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Wealth Building & Investing

Don’t believe 6 figures can happen for you?

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Quick question…

Do you want to make 6 figures?

If so, then read this email very carefully, because I’m going to break down how to make it not just possible, but probable.

First things first, there’s a lot that goes into hitting your first $10K month…

No matter whether you’re working a job or you have a skill-based business like copywriting or closing.

Why You Must Believe 6 Figures Is Possible

You must first BELIEVE it is possible to make 6 figures in one year.

You must also believe it is possible for YOU.

Seeing others make 6 figures is one thing but if you don’t believe you can, then you never will.

You may have heard me say this before, “You’ll never make $100K with $50K per year habits”...

And it’s very true.

Because if you want to make 6 figures, you’re going to have to cut out all the things that don’t serve you.

TV, video games, partying, and anything else that eats your time but offers little return.

It’s possible you can do those things again after you see some success, but the question is ‘will you still want to?’

You should start viewing yourself as the CEO of your own business, and your business is your life.

Everything in your life should be worked on to be optimized, including your health and relationships, but today, we’ll talk optimizing your wealth.

How To Simplify Your Income Goals

I know $100K+ can seem like a lot of money.

Another part of making 6 figures is believing that it’s easy.

I like to break it down into a daily income goal, which I explain in under 2 minutes here >

If you’re working a job and there’s just no way you could ever get to $10K in that position, then the best option for you is to start a side hustle with a high income skill.

That way you can make money in your free time.

If you want to know what side hustles you could start to make up to $200 per hour, then click here >>

If you’ve been following me for a while, you’ll know I believe a high income skill is the best way to make your first 6 figures.

Different Ways You Can Use Your Skills To Make 6 Figures

Depending on your skillset, you’ll need to structure your deals and pricing in a certain way.

If you’re a closer, you’ll likely make 10% per sale, so you’ll want to partner with clients who have high ticket products or services.

If your client’s package is $5K, and you make $500 per sale, you’ll need to close 5 sales per week to make $10K per month.

In this video, I break down some other ways you can use your skill to make 6 figures >>

If your skill is Copywriting, then there are 3 key things you must do to increase your earning potential and hit 6 figures.

The first two are obvious, but you’d be surprised at how many copywriters either overlook them, or ignore them completely.

The third one is less obvious and VERY counter-intuitive.

If you want to know the 3 things you must do to increase your copywriting income, then click here >>

What To Do If You Feel Like You’re Running Out Of Time

Now, you may feel as though you’re getting older faster, and time is of the essence.

If so, how do you master a skill fast?

If that sounds like you, then click here for the fastest way to master a skill >>

The good thing is you don’t need to master a skill to make 6 figures.

In fact, if you mastered any skill, you’d be making far more than 6 figures with it.

All you need to do is get good enough to make 6 figures.

But What If You’re Younger And Feel Lost In Life, What Do You Do Then?

In my opinion, narrow down a number of things you’d like to try and try each one until you find something you love.

If you’d like to know what one of my successful mentees Stephen did when he was in his early twenties and lost, then click here >>

A Final Piece Of Advice Most Never Think of When Striving For 6 Figures

When I was younger people would ask me all the time to do odd jobs for them.

I told them “I’ll pay for someone to come and help you, but I won’t do it.”

My goals were too important, I had to be working, and the same goes for you.

Let’s say you’re mowing the lawn to save money, and it costs you $25 per hour to hire someone, but your hourly rate is $50. 

You’re not saving $25 per hour, you’re losing $25 per hour.

Because in the time you spent saving $25 you could have made $50.

Just some food for thought.

Now, you’re armed with the right strategies to make 6 figures a reality, I wish you all the best and hope you achieve your goals.

To your success

Dan Lok

P.S. – If you’re yet to get started with a high income skill and you’d to use the written word to hit your goals, then click here >>

If you’d like to use your phone to hit your goals and connect with prospects all over the world, then click here >>

Counter-Intuitive Beginner Investing Tips..

