Scaling

3 Types Of Systems EVERY Business Needs

I’m about to reveal how to overcome the one thing that trips so many business owners up…

I’m talking about scaling.

Scaling just doesn’t mean making more money or growing your client base.

It means growing fast, being more profitable, and doing so without more effort on your behalf.

Because let’s be honest…

You may be growing but it likely comes at the cost of more of your time.

You find that you’re so busy being busy you don’t have time to work ON the business because all your time is spent IN the business.

And if you want to scale you must have a number of things in place.

So let’s quickly talk about what you need in your business to scale.

The Missing Link To Scaling Your Business Fast

You may have heard me say this before.

“If your business isn’t systems dependent, it’s dependent on you.”

And if that’s the case, you’ll never attain the time freedom you desire.

Isn’t that one of the main reasons you got into business in the first place?

Here’s a question to ask yourself…

Are you creating an asset or buying yourself a job?

If you want to scale, this video explains in detail why you need a business model that is replicable and scalable >>

Now, I’m not saying you need to create the next Apple or Amazon and hire thousands of employees…

But, if you’re not growing you’re dying.

You need to grow and expand if you want wealth and freedom. 

Without growth, you’ll continue to be a slave to your business, instead of it being a vehicle that brings you wealth, time, and freedom.

Now you may be wondering, “when is the right time to focus on systems, and what systems will I need in my business?”

Good question.

Every business is different, but in some ways, they’re also very similar.

This video explains exactly when and why you’d want systems in your business >>

3 Types of Systems Every Business Needs

Hard systems, soft systems, and information systems are the 3 types of systems.

This quick video explains the different systems in detail so you know exactly what systems you may need in your business >>

When you choose and install a system, it’s important to bear in mind that a system should solve your problems forever, not just once.

Systems are there to make your and your employees’ lives easier.

If you don’t have solid systems in place when an employee leaves they’ll take their knowledge with them, and you have to train their replacement.

But if you have a system in place, you can get another team member to train them on how to operate the system. 

That’s why systems are so powerful and essential.

They’re there to do the heavy lifting for you, and you need them to scale.

How to Install Systems In your Business

A lot of people complicate systems, but if you’re stuck on how to use them in your business…

I’ve got you covered.

Click here to discover how to save yourself stress, time, effort, and money with systems >>

Systems allow you to work on your business and not in your business.

Which is what every entrepreneur needs if they want to scale.

Because not working IN your business all day gives you valuable time to strategize the best ways forward >>

The video above will teach exactly how to work ON your business rather than IN it.

How To Scale your Business

Once you have the right systems, you’re almost ready to scale.

But in order to scale you must know the 3 important numbers I teach here >>

BOTTOM LINE: If these numbers aren’t favorable, you’re in no position to scale.

You must have high margins to scale because as you grow your cost of fulfillment increases and the less profitable you’ll become. 

You also need high margins so you can outspend your competitors.

Don’t forget, it’s the person who spends the most to acquire a customer that wins market share.

Here’s a real-life example of how and when it’s a good time to scale your business >>

At any given moment in your business, you want to be able to know how healthy your business is.

Alex Hormozi breaks down his favorite way of getting a quick snapshot of your business >>

Using the method he teaches in the video above you’ll gain 4 pieces of very powerful data quickly and easily…

So you can see what needs to change in order for you to hit your business goals, continue to grow, and so much more.

I hope you’ve enjoyed this edition of High Ticket Weekly.

But before you go…

In just a few weeks, we’ll be running our next S.M.A.R.T. Challenge™.

When you join us, you’ll get my best strategies to SCALE, SYSTEMIZE, and SUSTAIN your business for years to come.

It’s a 3-day event attended by hundreds of coaches, consultants, and knowledge experts from all over the world.

I highly recommend you join us if you’re serious about your business and want to take it to the next level and stop trading time for money.

You can get the full scoop on the S.M.A.R.T. Challenge™ here >>

See you there,

Dan Lok

P.S. – No matter how big your business is now, you will benefit from having the right systems in place.

So, if you’re stuck on what to implement, then click here, and let’s work through it together over 3 impactful and life-changing days >>

High Ticket Ascension: A Guide for Beginners

Entrepreneurs and business owners are always looking for strategies to scale their businesses and increase their sales. There are plenty of ideas that work, but not all will be effective. Knowing the right business model is what can take your business over the edge.

