December 11, 2009
IS YOUR FINANCIAL PLAN A BUCKET WITH HOLES?
So imagine you want to build up some wealth over you lifetime (I think most of us do). The bucket represents your plan to achieve that goal. The water represents your pool of money. And the holes in the bucket represent the money that is flowing into your pool and then right back out either unknowingly or unnecessarily. The main culprits causing holes in your plan are
- opportunity cost
Here is a startling fact: The average American spends around 30 cents of every dollar earned on interest alone.
To fill your bucket you can choose from one of two options:
- Add water to it at a faster rate than it is flowing out the holes AKA seek out risky investments with the hope of cashing in on a high rate of return.
- Simply plug the holes and watch your bucket overflow.
Instead of frantically chasing high yield investments that put your money at high risk work on controlling the controllable!
When you implement the banking concept and become your own bank you put yourself in control of your financial future. Instead of paying 30 cents of every dollar to someone else, pay it to yourself and watch as you actually make money doing something you would have done anyway…making purchases. Instead of paying cash for major purchases, and losing the opportunity for that cash to grow, finance them through YOUR bank and keep your money working for you forever! These are only a couple of examples of the infinite possibilities behind becoming your own bank.
So…how do you want to fill your bucket?