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I used to get a lot of questions about investing…

Where to invest…

How to invest…

How much to invest…

So, today I thought I’d compile some of my best info and strategies on investing for you.

Ready?

How To Invest Your First $1,000

If you’re like most people, you’re probably thinking you could invest in crypto, stocks, real estate, index funds, or perhaps many other things.

But if you’re looking for consistent returns on your money, what return could you realistically expect from those investments?

5%, 10%, maybe a little more?

Of course, I’m not talking about when stocks or crypto go crazy and you can 10-100x your money.

That’s high risk and you could just as easily lose all your money.

I’m talking about growing your money over time with certainty.

So, I shot you a quick video on how to invest your first $1K, and I’m almost certain you’ll be shocked at my recommendation >>

How To Retire With At Least $1 Million 

Over your lifetime you’ll easily earn at least $1 million dollars.

But when it comes to having $1 million in a retirement fund (which by the time you retire won’t be worth much, if inflation keeps going the way it’s going)…

People seem to think it’s unattainable.

But if you really think about it, you could easily retire with at least one million dollars, using just one investment strategy.

In this video, you’ll discover how to have a 1 million dollar retirement fund with a set and forget system >>

My 5 Top Investing Tips

As you may know, I strongly believe in my Wealth Triangle Principle.

If you’re unfamiliar with it, I’ve included the diagram below.

Wealth-triangle

The Wealth Triangle states that in order to become a financial success, you should start with a high-income skill before you start a scalable business.

Ultimately, you’ll invest in high-return investments with the excess cash flow your business generates.

But it may surprise you to know that you don’t need a scalable business to become financially successful.

Business isn’t for everyone, as not everyone has what it takes to become a successful entrepreneur.

I may not win any fans with that statement but it’s true.

So, in this video, you’ll discover how one of my friends built a real estate portfolio of around $20 million without a scalable business >>

How To Invest In At Any Age Until You Retire

If you’ve watched some of the previous videos I linked above you’ll know that I believe the first investments you should make are in yourself, your skills, and your knowledge.

But if you want to invest your money elsewhere, it pays to keep it simple and invest in what I call the big 3.

Business, stocks, and real estate.

If you look at the most successful investors, they largely have very similar investment portfolios.

Now, I believe that everyone should have 3 types of financial plans…

And I discuss these in detail in this video >>

These plans give you a multi-pronged attack to create wealth and build a solid retirement fund.

How The Rich Invest Their Money

Although there are many “Bitcoin” millionaires out there…

If you look at the majority of people who’ve invested their money, you’ll see Bitcoin millionaires make up a small percentage.

As Warren Buffet says “If you don’t understand it, don’t do it.”

If you want to invest like the rich, that is one piece of advice you shouldn’t ignore.

Investing is like any skill.

It takes time to get good, and you will improve over time.

Sure, you’ll make mistakes here and there, but if you’re smart you can minimize your errors and remove any emotion from your decisions.

Over the years I’ve developed my investing skills and become very successful at it.

So if you want to know how I view investing and get an insight into 3 ways the rich invest, then click here to watch this short 6-minute video >>

7 Timeless Investing Principles

If you’ve been tracking with me through this whole newsletter I commend you.

Most people won’t even set aside a small amount of time to better their financial situation or their life.

If you’re a bit short on time, I’ve put together a small compilation of some of the best tips and strategies in the links above into one video.

It’s just 8 minutes long and one of the most powerful strategies inside will teach you exactly how you should divide your money up each month.

This ensures you have money for necessities, emergencies, investing, education, and of course FUN!

So, click here to watch this video if you’d like a quick summary of some of my best investment and financial tips >>

I hope you’ve enjoyed this edition of High-Income Skills weekly.

Remember, you have everything you need to create a wildly successful life for yourself.

To your success,

Dan Lok

P.S. – If you’ve decided investing in yourself is the best option for you right now, then click here to check out the Dan Lok Shop >>

We have a wide range of digital programs that will help you take your income to the next level.