High Ticket Ascension is a strategy that you can put into effect that can increase your profits. The ascension pyramid has to do with the customer journey and follows the 80/20 principle. This principle states that 80% of your profits should come from about 20% of your business customers.

This may sound too good to be true, but by following the Ascension Model, you can achieve this. Plenty of industries, businesses, and entrepreneurs follow this model. Here is a guide for business owners, coaches, and consultants to understand High Ticket Ascension and implement it in their own businesses.

First, What is The Ascension Model

Let’s cover the basics: what is high ticket ascension? This is a business model that’s meant to take your clients through a growth journey. In this method, as a business owner, you offer multiple products on five different tiers that should take your customers and clients to the next step of their journey.

The trick is to create products that don’t compete with each other but rather build on the previous tier. It should feel like a step forward in which clients are able to gain more knowledge or experience.

One of the ascension model benefits is that you can work with clients and customers throughout the journey, from when they start at the base of the pyramid to if and when they reach the top. You’re able to find new clients while also maintaining previous client relationships.

Who Can Use This Method?

Any business can use a client ascension method, but it’s a great way to stay competitive in the market. It’s ideal for businesses like coaching or B2B services, or are hobby related, or promote an enhanced self like weight loss.

The Five Tiers

Your ascension pyramid should have five tiers that increase in offerings as well as price. The five tiers, from bottom to top, are entry-level service, basic-tier service, middle-tier service, high-tier service, and top-tier service.

As clients choose to move up the pyramid, they pay more in price but also get a more luxurious or personalized product. Gradually, customers will filter up, paying for the higher tiers, but you’ll also have new customers entering at the lower tiers.

Have a signature program and higher tiers that build off that initial program. In this method, you can offer more in-depth programs at a higher price, such as one on one or small group coaching that can help customers solve issues they may be facing from the initial program, like weight loss or sales conversion.

High Ticket Ascension Can Increase Profits

If there’s a method that works, then why try to change it? As an entrepreneur or business owner, you’re always looking to be more successful, find new clients, and increase your profits. To do this, you need the right strategy.

There is a way you can improve the customer journey and your profits. Plenty of businesses use High Ticket Ascension, so why can’t you? Paired alongside quality product offerings, you’re guaranteed to see growth in your customer base and bottom line.

Ready to take your business to the next level? Take a master class on getting paid for what you know, plus more strategies and tips for becoming the best in your business.

When Should I Hire My First Sales Closer?

Today, you’ll discover when you should hire your first salesperson, how to hire the right salesperson, and common mistakes to avoid.

How To Know Who You Should Hire First

There are a lot of conflicting opinions out there, and it depends on the type of business you run…

But you could hire a marketer, copywriter, accountant, admin clerk, and the list goes on, but…

As you’re a coach, consultant, knowledge expert, or trainer, it’s my belief that you should hire a salesperson first.

We’ll call them closers for the rest of the newsletter.

So why should you hire a closer first?

I recorded a quick podcast episode for you, where I explain this in its entirety.

Click here to find out why and how a closer will help you generate more revenue and get your time back >>

So you know why you should hire a closer as your first employee, your next challenge is to find the RIGHT person.

The Difference Between a Closer and a Salesperson

Before we go further, you may wonder why I call them closers, not salespeople.

Quick question…

What words come to mind when you hear the word salesperson?

Slimy, sleazy, snake oil, pushy, manipulative?

It’s likely you’re thinking of these words or others similar.

A salesperson is a good talker who pushes you into the sale and knows little about you.

A closer is a good listener who guides you to the sale and knows your pains, struggles, goals, aspirations, and motivations for wanting to solve your problem.

The ONLY Type Of Employee You Want In Your Business

Now, before I share with you how to find great closers, click here to watch this quick video about the 3 kinds of employees >>

This video will teach you the exact type of employee you want in your business and the ones you should avoid like the plague.

Now you know which employees you should avoid, here’s how to find the best closers >>

I’m willing to bet when you get to finding and hiring your closer, you may be tempted to hire someone who can “sell anything to anyone”.

In reality, you shouldn’t hire that kind of salesperson.

It sounds counterintuitive, but it’s true.

What you want is a “true believer” in your product or service.

