VII
Let's Make Money
When I was young I thought that money was the most important thing in life; now that I am old I know that it is.
- Oscar Wilde
51
Passive Income
When you’re an hourly employee, figuring out your hourly wage is very simple. For every hour you work you get paid a certain amount. If you work more than forty hours per week, you make more money per hour as a reward for working overtime. Even teenagers understand how this system works.
Let’s say you’re rocking the minimum wage game. You’re making $15 an hour. If you work forty hours per week, that’s $600 for you to live off of, before taxes come into play and start eating away at your income. Most places pay time and a half for overtime. So that means for hour forty-one you are going to get paid $22.50. When I was working hourly, I would have killed to make that kind of money. I only got paid seven dollars an hour when I first entered the world of employment!
That $22.50 might be the only way you are going to make ends meet. You are trapped, though. You can only increase your income by working more hours at this point. Unfortunately, there are only 168 hours in each week. Assuming that you never sleep, take breaks or go to the bathroom, your maximum theoretical income is $2880 for that overtime. You can make a maximum of $3480 per week including your base forty hours and 128 hours of overtime. That seems like a pretty good chunk of change, except it’s an impossible number, partially because most places aren’t open 24 hours a day, but mostly because if you don’t sleep, you’ll die.
When you are on salary, it’s a pretty similar experience. Instead of saying you get paid per hour, your boss pays you per week. That means that even if you work sixty hours per week your salary doesn’t change. There’s no overtime bump. You receive more benefits, such as medical insurance, but there is no chance to make extra money by working overtime. If you don’t work enough hours in the week, you lose your job, and your income drops back to zero.
The majority of our population operates under that pay structure.
You exchange time for money.
That’s the basic formula for life as an employee. The game is rigged against you because there are only so many hours you can labor and keep your health and sanity.
There’s a different way to live, and it’s a life worth fighting for. It’s a life based on passive income. I will write this book only once, but each time someone buys a copy I will get paid. Even when I’m asleep, I will make money, and that’s the key to my financial success.
Breaking the connection between time and money will unlock the freedom you have always desired.
This type of project comes with risk and it’s a risk I’m sure your spouse, kids, or incredibly nosy neighbor will want to jump in and point out. If nobody buys this book, I don’t make any money. No matter how hard you work on a project, you can still make nothing when you're the boss. I have worked on projects that died before they became financially successful. It happens. That’s why I am diversified.
Writing this book is taking a lot of my time. I’m not working on any projects while this is in development. I finished three projects earlier this week that will continue to pay me for years, so I can afford to invest the time. I can take a month off anytime I want. Despite the risks, passive and recurring income is the key to true financial freedom. Look at the life of any successful person that isn’t working a surgeon’s insane schedule, and I can promise you it relies on passive income, whether it comes from owning a store, playing the stock market, or writing books. It’s about working once and getting paid over and over, disconnecting the connection between time and income.
It’s the best way to remove the shackles from your life. We want to start projects together that continue to make money, even when you’re working on something else.
I’m not going to lie to you; initially, the ratio will be low. You’ll be putting in a LOT of time for very little financial return. That’s simply how this game starts. Over time, you will continue to improve that ratio. Here’s a simple example. Following my system for releasing books on Amazon, there is a baseline. For each book you put on Amazon you’ll make at least $100 a month. So the first month you work hard and release a book and make your $100. I know that sounds low.
But let’s think about it. The first time will take the longest because you are learning the system. The second month takes you only 60% of the time, and you make $200. Your ratio has just massively improved. Month three you work even faster and at the end of the month, you take home $300. Month four you work on something else, and you STILL make that $300. If you put out a book a month, you’ll be making $1200 a month in a year. Over time, because it is residual income, the ratio continues to improve. That first month of work will generate more than $2400 over the next two years. That’s not so bad for a month of effort. And believe me, I’m not talking about 40 hours a week to make that happen either.
We want to move in this direction. But before I jump into the different methods of making money, I need to learn a little bit more about you.
52
Assessment
We need to take an honest look in the mirror and assess exactly where you are right now. Take out a notebook and get ready to do some writing. This is a book about making money, and that requires action. The temptation to breeze through this section quite casually will be high. I know that! But I need you to understand something.
If you skip steps this early in the book, your odds of actually succeeding drop to below 10%. My system doesn’t work for slackers. It only works for trigger pullers. I have no idea how to help you make money if you do nothing. So I’m sorry to inform you, but your action is required. No one is watching you; I certainly can’t check your work. School is over; there’s not some guy peering over your shoulder here. To succeed when you are the CEO and the master of your destiny requires self-motivation.
The first thing you need to do is assess your current financial situation. You started this process earlier in the book when we set out your financial goals, and that’s wonderful. Now we want to dig a little deeper so that we can establish some budgets.
