Cash Flow (Literally)

Another week, another post - this one is just a commentary on something that Karl Fulljames found on another blog on the Internet.

In relation to Cash Flow, the Blog called: The Tao of Making Money illustrates the cash flow patterns that exist for the vast majority.

Although an excellent example - I feel that it doesn't capture every aspect of the rich cash flow archetype - but that's pretty well documented in Kiyosaki's and Anderson's work.

In any case, it's a good start. If only there were a multiple income stream one where they had some of the money flowing into an "Asset" container, which then streamed back into income...


sometimes I wonder if it's a good thing, or a bad thing that I own a tablet PC... Anyway, you get the rudimentary idea. Eventually the goal would be to create multiple passive streams and get rid of the IN stream coming from the regular 9-5 workday to free up more time to dream up even more passive streams. In the end, it truly is just a game.


Thanks to the whole iPoint project, I'm happy to say that this is my current diagram - (with a few more asset/passive lines - but I'm not creative enough to figure out how to draw that many more). Now that I've done even further research and started looking into the real estate side of the market, I'm looking forward to adding even more streams. I can't wait until I'm allowed to launch the whole Infiniti Point Investment Club.

Cheers,
Earl

Jobs cause the most stress

Here's a damn good reason for me creating iPoint:

Stress = BAD

Job = Stress

Therefore

Job = BAD

Take a look at THIS article from the Vancouver Sun. Although I should really write up the whole story from the beginning, Infiniti Point to me was a method to help my friends and family members (at least the ones that were ready) learn and join me in the quest for passive income and financial freedom. Even though I feel that I've already met and surpassed my original personal goals, it's no fun sitting on the beach by myself...

I'll have to add that my stress levels - even at a job that I enjoyed at one point were still up there. Being stuck - not having the choice to WANT to work and not HAVE to work is still a stressing point unto itself.

Having said that, please join me in my quest for chasing perfection and true freedom. Check out http://www.ipoint.ca/ and join the forums, help us to find opportunities, and join the ones that we're already participating in and escape the 9-5 prison that gives Canadians so much stress as of late. My next personal goal will be to help 15 people reach either 1M in net worth, or 500k/year in passive income by 2010. Afterwards, the goal will be to help 100 people reach the same goals by 2012 and lastly 1000 people by 2014.

So you lost your wallet (or purse)...

Now what? Your keys, credit cards, points cards, coupons, stamp cards, chewing gum, recent receipts and perhaps a few photographs are now pretty much gone... To boot, you've now got to deal with the headache of finding those darn phone numbers to let each of your financial institutions know about your predicament.

For those of you that know me, you understand the fact that I've got the memory of a goldfish at times, and delight in the 11th "discovery" of a castle in my fishbowl as I try to re-arrange my filing and room those 3 times a year when I feel super inspired.

One of the steps that I do in between my rousing games of "find my keys and wallet or I don't get to leave the house" is that I scan/photocopy everything in my wallet. Naturally this should happen AFTER emptying it out a little to compete a little bit less with George Costanza Oh, and don't forget to do BOTH sides of the cards.

Jerry: Your back hurts because of your wallet. It's huge.
George Costanza: This isn't just my wallet. It's an organizer, a memory and an old friend.
Jerry: Well, your friend is morbidly obese.
George Costanza: Well, at least I don't carry a purse.
Jerry: It's not a purse, it's European.

No, I'm not going to post a picture of the inside of my wallet here (I'm not that much of a goldfish) but it's a great start to finding all of those much needed phone numbers on the backs of all of your credit and debit cards. (did I mention to scan/copy the backs too?) Plus that usually hides the location of those accursed security numbers that they keep asking for to prevent people from stealing your credit card and using it without finding their secret backside hiding place.

Now I might also mention that it's a good idea to write "Please ask for Photo ID" on the back of your cards as well, so that the person who "found" your money carrying device can't accidentally purchase something by mistake :).

On that note, you might as well order something in for delivery at this point because it'll be fun calling all of your auto-billing memberships, bills, subscriptions, etc to stop payments on things, and then again once you get your new credit card numbers. Better hope you're carrying some cash!

Lastly - if your wallet didn't have anything in it to begin with, perhaps it might be prudent to call up some of those folks over at iPoint to find out what they're up to these days.

Taxes Simply Put (Classic Story)

Ok, I know that this is an old story - but it never ceases to amaze me the number of people who A) Haven't seen this one before, and B) Don't understand this concept.

I'm starting to wonder if the stuff I heard at the last Fast Track to Cash Flow event in Vancouver talking about moving to Alberta because of their great tax structure (comparitively speaking with the rest of Canada) might be a good idea or not...

Anyway, here's the story:

Lets put tax cuts in terms everyone can understand. Suppose that every day, ten people go out for dinner. The bill for all ten comes to $100. If they paid their bill the way we pay our taxes, it would go something like this:
The first four (the poorest) would pay nothing.
The fifth would pay $1.
The sixth would pay $3.
The seventh $7.
The eighth $12.
The ninth $18.
The tenth (the richest) would pay $59.
So, thats what they decided to do.