Does that sound much more advantageous?

Click here for a deeper dive into why a “true believer” is a huge asset to your business >> 

How To Cut Your Losses When Your Closer Doesn’t Perform

You want to set your closer up for success, by giving them every opportunity to improve.

You must also give them a clear path to close more sales for you, thereby increasing their income in the shortest time possible.

You’ll want to give them achievable targets but you’ll also want to keep them challenged every month.

You want to know in advance if things won’t work out with your closer BEFORE they reach the end of their trial period, and here’s how you do it >>  

The #1 Mistake Entrepreneurs Make When Hiring

Profit is the ONLY reason you hire employees.

Even in an admin role, that employee takes over tasks you do that keep you away from making money.

You’re always hiring to make more money in your business.

 So, if your closer doesn’t perform, you’ve got to replace them, but if you make THIS common mistake when hiring, it makes replacing them near impossible >>

How To Screen Potential Closers

Some people are great at interviews but when it comes to performing in their job, they fall flat.

That’s why they’re so good at interviews after all… because they attend so many.

Here’s a secret strategy for screening and testing your candidates without them knowing >> 

Your interview process is very important, so you’ll want to arm yourself with a great set of interview questions specifically for hiring closers.

You can get those here >> 

The Psychology Behind Hiring Staff

Finally, I wanted to give you something to think about.

Would you rather have a company of giants or dwarfs?

Smart CEOs know if they hire people less capable than themselves, they’ll end up with a company of dwarfs.

If you want a deeper dive into why I adopt the “Russian Doll” principle when it comes to hiring, which allows me to create a company of giants, click here >>

After consuming all this content, you should be in a great position to hire your first closer, and set both of you up for success.

To your success,

Dan Lok

P.S. – If you’ve been able to grow your business well but you’re wondering how to get to the next level…

Click here to watch my Advanced Expert Masterclass, where you’ll discover the strategies and secrets I and my clients use to have consistent six-figure months >>

How To Hire Your Next Superstar

This is something every expert, coach, consultant, or business owner should do, as the more value you give the more comes back to you in time.

So, today you’ll discover how to hire the right people for your team and how to build a powerful team of A players.

How To Build A Powerful Team

Business is a team sport, and as you know, you can only do so much as the CEO of your company.

I truly believe in hiring people who have greater skills than you in their area of expertise.

Because if you’re the most productive, smartest, and best-skilled person on your team, you’ll ALWAYS be the bottleneck.

Before you even think about hiring anyone, you must get CRYSTAL CLEAR on these 3 things >> 

One of the best ways I’ve found to build a powerful team is by finding out what your team members’ goals are.

What are they motivated by?

Figure this out and you’ll get the best out of your team.

How To Hire The Right People 

Once you’re clear on your vision, mission, and culture, you’re ready to find the people who’ll fit that culture and help you achieve your vision and mission.

After all, your business will never reach its full potential if your team doesn’t believe in what you do or fit the business culture.

I adopt a very unorthodox way of hiring talent.

In fact, I NEVER look at resumes.

I don’t care about their past, I care about their future.

I also care about attitude and culture fit.

I don’t even hire for skills necessarily…

In fact, a lot of my team members didn’t start out in their current roles.

I like to promote from within, so a few years after someone joins my team, they could be working in a completely different role.

If you want to know exactly how to build a high-performance team then click here to check out this in-depth video >> 

 

Why You Always Want To Hire People More Capable Than You

One thing I’ve noticed a lot is CEOs hire based on their insecurities.

Here’s what I mean.

If you’re always hiring people who aren’t as skilled as you because you think they’ll be easy to control, your company will find it hard to grow.

I mentioned earlier that you’d always be the bottleneck, but it’s far deeper than that.

Your job as the CEO isn’t to do each task better than your employees.

Your job is to be the captain of the ship…

The visionary…

The person who puts everything together and directs your employees to help you build the company’s vision.

That’s why you hire people who are experts in their field because it’s unlikely you have all the skills needed to build your vision.

Click here for a counter-intuitive insight into why you DON’T want to motivate your team, and what to do instead >>

 

How To Differentiate Between a Superstar and a Super-talker

When you’re looking for A players, here’s one thing I’ve learned.

There are people who talk a big game, and there are those who can deliver a big game.