From, closing, to copywriting, to confidence, to marketing, public speaking, and much more, I’m certain you’ll find something there to propel you forward.

Want Multiple Income Streams In Your Biz? (Read This)

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One of the most powerful things you can do for your business is install multiple income streams…

So, in order to help you do just that, in this week’s edition of High Ticket Weekly…

You’ll get 7 income streams you can add to your business, and if you read until the end…

I’ll show you a way to make money EVEN when people don’t buy from you.

Now let me stress something VERY important before we go any further.

DO NOT ATTEMPT TO DO ALL THESE AT THE SAME TIME.

That’s a sure way to develop shiny object syndrome and you’ll achieve very little.

So, do these one at a time.

Once you have one stream generating a solid and consistent income each month, you can move on to a new one.

Let’s dive in.

Books 

These could be physical books, kindle, ebooks, and even audiobooks.

Now, unless you’re selling hundreds of thousands of copies, it’s unlikely you’ll make a huge amount of money with books.

But one thing you can use books for is to position yourself as an authority in your marketplace, niche, or industry.

Books can open up a world of opportunities that may not exist without them.

When I was starting out as a copywriter I had a client hire me just because I had written a book.

If you’ve never written a book before, and you want to know how, then check out this 5-minute video I recorded for you >>

Digital Courses

Digital courses have completely changed my life and business.

I’ve sold tens of millions in digital courses in my career.

In fact, my High Ticket Closer Certification sold over $10 million alone.

Digital courses are a great way for you to showcase your expertise, and get it into the hands of people all over the world.

They’re easily scalable, and you can also use them as a down-sell for people 

who can’t afford your high ticket coaching or consulting.

Here’s a great video by a 7 figure course creator on how to create an online course that SELLS >>

Membership sites

Here’s another way you can sell your digital courses and expertise.

If you have multiple courses or one big course, you could charge a monthly or annual fee for access to your content.

You can give them all the content at once, or drip-feed it over time.

They’re a great way to build recurring revenue and are one of my favorite income streams for this reason.

Here’s a value-packed video on how to create a successful membership site that generates passive income for you every month >>

Events

Events are something we’ve been doing a lot of recently.

We run the S.M.A.R.T. Challenge™ a few times each year which is a completely virtual event.

We’ve been running live in-person events at the Vancouver Club, as well as hybrid (in-person and virtual events), such as High Ticket Mastery™.

Events are a great way to connect with your audience, and get a revenue boost…

But you can also use events as an opportunity to upsell your audience to your high ticket coaching.

So they can be VERY lucrative if done right.

If you want tips on how to plan and run a successful event, then click here to watch this quick 7-minute video >> 

Coaching/Consulting

This income stream is your bread and butter, but if you’re only doing one-on-one coaching at the moment, you may like to consider adding group coaching to your offerings.

Coaching sessions can be in-person or even online, as I’m sure you’re aware.

But here’s another coaching/consulting income stream that may surprise you.

VIP Days

This has the potential to be a HUGE payday for you if you set it up properly.

Businesses routinely pay me $70K for a day of my time.

During a VIP day, you would be consulting or coaching for the entire day, helping businesses solve problems to generate more revenue or coaching their staff, etc.

Here’s a 6-minute video on how you can make BIG money with VIP days >>

Speaking

Speaking is the highest-paid skill in the world.

Now obviously, you could speak at your own events, but you could also speak at other people’s events, businesses, and engagements.

Your options are charging an upfront fee, or if the opportunity exists, you can speak for free and sell from the stage and make money selling your programs or services.

If you want to know how to make BIG money as a speaker, then watch this quick 7-minute video here >>

If you’ve read this far, then congratulations.

As promised, here’s a way you can make money when people don’t buy from you.

It’s called affiliate marketing.

When I was younger I had very successful affiliate marketing businesses, and I still do affiliate marketing to this day.

So why is affiliate marketing so powerful and worthwhile?

Mostly because all you have to do is direct traffic to the offer, while the company takes care of fulfillment and customer service.

