financial wealth when you have through the investment of time, money and ideas, accumulated a critical amount of positive cash flow

Assets that generate enough passive income to maintain your desired lifestyle.

At the level of financial abundance, to be able to:

1. Stop working and living the life you really want.

2. Manage 100% of their income if they still work for the charity, buying luxury and a dream even more active.

3. Be completely free of financial pressure.

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As an inspiring mentor, Daniel went to help people around the world to achieve their goals and dreams. To achieve what they really want and financial freedom