Let’s pretend you’ve hired someone you believe will be a huge asset to your team.

Here’s how you find out which category they’re in.

You give them what I call a lame horse.

If they produce great results with the lame horse, only then do you upgrade their horse and watch them soar.

Click here to discover how to give your next team member a lame horse so you can monitor their progress and upgrade the horse when the time is right >>

 

How CEOs Communicate Effectively To Their Team

Here’s something that trips up a lot of CEOs, including me, [Name].

You see, it doesn’t matter how clear you are on your vision and mission and how high-performance your team members are…

If you can’t communicate with them effectively, the tasks you give them won’t be executed with precision.

I’ve had moments in my business where I was absolutely crystal clear on what I wanted the project to look like…

But when I received the first version, it was nothing like I thought I’d explained it.

I realized that I was the issue.

I needed to get better at explaining how I wanted the project to look.

Communication is the message sent, message received, and message acted upon.

If you’d like to see a roleplay of how to communicate effectively with your team members, then watch this video here >>

 

How to Get Crystal Clear On Where Your Business Is Headed, So You Can Lead Your Team To Victory

Before we wrap this up, I wanted to share with you a powerful way to gain clarity on your vision, mission, and business so you and your team can operate at the highest levels possible.

I know it’s not related to hiring a team member, but as we’ve moved on to getting the best out of your team members, I think it’s relevant.

The secret lies in what I call “think time”.

Every day I set aside a certain amount of time to think about where my business is at.

I ask myself 3 simple yet powerful questions >>


These questions allow me to figure out the best next steps forward and much much more.

Every successful person I know allocates time to think time.

Because you’re busy every day, you don’t have time to sit down and think about things.

That’s why think time is so important.

In closing, the word “clarity” has come up a lot in this newsletter.

Getting crystal clear as often as possible will help you in every aspect of your business from making key decisions to hiring the right people and more.

Until next time, go high ticket,

Dan Lok

P.S. – If you want to hit 6 figure months you’re going to need complete clarity on your high ticket offer.

So, if you’d like an insight into how I create irresistible high ticket offers that allow me to have consistent 6 figure months, then click here to watch the Advanced Expert Masterclass >> 

Not Sexy, But VITAL For Your Biz Growth…

It’s time we talk about one of the least sexy parts of business…

Everyone online always talks about sales, revenue, and cash in the bank.

But what about the numbers that drive those figures?

I’m talking about marketing metrics.

As you may know, marketing online can get confusing.

You’ve got email marketing, social media marketing, paid advertising, Search Engine Optimisation, sales page conversions, and the list goes on.

So, today you’ll discover some of the most important metrics to pay attention to regarding the marketing channels above…

In the hope that you can improve your marketing so you can see even better results in your business.

Let’s get started

How to Tell If Your Email Marketing Is Hitting Or Falling Flat

Since you’re reading an email newsletter let’s start with email metrics.

Your ‘Open rate’ will give you a clear indication of how your subject lines are performing.

According to mailchimp.com, the industry average for all industries is 21.33%. 

You should always aim to improve your open rates, and you can do this by split testing two subject lines at once.

There are a few ways to split test, and your email software should do this automatically for you. 

Essentially, you’re testing two subject lines to see which has better open rates, by sending to only half the list, then the software sends the remainder of the emails to your subscribers with the better-performing subject line.

Over time, you should have a good idea about what your audience responds to, so you can maintain high open rates.

If you’d like a list of eye-watering subject lines that compell your readers to open your emails, then click here >>

You should also keep an eye on how many people unsubscribe, so you know how your content resonates with your audience.

The second metric to monitor is the Click Through Rate (CTR).

This will be the percentage of people who click on the links in your emails.

Mailchimp.com states the average CTR across all industries for emails is 2.91%.

This metric achieves two things…

Firstly, it helps you to know whether your Calls To Action are good enough for your audience to take action on.

Secondly, it lets you know how compelling the body of your email is, so they actually read far enough to read the CTA.

Now, you may not know which needs improving straight away, but at least you’ll know something needs improving and you can slowly optimize your emails to increase your CTR.

If you’d like some tips to improve your email CTR, then watch this quick 1-minute video >>

How To Track Paid Marketing Metrics

Paid ads can be a great tool in an entrepreneur’s toolbelt for growing their business.