They ate dinner in the restaurant every day and seemed quite happy with the arrangement, until one day, the owner threw them a problem. "Since you are all such good customers," the owner said, "I'm going to reduce the cost of your daily meal by $20."

So, now dinner for the ten only cost $80. The group still wanted to pay their bill the way we pay our taxes. So, the first four were unaffected, they would still eat for free.

What about the other six, the paying customers? How could they divvy up the $20 windfall so that everyone would get their fair share?

The six paying customers realised that $20 divided by six is $3.33. If they subtracted that from everybody's share, then the fifth and the sixth would each end up being 'PAID' to eat their meal.

So, the restaurant owner suggested that it would be fair to reduce each persons bill by roughly the same amount, and proceeded to work out the amounts each should pay. And so:


The fifth, like the first four, now paid nothing (100% savings).
The sixth now paid $2 instead of $3 (33% savings).
The seventh now paid $5 instead of $7 (28% savings).
The eighth now paid $9 instead of $12 (25% savings).
The ninth now paid $14 instead of $18 (22% savings).
The tenth now paid $49 instead of $59 (16% savings).

Each of the six was better off than before. The first four continued to eat for free. Once outside the restaurant, they began to compare their savings.

"I only got a dollar out of the $20," declared the sixth, pointing to the tenth diner "but they got $10!"

"Yeah, that's right," exclaimed the fifth. "I only saved a dollar, too. Its unfair that they got ten times more than me!"

"That's true!!" shouted the seventh. "Why should they get $10 back when I got only $2? The wealthy get all the breaks!"

"Wait a minute," yelled the first four in unison. "We didn't get anything at all. The system exploits the poor!"

The nine surrounded and beat up the tenth diner.

The next night the tenth diner didn't show up for dinner, so the nine sat down and ate without number ten. When it came time to pay the bill, they discovered something important. They didn't have enough money between all of them for even half of the bill!

That, boys and girls, journalists and college professors, is how our tax system works. The people who pay the highest taxes get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy, and they just may not show up at the table any more.

If you're interested in finding out ways to save those hard earned dollars before the tax man cometh, why not contact a few of the folks at Infiniti Point

Cheers,
Earl

Who's your Dollar?

Loonie could swoon next year, EDC says

Apparently the Canadian Dollar might not be so mighty in the long run in 2008 according to this article from The Globe and Mail .


I'm a mixed bag of feelings at this point because I've got investments on both sides of the fence. But being a proud Canadian, I'll be happy to revel in the sunshine that is a strong Loonie for the time being.






What with the tax rates dropping shortly as well, it's good news for everyone in Canada Land. So here's to the mighty maple leaf in the short term. Why not take a vacation and enjoy the role reversal on the American side for a bit?

Worst Credit Card Ever!

Ok, there's bad, there's bad, and then there's the Worst Credit Card in the history of mankind.

Let me get this straight... they charge you:

$99 Set up Fee
$49 Annual Fee
$89 Program Participation Fee
$120 Account Maintenance Fee
_____

$357

357??? for a card that starts at $300. Oh, and it also charges 20% interest. Wow... just wow... No wonder the Rich get Richer and the Poor get Angry. What "grinds my gears" is that they also charge $25 to up the credit limit $100 at a time at their discretion without requiring customer permission! I think you'd be much better off with a cash secured credit card than this monstrosity...

Some words of wisdom that I learned from Frank Abagnale a world renowned expert on Identity Theft were thoughts on credit.

1. Never use Debit Cards. They contain the information used to get into your bank account, and if stolen alongside your PIN - any losses that you take due to theft are placed in your own liability.
2. Use Credit Cards and simply pay them off before interest is charged. With the insurance of credit card companies - just calling into them alerting them of the stolen card allows you to stop the withdrawals and purchases, alongside limited liability to the client for the stolen monies.
3. When your children go to post secondary, instead of giving them cash - create supplementary cards in their names with credit limits. This allows you to monitor their spending habits, while at the same time building their credit history.

I hope that people get educated enough to realize that they could potentially be ripped off if they don't add up the fees that are stacking up... I'm also very much looking forward to Patrick Evangelista's future research notes on a GOOD Canadian credit card - and a breakdown of the points systems (airmiles, aeroplan, 1% cashback, etc)

Until next time.

Cheers,

Earl

Leadership Mastery - Day 2

On to Part 2 of the Leadership Mastery by the power within.

The second day was a definite eye opener for me. We started off with Ram Charan who started his speech in a much different manner than the rest of the previous speakers. Instead of being up on stage, he walked around the floor engaging people directly and involving the crowd more deeply in his words.

Practice leads to Instinct grows to Intuition which evolves into Judgement.
it's only through the practice and desired determined repetition that people are able to reach further with their skills.

The rules he set out were:
1) Deliberate Practice. (Are you practicing something new every week?)

Without learning something new at each opportunity, your obsolescence grows. You need ferocious determination to commit to new practices because if you're not growing, your competition is.