It typically takes a while to build up a solid affiliate income, but once you’ve got it to a certain level, it continues to grow and it’s money that comes in each month on autopilot.

I’m not going to link a video for affiliate marketing, because I don’t want you to become an affiliate marketer as such.

Instead, if any products you use and believe in have an affiliate program, you can begin promoting them.

So there you have it.

8 streams of income you can install over time into your business.

Don’t forget, only work on one at a time or you end up shooting yourself in the foot.

See you next time,

Dan Lok

P.S. – As I mentioned earlier, online courses are one of my favorite income streams.

This is why I’d like to invite you to a private masterclass where I show you how to get paid for who you are and what you know >>

It’s the fastest way I know of to turn your knowledge into a solid stream of recurring income.

Click the link above to get started.

High Ticket Ascension: A Guide for Beginners

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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.

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

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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. 

Why Cash Flow Is More Important Than Revenue

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Is your business struggling with cash flow in these uncertain times? This is the time when it’s especially important to understand why cash flow is more important than revenue.

As a business owner, it’s your responsibility to know about your business’ financials. If you don’t know it, who would? Even if you have financial advisors and experts on the team it’s best if you have an overview of what’s going on. Financials are the backbone of your business.

Understanding the differences between revenue and cash flow is even more vital in a crisis like now. Knowing the difference might save you from immense loss or even bankruptcy. If you completely outsourced all your financials so far, now is the time to learn about it and take it into your own hands.

Now is the time to make concrete and realistic plans. Positive thinking alone won’t get you out of a tight spot. Deal with the cold facts and develop a strategy accordingly.

Get yourself familiar with terms like cash flow, revenue, margin, and overhead and find out what your business has to focus on in these uncertain times. What’s important will depend on your business model – however for most businesses cash flow is the biggest issue right now.

Why is cash flow so important? How can you prepare your business to survive the crisis? And how can you allocate money fast? Those are some of the aspects we’ll discuss below.

What Exactly Is The Difference Between Cash Flow And Revenue?

The biggest difference is what the numbers tell us. Revenue tells us how much money your company made from sales. Whereas cash flow is much broader. It shows the total amount of money coming in and out. Cash flow also includes money coming in even if it’s not made from sales.

So while revenue shows the gross revenue coming in, cash flow shows the bigger picture. Revenue measures income, your cash flow measures your liquidity.

The thing is, revenue is usually calculated after you made a sale. It doesn’t take into account if you’ve already received the money. So maybe you made $10,000 on paper but you didn’t receive the money yet.

Cash flow is the actual money you have and it allows you to deal with short term financial demand. For example, you need cash flow to pay employees or vendors.

Revenue is more one dimensional. If you sell something for $100, then your revenue is $100. If you sell something for $1,000, then your revenue is $1,000. Simple as that.

Now cash flow also includes the money going out of your business. It shows you how much you have after all your regular expenses are paid. Cash flow allows you to make better predictions if you are breaking even, doing really good, or sliding into debt. So it’s way more important to keep an eye on your cash flow than on your revenue.

Why Cash Flow Is Even More Important In Times Of Recession

When the general economy struggles, cash flow becomes even more important. Do you know why are so many companies going out of business right now? – Because they lack cash. They might have all these accounts receivable but the money arrives on their account too late.

They need cash to pay their employees or even basic expenses like rent. If the cash doesn’t come in, they are gone.

Now, when the global economy struggles, here’s what happens. Almost all companies generate revenue. But it’s only on paper. The vendor of a supermarket might generate revenue from the last delivery.

The supermarket, however, couldn’t give them the cash yet. They made revenue from food delivery orders and are waiting for customers to pay. The customer ordered food with their credit card. They are an employee at a fashion company and didn’t get paid yet because their employer doesn’t have cash flow.

Do you see what’s happening here? It’s almost a vicious cycle. Only when the fashion company finally pays the employee the ball gets rolling. Then the employee can pay the supermarket and the supermarket can pay the vendor and the vendor finally has cash flow.

So, generating lots of revenue sounds great, but your business can’t survive until you are liquid. That’s why cash flow is more important than revenue.