As far as Facebook is concerned, there are multiple objectives you can choose to achieve with your paid ads.

These include getting more traffic to your offers, increased engagement on your boosted posts or ads, increased video views, and lead generation amongst others.

Your metrics here will really depend on the objective you’ve set out for your ads.

For instance, a conversion could mean you make a sale, but it could also mean you acquire a new lead.

For paid ads, common metrics to monitor are Click Through Rate (CTR) and conversions.

As with email marketing, the CTR is the percentage of people who click the link on the ad, out of everyone who views it.

According to growthmarketingengine.com, the average CTR for Facebook ads is 0.9% across 18 industries. 

Here’s a video that will help you increase your paid CTR so you can pay far less per click >>

How To Make Your Ads Pay

To ensure your paid ads are profitable, you must know your ROAS (Return On Ad Spend).

This is how much revenue your business makes for each dollar it invests in ads.

This metric is even more important than your conversion rate because you could have high conversions, but if your margins aren’t high, then your ROAS will be low.

Done incorrectly, paid ads are a good way to burn cash and FAST!

Done correctly, paid ads will become your license to print money!

So, click here if you want to know how to increase your ROAS on your Facebook ads >>

While we’re talking about ROAS, there are three more very important numbers you MUST know if you want to scale.

These numbers are your Cost of Acquisition (CAC) per customer, your Customer Lifetime Value (LTV), and your cost per lead (CPL).

I shot you a quick video where I break down these numbers and why they’re so important >>

How To Get The Best Bang For Your Buck With Social Media Marketing

Even though social media marketing is free, you shouldn’t underestimate its power.

I know organic reach may not be as wide as it used to be, but there are still benefits of social media marketing, especially if you use TikTok which still has phenomenal organic reach.

Social media metrics give you a good understanding of your brand awareness and referral traffic to your website.

Engagement is key on social media, so even though it’s free, it pays to put a good amount of time and effort into your content.

Key metrics are likes, comments, and shares.

These are commonly known as vanity metrics, but they’re important if you want to know how engaged your audience is.  

Many believe free marketing like Facebook and Instagram is dead, but there are still ways you can increase your engagement on those platforms.

Here is a great video to increase your engagement on IG in 2022 >>

And if you want to increase your Facebook engagement, then you’ll want to watch this video here >>

In the interest of time, I don’t want to make this newsletter too long.

There are other marketing metrics you could consider concerning your Search Engine Optimisation, your sales pages, and your website.

Perhaps, I’ll save those for another newsletter, but I believe you have enough here to help you optimize key areas of your business to see HUGE results.

And of course, you’re welcome to do your own research for ways to improve a specific area of your marketing.

Until next time, go high ticket,

Dan Lok

P.S.If you want to know how to scale to $100K per month, then do yourself a favor and block out just 30 minutes to watch my Advanced Expert Masterclass >>

Inside you’ll get the exact strategies my clients and I used to hit consistent $100K months.

7 Types of Investors: How to Invest And Build Up Your Ideal Portfolio

Are you wondering how many types of investors are there? Every day, there are people who fear losing money in an investment, while others never fear it. In any industry, investing has its own language. Many people are skeptical about where they invest their money because they don’t know how to build an ideal investment portfolio. 

When it comes to investment. Most people may think of their homes or cars, for example. Rather, i’m talking about different types of investors. Which i’ll be sharing with you shortly. 

Think of an investment portfolio as a safe to store your valuables. For example, real estate, stocks, bonds, mutual funds and so on. But an investment portfolio is more of a concept. Not a physical item. 

If you know how to invest and build your investment portfolio, you won’t fear changes in the stock market. You’re wise enough to know that you don’t need to make more money to be able to save it because saving isn’t the answer.

Saving your money may help with future debts but it isn’t going to get you to financial freedom. What you need to do to build your wealth is to invest it, and the amount you invest has nothing to do with income level. 

Rich people focus on investing. Poor people focus on saving. Click To Tweet

Instead, what you invest is an indication of your financial confidence: your knowledge and skills when making decisions about money. 

With that said, understanding what an investment portfolio is doesn’t tell you how to build one. First, you need to know the types of investors. And then you have to learn how to invest. Only then, you’ll be able to build your ideal portfolio. 

Watch this video about how to get started. 