How much money do you have in the bank? How much debt do you currently have? For most people, that second number is larger than the first. We can work with that. We also want to look at all your current revenue streams. Maybe you have a job and get a little extra money from alimony, a lawsuit, or you even won a little something in the lottery. Wherever you have money coming in, you want to just write it down. You want to know your current financial situation. If your financial position is not secure, then you shouldn't invest a ton of money into courses and technology. For you, time is a better resource to use than money.
Either path can lead to success, but we don’t want to spend the wrong resource for your situation. The method I teach in this book and most of my courses uses time as your primary currency. You can then accelerate the process by adding money.
I prefer to spend money out of profits to grow a project, but if your time is more valuable, then you can easily hire people to replace certain steps in this process. Whatever your situation is, I’ve got you covered.
You need to create a budget for your business. How much money can you spend every month without hurting your overall financial situation? There are only a few fixed costs you need pay to get started. You need a computer and an Internet connection. Please don’t try to start a business with a tablet, that’s super hard, and I doubt that will succeed.
If you can’t afford an Internet connection right now, then you need to start doing some research. There are tons of places everywhere in the world with free high-speed Internet. Why do you think there are so many hipsters that spend twelve hours a day in coffee shops?
For recurring costs, you need at least fifty bucks a month. That’s enough to get into the game. I know most businesses require massive amounts of money to get going, but that isn’t useful for most people. When it comes to cash, I think
like a street fighter – I want to turn dirt into dollars.
This is why I hate physical businesses. Want to sell sugar water on a corner somewhere? Get ready to take out a bank loan. Did you know that most physical businesses try to see a 3-5% profit annually? Unless you’ve got enough capital to start and successfully run a half dozen places, those numbers are pathetic! I do things a little differently. If I invest $10 in a project, I want to make $100 back. No exaggeration here, I look for a ten-fold return on my Investment.
Now that we have a bit of baseline for your financial situation, we want to consider your value as a human being. By the way, I promise this will be a lot less depressing than the financial assessment, okay?
Let’s start with your hobbies. What do you enjoy doing in your spare time? For each of your hobbies, even if it’s only one, measure your expertise and passion levels. You can make a living quite comfortably just talking about something you love, something that you’re great at.
Pay special attention to things you’re great at, but other people aren’t – “watching Netflix” probably isn’t a great hobby because anyone can do that. This is the area where many people leave millions of dollars on the table. I have a relative who is magnificent at woodworking. This is something I’m super terrible at. I can’t build anything with my hands. It’s a skill that I and most of the population lack, so I came to him with a business idea. My idea was to make a blog with videos of him building different toys with his kids. I’m talking about tree houses, wagons, and other great classic wooden toys. I did some research and realized that by building a wagon for your kids with parts from a hardware store, you could knock up to seventy percent off the cost of buying one from a store. And that’s just for a wagon. We would target dads who couldn’t afford expensive toys and wanted to spend more time with their kids.
We would let them watch him building each project with the kids, so they would see how awesome it was to have that connection with your children. We would then sell the plans to each project for a very low price below the video. The dad gets to spend time with his kids and save, even factoring the cost of plans from us. It was a brilliant idea. When I came to him, my relative told me that this was a stupid idea, nobody would want something like that and that it would never make any money. He felt that his skill had no value.
A few years later a guy named Ted came up with the same idea. You can find out more about it at http://servenomaster.com/book
This guy Ted has woodworking plans for everything, not just stuff you build with your kids. He is making between ten and fifty thousand dollars a day. Because my relative thought his skill had no value and he decided to shut down my idea, he left somewhere in the range of ten million dollars on the table for someone else to make. Now, I’m not saying Ted stole my idea. He just had the same brilliant idea and had the guts to go for it.
Don’t decide that other people don’t want access to your skills. I’ve had conversations like that with a lot of people over the years who insist my idea is stupid right until someone swoops in and makes seven figures. I want you not to be selfish right here. If you are good at something manual or something unique, then don’t throw it away. Maybe you’re a brainiac rather than a hands-on type of guy. I had another friend who was a lawyer and a master of passing the Bar Exam. I wanted to put together a video course in that niche. He said no. Someone else is now a millionaire. Even smart people can make horrible financial mistakes and leave millions on the table.
Lawyers are just like anyone else. They get paid for the time they work. Why do you think they are always talking about billable hours? Most lawyers have to fill in a form every day explaining what they were doing for each three-minute block of the day. That doesn’t sound like any fun to me.
Whatever skills and specialized knowledge you have should go onto your assessment sheet. We want to see what you can offer people that you are already good at. That’s a great place to start.