How Can You Understand Your Cash Flow?

To run your business successfully or even weather the storm your business might be in right now, you need financial literacy. What exactly is that?

Financial literacy means you can understand your finances. If you look at financial statements then you know what’s going on in your business.

Many business owners make the mistake to completely outsource their financial affairs. They hire someone to do it. But really, if you don’t know how your company is doing financially how can you run it properly? How can you make wise investment decisions? That’s exactly why you need financial literacy.

When you look at your papers you need to understand which part is revenue and which cash flow. Only then will you know exactly how to react to it.

Now, every business is different and therefore has different cash flow behavior. Maybe your business has a stable stream of smaller sums. Or maybe you make huge sums but less frequently. It also depends on how large your expenses are.

Either way, nearly all cash flow behavior is disrupted in a crisis. You can expect to get paid slower but might be expected to pay faster. Your vendors will likely be less patient with you because they rely on your payment.

Your clients, on the other hand, might struggle and not pay you in time. It’s unfortunate but it can’t be helped. Instead of focusing on them, you need a game plan about what you’ll do if you need to pay faster than you get paid.

Know Your Data And Create A Plan

Now that you understand cash flow and have basic financial literacy, here is the next step. You want to get familiar with your data and make a plan.

It could be a 60 or 90-day plan, telling you the cash that will be required in the next period. After you have your plan, it’s time to get resourceful. An important thing to mind during this step: don’t manipulate your data to make yourself feel better.

Maybe you are facing the harsh truth that your numbers are in the red…or maybe you want to make some estimates which are too generous and not realistic, but would make you feel better…don’t do that. Be as honest with yourself as possible. Probably even better to be a tiny bit more pessimistic than you usual. Lying to yourself won’t get you out of tricky situations.

Most business owners will either underestimate or overestimate the cash flow they need. It’s hard to meet the exact number when you are making guesses and estimations. To be prepared for the worst, it’s better to overestimate than underestimate your cash flow needs.

Evaluate Your Resources

Now that you know your numbers, it’s time to look at your resources. Are you confident to make it through the next 60 or 90 days? Where can you get the money? Can you ask your bank? Is it readily borrowed?

Hope for the best but really prepare for the worst. Use the power of negative preparation and leave nothing to chance. Negative preparation means to ask yourself the questions: What do I not know? What am I not seeing? What’s the worst that could happen? These three questions will allow you to prepare for a worst-case scenario.

Again we want to stress, it’s important, to be honest with yourself about this. If you see no chance to increase the cash flow to your needs, what’s your backup plan? What do you do if something unexpected comes up?

Think about how you could possibly get more new (or repeated) customers in. That’s a good way to raise cash flow. Maybe you can tap into a new market? Maybe the crisis opened up a new opportunity for you?

How can you shorten the transaction length to get some cash flow earlier? Is it possible for clients to pay an amount upfront? Do you have private capital to invest in your business right now? Or could you find investors to support you? All of these are strategies to get you through when things are tight.

What To Include In Your Plan?

Besides cash flow, you also want to know your monthly gross margin. Now, what’s that? Your gross margin is basically telling you how much money you earn per sale minus the cost of getting your product sold.

For example, a digital agency might sell consulting for $2,500 but they also spend $300 on marketing. That means the gross margin for this product is $2,200.

If you had to adjust your strategy during coronavirus pandemic, then your margin might have changed too. For example, a restaurant that relies on a physical location has a certain margin. But now, they can only do delivery. The margin very likely has changed.

The next thing to think about is which expenses are absolutely necessary. What can be delayed and what can be cut completely? For example, you might still need your best employees to keep the business running. Their salary is a necessary expense you can’t delay. You’ll also need some form of marketing, to attract clients.

Delaying certain expenses gives you the opportunity to keep some cash flow for more urgent matters. What can you delay? Maybe there is a possibility to pay your rent a bit late? Are some higher-paid employees willing to take a temporary pay cut? Maybe even suspend their pay? Seek open communication with them about their current situation.