Take Time to Learn The Types of Investors 

It’s important for entrepreneurs to take the time to learn the types of investors. Why? Because they are unique players in the growth process of a business. To determine a company’s success or failure is ultimately determined by the level and quality of an investor’s involvement. 

There are plenty of stories about people using their own savings to invest in a company. Many still deeply rely on investors. If you depend solely on your savings, you’re not likely to grow as big as you want it to be. Having an investor can play a big role in your success. As i said earlier, your growth process is determined by the level and quality of an investor’s involvement. 

Now, let’s get into the 7 types of investors.  

1. Banks 

A bank loan works the same as any other business investment. The entrepreneur is required to present a business plan, and then the bank will decide whether they should provide the funds. Also, you may need to provide some proof of collateral or a revenue stream before your loan is approved. 

According to Investopedia, if you want to fund the expansion of your small business. Consider a Small Business Administration (SBA) loan. However, if you have access to other financings with reasonable terms, then you are not eligible for this loan. This is a good loan to apply if you did not qualify for a traditional bank business loan. 

2. Angel Investors

An angel investor is a high-net-worth individual who provides financial aid to help the business get off the ground. They are often found among entrepreneurs’ friends and family. Typically, angel investors provide financial aid in exchange for ownership equity in the company. And this is usually a one-time investment to assist and support a company through its difficult early stage. 

Now, this type of investment is risky, because it doesn’t represent more than 10% in your investor’s portfolio. But since they focused on helping startups. Therefore, they are the opposite of venture capitalists. 

3. Venture Capitalists

So, what is a venture capitalist (VC)? A venture capitalist is an equity investor. They focus more on companies that exhibit higher growth potential in exchange for an equity stake. VC investors could be funding a startup that wishes to expand but doesn’t have access to equity markets. And usually, they do not. 

The difference between angel investors and venture capitalists is that. They are willing to take higher risks because they know they can earn a higher return on investments (ROI) if those companies gain success.

So, whether you’re seeking an investor or looking to be an investor. Understanding the types of investors is important in today’s world. 

Here’s the top 5 value of venture capital investment in the 3rd quarter of 2019. (by industry)

4. Peer-To-Peer Lenders

Embracing technology in today’s digital landscape is a must. Peer-to-peer (P2P) lenders consider businesses and projects that are listed online. There are 2 websites that specialize in peer-to-peer lending. There are,

This type of investor acts similarly to the Small Business Administration (SBA) Loan. Now, when it comes to peer-to-peer lenders, your credit history plays a part when engaging a P2P lender. So, check and improve your credit history before finding a P2P lender. Because, if you have a low credit score, they may not find you loan-worthy. 

On another note, make sure you understand the terms and conditions on your loan and make payments on time. Failure to do so will result in increased fees and most likely won’t get you another peer-to-peer loan. 

5. Personal Investors

This may sound the easiest of all types of investors. But think twice before heading in this direction. It is always a risk when mixing business with family. Not only do you risk your finances, but also your family and friends if the business goes downhill. 

When choosing this option, make sure your family ties are strong enough to withstand the pressure. You can either have each party sign a promissory note on repayment terms or sign a partnership agreement.  

6. Corporate Investors

As a corporate investor, investing in startups carries a variety of benefits. This includes supporting their own growth and diversifying assets. While some invest outside of startups, more are leaning towards starting their own accelerators and incubators programs. 

These types of investors can be great collaborators. However, a careful approach with a lot of patience must be taken into consideration. In order to have an enjoyable relationship between founding partners and corporate investors. It’s vital to understand each other and have some boundaries agreement. 

7. Accelerators and Incubators

Accelerators and incubators are perhaps the ultimate gateways to a variety from the types of investors on this list. Why? Because, if you’re accepted into one of their programs. You may receive from $10,000 to $120,000 dollars to develop your idea for growth. The best part about this is, you’ll be able to benefit additional knowledge and resources. 

However, there are certain things to consider when joining the program. So, if you’re looking to take your business to the next level. Be ready to hustle. 

Building an Investment Portfolio

Markets go up and down. Investing isn’t a game and certainly, it’s not something that you could acquire in the shortest period of time. You can’t achieve perfect performance through market timing. However, you can build up your ideal portfolio. A solid portfolio certainly will allow you to succeed and avoid the stress within market volatility. 