The next thing we need to talk about is looks. I know it’s something we all want to avoid, but if you have a face made for radio, then we need to know that now. On the flip side, you might be really attractive. That’s part of the looks category. More of it is that you match the look of your project. What stereotypes do people think when they see you. It can be nerd, scientist or criminal. The answer won’t affect my ability to help you make money. It will only affect the path we select. Right now is about honest assessment, not judgment. I get a lot of hate mail telling me how fat I am. I’m no Prince Charming. I just accept that reality, and I adapt to grow my business. As I said at the top, this isn’t about anybody’s feelings. My only goal is to shorten the path between you and freedom.
Let’s talk about personality. Are you friendly and likable? Or are you more quiet and reserved? The idea here is to figure out if you should be doing videos or podcasts - or if you are better just using the written word. Take the time to listen to a few of my podcast episodes to see if that is something that appeals to you. (It is also called Serve No Master)
Your personality will color your project, and we want to make sure your identity is one that appeals to the audience you target. You may need to create a character or a more extreme version of yourself if you want to go down the audio or video route. Keep that in mind as you fill out this section.
The final part of your assessment is about equipment and resources. This includes software and even stuff you can borrow from a friend. Do you have any video cameras or lighting? How about sound equipment and microphones? Whatever you have that you can use for an online project should go onto your list.
Now we know what your baseline is. We can move forward and build a strategy with this information. I’m getting excited!
53
Garbage In - Garbage Out
Before we start talking about the business you are going to build, it’s important to understand that the quality of your effort will directly impact the quality of your financial returns for a very long time to come. If you decide to start a blog about a topic you hate, then your dislike is going to crash the quality of your work across the board. Why would you want to start a new career that you hate? If you’re reading this, the odds are that chasing an extra few bucks with something that “sounded good” is what got you here in the first place!
I only do projects that I enjoy. I thought of the name of this book a few years ago. I had the name locked down, but it took me a while to decide how I wanted to build the project. I was always excited about it, and I was waiting for the right moment. That moment is now. The stars have aligned. And here we are together. If I didn’t want to write about creating an amazing lifestyle of financial freedom, then writing this book would be a nightmare. I would hate going onto my website to write new blog posts. Because I am working on something I like, the effort is not a problem. Passion is the first crucial element.
You also need to focus on the actual quality of your product. I make a wide range of products for myself and other publishers. You can always tell when I’ve worked on a project because the quality is at least 10% better than anyone else. When I make a video course, I spend as much time picking the tiny icons that appear next to each bullet point as I do recording the actual videos. That minor detail is important to me. When you buy something I’ve touched, I want your first thought to be that you underpaid. I want to give you WAY more value than you expected. This applies to both content and presentation.
Whatever direction you want to go in, please start with the mindset that you will not cut corners. There are a lot of places on the Internet where you can buy PLR. This is where you can buy a book someone else wrote and slap your name on the cover. Then you can start selling it all over town. The problem here is that the book is going to be low quality. Now, that’s not to say I’m a zealot about the issue. You can use good PLR material as an excellent foundation if you completely rewrite the content. But most people won’t do that. If you try to shortcut the product-creation process this way, you end up selling some trash w
ritten by someone who doesn’t even speak native-quality English and your customer ends up with something that doesn’t help them.
Your goal should always be to provide the most useful content possible – it’s easier to sell! Eventually, every single topic in this book will end up on my blog. I have no desire to hide my knowledge behind a pay wall. That’s not a mindset for success. The reason you bought this book or grabbed it on Kindle Unlimited is because I organized the content into a usable structure. I arranged the book this way to give you a LOT of value. Also, I will not copy and paste between my blog and this book. I will write everything in a different way, for a different medium.
Even my free content I try to make as excellent as possible. That’s my goal and approach towards business and life. Everything that you create, sell or release into the universe is your legacy. The Internet never forgets. You might be tempted to cut corners as you are going through this process. The important thing is to learn what corners you can cut that don’t affect the experience of your customer. It takes a long time to figure out what they are. Perhaps you are familiar with the eighty-twenty rule. You will spend eighty percent of your time working on stuff that generates twenty percent of your income. It’s hard not to get pulled down rabbit holes. As long as you are limiting yourself to one project at a time, you protect yourself from going down a rabbit hole that leads to nowhere.
The book you’ve got in your hands right now is my legacy. People will be able to talk to my children about this book. That’s how I gain immortality. Every time someone reads this book, remembers me, or says my name, I extend my life a little bit. It is the only true way to live beyond the human lifespan. That’s why I’ll never sell or promote a product that doesn’t work. I will eventually recommend some resources in this book just like I do on my website, but I only recommend the stuff that I use.
Serve No Master: How to Escape the 9-5, Start up an Online Business, Fire Your Boss and Become a Lifestyle Entrepreneur or Digital Nomad Page 10