Should You Cut Your Marketing?

The marketing budget is usually the first thing you’d want to cut. It sounds like a good idea to keep your marketing budget so you have more cash flow right?

But remember, without marketing, you’ll have fewer clients which means flower cash flow. Marketing sometimes takes a while until the effects are noticeable. That’s why you think you can cut it for now. The potential risk is, however, that by the time the lockdowns are over you are left with no clients as you didn’t do any marketing.

Before you cut any expenses, do in-depth research and strategizing session. Even cutting the pay of employees can create long-lasting damage. It could destroy the team it took you years to build. Make decisions you feel comfortable with.

How To Increase Cash Flow

Now you know why cash flow is more important than revenue. But how can you generate more revenue during the downturn? Here are a few strategies.

Add A Strong Guarantee

First, you can increase your sales by giving better guarantees and warranties. This might sound counter-intuitive. Won’t your customers abuse your guarantee? If your product is good, then the opposite is true. Here’s why:

Most customers feel reluctant to buy because all the risk is on them. If there’s no guarantee the decision to buy is so much harder for them. If you offer a strong guarantee or warranty, you reverse the risk. All the risk is now on you.

But since your product is good and does what you promise it does, there’s nothing to worry about. Most people won’t use the guarantee if they are satisfied. So, for nearly all businesses a good guarantee (which has no loopholes) increases sales. But it doesn’t cost more to sell the same product with a guarantee. Hence, you have more cash flow.

Engage New Customers

Another great way to increase the cash flow is to actively look for new customers. What are some untapped markets you can branch out to? Maybe you’ve done a lot of local business and don’t have many online solutions? Now is the time to go online and build a customer base there.

Selling an online product is so great because you don’t have much overhead cost. For most, you don’t have to keep any stock – as the product is digital and not physical. The customer doesn’t have to wait for delivery but can get started right away. This is especially true for info products or online coachings.

Low overhead costs but increased sales result in more cash flow. Sometimes, what you sell only needs to be tweaked slightly so it can be sold online. It’s one of the best ways to increase cash flow during the lockdown.

Dare To Release Beta Products

Do you have any upcoming new products or services which aren’t fully finished? Instead of fleshing everything out to complete detail, it will pay off to release your product early.

Especially if what you created helps others to get through the downturn. For example, maybe you offer online coaching on how to take your business online. But the last two modules aren’t recorded yet. You’d want to release the program already and make sales as you finish it.

Most of your customers won’t mind or won’t even notice. By the time they get through the program, you’ll have everything set up for them.

Alternative Pricing Structures

If you need cash flow fast you might want to adjust your pricing structures. If customers aren’t able to pay the full price upfront, maybe they can pay half? Maybe even offer them a payment plan over the next three months – that way you get cash in every month.

Many businesses offer gift cards that allow them to generate cash now and take care of the fulfillment later. This is best marketed to customers who are already loyal and want to support your business during tough times.

You might be tempted to offer your product or service for cheaper for the sake of making cash flow faster. But often it’s not necessary. Just extending the payment period over a few more months helps. Fall back on payment plans before you start giving discounts.

Want More Money Habit Secrets?

You’d be surprised but most business owners don’t know much about the differences in revenue and cash flow. It’s easy to start a business but it’s a lot harder to maintain it – especially if an unexpected crisis hits.

You might have noticed that Dan Lok’s businesses have taken a very minor hit from this recession. He didn’t have to let go of any employees, he still has his marketing running and he released some new solutions in the last months.

How was he able to do that? The thing is, Dan Lok has seen five recessions during his time in business. So, he naturally adopted some money management habits that keep his business safe.

If you want to crisis-proof your cash flow and income, wouldn’t it be valuable to learn from his experience? Right now you can do so, with the Millionaire Money Habits Video Training. Right now you can get the training and save 50%. View all the details right here.

I hope you enjoy reading this blog post.

Schedule an add a zero session™ with our team to see how you can use our time-tested strategies and systems to scale your business now.

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