If you know how to invest, you know how to build your investment portfolio. Click To Tweet

Your investment portfolio is like an umbrella for all of your accounts and they consist of some of these, 

  • A 401(k) or employer-sponsored plan.
  • Cash in savings accounts or invested in certificates of deposit
  •  Individual retirement account

As i said in the beginning, your home and cars aren’t considered part of an investment portfolio. Rather, i’m talking about how you can use your money to make money. Such as, 

  • Stocks
  • Bonds
  • Mutual funds
  • Real estate investment trust 
  • Alternative investments
  • Private companies

So, if you understand how money works, that’ll help you build your ideal portfolio. And diversification is the key to success when investing. Also, when you understand the different types of investors. you’ll have clarity on investing principles. Here are 5 essential guides to building your ideal portfolio.  

Have a Purpose and Stay Committed

Ask yourself this question before you invest. Why do you want to invest? Maybe it’s for your family or it could be generating an additional stream of income so that you can achieve financial confidence. Or maybe you want to buy a second home. Most likely, your answer could be all of the above. So, if you are aware of your purpose and you already know what you want to accomplish. What would it take you to get there? And out of these 7 types of investors, which would best fit you? 

Solid Understanding of The Fundamentals

To build your ideal portfolio is not just investing blindly. Understanding the fundamentals of individual securities is crucial to building a solid portfolio. And that’s what they are assembled based on. 

Your ideal portfolio should be diversified across sectors that are expected to perform well. Plan and have a good strategy to execute your purpose. Think quality over quantity. Click To Tweet

Give Yourself Some Time to Build 

This is critical because building your portfolio by identifying your purpose requires you to link all of your ideas. So, when you understand the types of investor that suits you best, you need to give yourself some time. Such as, what you need to achieve? So, based on your solid fundamentals, and a proven approach. It keeps you away from in-and-out, market-timing types of investing approach.  

Focus on Things You Can Control

There are certain things you wish you could control. Such as, the market, companies that you’ve invested in and the political views. The truth is, you can’t. However, with your individual approach and mindset, focus on the things you can control. Determine a powerful strategy and stick with it. 

Be Realistic With Your Goals

While most of us know how much we have saved. Very few have a realistic understanding of our goals. You might have an inkling of what you spend today and how much you need for the next stage of life. Maybe, you have a 5-year plan. But, how much risk are you willing to take on to achieve your goals? And does your 5-year plan look realistic with the steps you’re implementing? 

What You Invest is an Indication of Your Financial Confidence

Your knowledge and skills when making decisions about money is critical. The way we save and make money can be grouped into seven types. I learned about these seven levels of investors from Robert Kiyosaki, and over the years, i’ve put my own spin on it. 

While it’s common for one investor to drift a little from one type to another, most people stay fixed at one type for their entire lives.

[bctt tweet=”Saving your money may help with future debts but it isn’t going to get you financial freedom. You need to build your wealth to invest it, and the amount you invest has nothing to do with income level. ” username=”danlok” 

As i said in the beginning, if you know how to invest and build your investment portfolio, you won’t fear changes in the stock market or unexpected bills. But most of us still have a certain fear when it involves money. Now, how to create that confidence to achieve financial independence? – to break-free from your fears. 

The most important quality for an investor is temperament, not intellect. – Warren Buffett

Before i share the secrets of the rich with you. Which level of investor you are? 

Level 0: Non-Existent Investor

At level zero, you have no investments or savings. You are oblivious of money matters in general or your spending habits in particular. You usually complain that you aren’t making enough money, or if you made just a little bit more money, everything would be okay.

The problem is your money management habits. Mike Tyson is an example of a non-existent investor. During his 20 year career, his income exceeded $400 million. Yet before his 39th birthday, he was $8 million in debt. Then $30 million, so he was $38 million in debt. 

You might say, someone who makes millions a fight can’t be broke. But his financial statements say otherwise. He has the cash flow of a poor person. In fact, he’s worse than the poor. If your net worth is zero, you’re richer than him. 

Level 1: The Borrower

If you’re a borrower, you’re often in far worse financial position than the non-existent investor, although your potential for change is greater. You usually make a bit more money than level 0. You have high debt because you spend all you make and more. Your idea of financial planning is to get a new Visa or Mastercard. 