2) Look over the Horizon (what's coming in the future?)

What's changing? Develop the ability to detect change. Also cultivate your creating change abilities to influence your teams.

2a) Identify changes in the external environment

Be a creator of change instead of a recipient.

3) Broaden yourself

Each and every day you must strive to be more than the person that exists now.

4) Use the Multiplier effect

"I don't do it, I get it done, with my multiplier"

Working in methods to leverage yourself and train the trainers allows your influence to increase in exponential leaps and bounds.

5) Keep an eye for Talent

With the current shortage of talent in the world - a keen eye for people that would make a fit, or growing organically (finding talent within your organization) will keep you ahead of the competition.

6) Calibrate People

This topic was touched briefly and basically stated to ensure that people are working at a good pace to the benefit of the business in one of the categories of margin or velocity - Ram continued into the next point to deeper explain the theory.

7) Mastery of your business

Exercise: How do the successful companies accomplish measurable goals? Identify 10+ companies that make good money over a long period of time? How do they make money?

Some of the highlights from this chat were:
- Microsoft (96% gross margin on product)
- Johnson and Johnson (11% sustained growth for 50 years)

Understanding of the 4 parts in a business that make all of the difference.

• Margin
• Velocity
• Revenue Growth
• Cash

Return = Margin x Velocity

Each staff meeting to really make a difference in the business would be to list different methods on how to increase the Margin if possible, develop a more efficient/faster Velocity to increase the revenues.

Ram gave the example of how Dell with already thin margins was forced to look towards increasing the velocity of the business. He then continued to show us a chart of the inventory turnover rate of Dell over the years and then explained that Dell's current inventory turn is somewhere around 120 in comparison to their closest competitor sitting around 25.

8) Understanding of the 80/20 rule

80 percent of the benefits will come from 20 percent of the changes. Once you identify said changes, select 3-5 of them to focus on as laser sharp dominant priorities.

9) Having the right people in the right jobs
10) Follow through

Ram's speech was of excellent value to me personally during this weekend because I had a lightbulb turn on at this point for my own business - and came up with an idea to increase revenues by 10% with just a little rearrangement in business structure.

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The second speaker of the day Dan Gilbert spoke about his theories on Stumbling on Happiness

After showering us with many different views on how to calculate happines ranging from: Happiness = Your Salary / Your Neighbour's Salary to comparing one scenario vs. another. Other tidbits of info included that 10% of your income provides 90% of your happiness.

If you're intersted in checking out more of Dan Gilbert - I managed to find a video on the internet.

One of the comments that struck a chord with some of the crowd was the comparison on levels of happiness before and after children within a marriage. Basically he stated that with children and the time commitments required the different types of happiness that could be experienced were reduced, and thus wouldn't return back to normal until the kids moved out. I myself can't truly comment on this yet as I've yet to start a family. Needless to say the parents in the crowed weren't too amused.

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The next speaker up was Frank Abagnale the author and protagonist of Catch Me If You Can with an inspiring speech about his history and life. At first, it seemed less lively and took many of us off guard with the delivery, but the content grabbed our attention, and before we knew it - many of us were swept away in the rythm of his words.

Many of the people that have heard the story via the movie - myself included were in awe of the social prowess of Abagnale during his youth, however from his point of view it was simply a matter of survival as a child thrust into the world of adults. His strong stance on family values and ethics was an inspiration to us all.

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Unfortunately due to some logistics and travel issues, Peter Guber wasn't able to present.

Luckily for us however the keynote speaker Anthony Robbins was able to jump onto a helicopter and appear earlier for us.

Something of interest I noticed was that fans were put onto the stage before Tony walked on. Little did I know I'd be wishing for some fans too after all of the excitement.

Let's get down to the notes I took:

3 Mandates of Leadership

1. See it as it is, not worse than it is
2. See it better than it is
3. Make it the way you see it

The most fundamental job of a leader is to influence.

Now to set the record straight - Tony is NOT a "motivational speaker". Where people get that idea from is all of the commercials with all of the jumping and screaming - but there is a method to the madness.

Focus

v

State -> Behaviour / Action --> Results

^

Physiology

To reach the results you desire, you must change the behaviours or actions of a person. However before you can inspire change in behaviours or actions, you must alter someone's state. The only two routes to state are via physiology or where the mind is focused.

I suppose since his claim to fame wasn't hypnosis, we went the physiological route to change the state. Although it seemed silly at first, the drills on applying different types of physiology to similar actions indicated a change in state, and in the end, a change in the result of our actions.

I think that people could hear us cheering from across Whistler village as we got pumped up for the last few "state changes".

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All in all the weekend was a most enjoyable experience. The company at hand always had something interesting to speak about - the speakers were of the highest calibre - and best of all it didn't feel like I was attending an event where I was there only to realize it was a giant marketing ploy aimed at selling me the "next level seminar". It was this level of professionalism that makes me look forward to the next year's lineup - and to experience the whole thing anew. Until the next one, live well - live full and I'll hopefully see more of you around again the next time through.

Cheers,

Earl