You live in complete financial denial and have often come to believe the situation is hopeless. When you are depressed, you buy more and get more debt.

Level 2: The Saver

As a saver, you usually set aside a small amount of money on a regular basis. The money is usually deposited into low-risk, low-returning vehicles such as a term deposit or money market account. You save to consume. 

You save to go on a vacation, then save to buy a car, or save to buy a big TV. You are afraid of financial matters and won’t take risks. In fact, you’ll drive many hours to save a few dollars or line up on Boxing Day for 10 hours to save on one item. 

Level 3a: Passive Investor

Passive investors are aware of the need to invest and top up their RSP or 401K by making employee contributions or outside investments like mutual funds, shares, stocks, or bonds. This level makes up two-thirds of the middle class. If you’re here, you’re financially illiterate. You don’t like to take risks.

You like to say things like, “I’m not very good with numbers,” or “I prefer to leave the money decisions to the professionals.” You’ll leave things in the hands of your financial planner but have little idea where things are invested or why. You also believe high rates of return like 20 percent are either illegal or impossible. You believe what you read in the news and do what others tell you to do. 

Level 3b: Passive Investor Gambler

At this level, you don’t like to take risks but you also like to use sophisticated investment techniques such as margins, puts, and calls, without understanding what you’re really committing yourself to. Most of the time, you don’t discuss your losses with anyone, but always brag about your wins. You like to gamble. 

I’ve seen entrepreneurs work very hard their entire lives to accumulate quite a bit of money. Then they take another person’s advice and in one year they lose what took them 10 years to make. It’s in the nature of entrepreneurs to work hard, so they’re smarter next time. But they’ve already lost decades of time because they took a gamble. 

Level 4: Automatic Investor

Automatic investors are aware of the need to invest but they are also actively involved with their investments. If you’re at this level, you have a long term plan that will enable you to reach your financial objectives. You follow the plan of the wealth triangle: you have a high-income skill, build a scalable business, and have high-return investments. 

You don’t use the fancy stuff that money managers use, like options or margin accounts. You buy good shares, proven managed funds or solid funds, and hold them for the long term. Warren Buffett is an automatic investor.

Level 5: Active Investor

If you’re an active investor, you manage your own money and don’t trust other people with it. You have a clearer awareness of investments and rates of return. You don’t necessarily take the advice you hear. 

For example, i’ve worked in finance. I can say that 97 percent of mutual funds don’t work. Only 3 percent of the 5000 funds in Canada work, so i would not take the advice of financial advisors.

Active investors have to be clear on investing principles, which are the rules of investing. Your vehicles might be real estate or private companies. You actively participate in managing your investments and don’t just put aside your money and hope it grows. 

You’re always looking, monitoring, and seeing how you can add value. You optimize performance and minimize risk, getting long term annual returns of 20 to 100 percent. You intimately understand money and how it works.

This type of investor has cash flow. You spend what you want after your assets crank out the cashflow for you. I am at this level. 

Level 6: The Capitalist

Few reach this level and fewer manage to remain there. They are the Rockefellers, the Kennedys, the Fords, the Bill Gates, the Warren Buffets. They have two motivations for investing: they are good managers of their money while they are alive, and they leave a legacy to continue after they are gone. 

Discover The Secrets of The Rich

No matter what your income level is, start investing. Have a financial plan for your future. Begin at the first level and work your way up. Remember, investing is about how much money you keep and what you do with it. So, do you want to learn the secrets of the rich? How do they invest, and build their ideal portfolio? How do they stay rich by investing? 

To the select few of you… here’s your chance to learn from me in person. As i said in the beginning, many people are skeptical about where and how they should invest their money. And this is what i realized.

The secrets of the rich aren’t taught anywhere. So, I decided to show you how it’s done. And because you might have the same question as my followers and mentees. To answer these and many other questions, you’re invited to my event in Vegas i’m holding with my good friend. And the question is, “Dan, how do I grow my savings predictably and sustainably?”

  • Without losing to inflation.
  • Without risking it all on the latest opportunities that could be gone with the wind.
  • Or without keeping it in my low-return savings account?

If you want to discover the secrets of the rich. You must have the mindset to give more, do more and be more…

Learn the secrets of the rich. And change your life forever.