How Do You Play the Game?

This is something I read over the weekend. The lesson may not be new to people in the 90% Guardian, but I love how the story is told by the author of the book.

The story goes like this:

The author of the book, when he was young, loved to play the game MONOPOLY with his family. He noticed something very strange about his cousin: When his cousin plays, she never buys any properties, and only go around and around collecting the $200 as she passes GO.

It doesn't take a rocket scientist to know that there is no way the cousin can win by playing this way, so the author talked to his cousin:

Author: Why do you never buy any properties and only collect the $200 dollars?

Cousin: I want to make sure I am able to pay the rent when I step on other players' properties.

Author: But if you don't buy any properties, you will never win the game. You know this is a losing strategy.

Cousin: Yeah, but at least I get to play longer. 

According to the author, his cousin grew old and became broke, and she also became bitter at the success of others.

Now let's think of ourselves. Are we currently playing this financial game of life with a winning strategy? How many people are just doing what they were told they should do, so they get to "play the game longer"? How many people are playing a losing strategy, and yet don't even recognize their strategy leads them to nowhere.

I am not saying I am a know-it-all. Quite the opposite. I have always been pretty "conventional" in my plan. Go to school, find a job, work hard, move up the corporate ladder, and save money for retirement. We all heard those words. The strategy doesn't feel right, but for some reasons I always thought things would work out at the end, and I am somehow smarter than others who are doing the same and will win this game. It took the financial meltdown back in 08-09 and a loss of $10,000 for me to start increasing my financial intelligence and see there are more strategies to play this financial game called Life.

Ask yourself what your goal is, what you want to achieve, and see if your strategy aligns with your goals and will help you win. There is nothing worse than playing a losing strategy thinking you can win, or be willfully ignorant to play a losing strategy "just to play longer".

I don't know what your winning strategy will be, but it's certain that increasing your financial intelligence helps you form a better strategy. With higher financial intelligence, you can solve more financial problems, which helps you unlock the chest of opportunities. Always remember: If you want to be average, do what the average does. If you don't want to be average, be different than the average.

We are living through history. The greatest fiat currency experiment known as the US Dollar Reserve is slowly collapsing in front of our eyes. Never before has human civilization tried this at a global scale, it had never ended nicely, and this one is no exception. The average and unprepared will likely lose a lot, while those who are prepared will acquire massive wealth. Your choice is simple: Either you PANIC like everyone else and get frozen, or SEE THIS AS THE GREATEST OPPORTUNITY OF YOUR LIFETIME. The ticket to this greatest opportunity of human history is called financial intelligence. Increase your financial intelligence now, and this will be like a roller coaster ride. It will be thrilling and fun because you have your financial intelligence to hold you in position, while others may fly out of the cart because they are unprepared.

History is being made, and you bet this decade will be a decade remembered by historians. When your kids and grand kids ask you, "What were you doing during the greatest wealth transfer in the history of mankind?"

"I was sucking my thumb on the couch watching TV, my dear", surely will not be good enough.

How Network Marketing can Benefit You

Some of you may know that I am currently focusing my study on network marketing business. The question is, why network marketing?

In the business world, there are 4 groups of people: Employee, Self-Employed (a.k.a. Specialist, Small Business, Superstar), Business Owner, and Investor.

The characteristics of the 4 groups are as follows:
EMPLOYEE: You WORK a job, and you work in a system someone else built.
SELF-EMPLOYED: You OWN a job, and you ARE the system.
BUSINESS OWNER: You OWN a system and the system works for you!
INVESTOR: Your MONEY works for you!

And here is the unfair advantage: For the E and S, the more successful they become, the more they have to work, whereas for B and I, the more successful they are, the less they work! For E and S, if they stop working, money stops going into their pockets. For B and I, however, they don't have to work and money would still flow into their pockets!

In this case, it is pretty clear that financial freedom is MORE EASILY found in the B and I. You can still get financial freedom being E and S, it's just the chance is stacked against the E and S, because for E and S, money = work (not to mention taxation and inflation are NOT in your favor).

Out of B and I, I chose B to be my game.

Why B?

I am actually most interested in the I game. However, even though B and I are different games, there are actually a lot of things in common between these 2 groups. In fact, you will find that a lot of professional I's are in fact B's possessing I's skills. Instead of just OWNING investments, they run businesses that make investments. For example, if you are a professional real estate investor, you likely need to build a team consists of real estate broker, mortgage broker, accountant, attorney, property management team, and so on. If you are a professional stock investor, you likely will have a research and analysis team that will help you find the next gold mine. Sounds like running a business? You bet it is!

Also, in most cases business skills are required to run successful investments. For instance, in real estate, properties need to be managed like a business to be profitable. In stocks, you need to determine if a business is good before you put your precious money in the company's stocks. There is a lot of transferable skills from B to I.

Why network marketing?

This boils down to the complication in business.

To put it short, to be successful in B, you need to have a good business system, and the right people. If you lack one of the two or both, your business would ultimately fail.
And in general, there are 3 ways you can enter the B arena:

1. Start from scratch and build your own. This is probably the most satisfying and the most challenging path, since in this case, you need to take care of BOTH the system AND the people factor to be successful. If one fails, your business is doomed.
2. Join a franchise business. This approach allows you to purchase the right to use a proven system, so all you need to worry about is the people factor. If you want to be an entrepreneur without building a system from scratch, this is a good approach, as the franchise seller will give you training necessary to be successful in the business. The down-side of joining a franchise is usually the cost (usually quite high, ranging from $10,000s to $100,000s initial cost).
3. Network marketing business. In network marketing, you earn money by selling products to customers AND by recruiting people to join in your team to sell the product. Like in franchise, you will use a system that someone else built so you only have to worry about the people factor. Unlike franchise, however, the start-up cost is usually only in the range of $10s to $100s, and if the company is good, they will be patient in training you and preparing you with the skills necessary to succeed as a B!

In short, I found myself most lacking in sales skills and people/leadership skills to be successful in B or I. A network marketing business would allow me to acquire these skills at a very low cost, and give me a chance to build a business that will put money into my pocket every month!

The problem is, if you want to succeed in network marketing, you need to start by finding a good company! Network marketing has a bad reputation because of its pyramid compensation structure, which reminds people of a pyramid scheme. And it's true! There are a lot of legitimate network marketing company, but at the same time there are also a lot of fraud which their sole purpose is to scam the innocence and grab their money! It is, however, very simple to distinguish a legit network marketing company from a fraud. A pyramid structure is common among businesses. In most business's profit structure, customers always pay the money and the profit moves up the "pyramid" to retailer, up to wholesaler, and up to producer. The bottom of this "pyramid" provides money to their "upline", and the "uplines" earn most of the money. However, this is NOT a pyramid scheme or a ponzi scheme, because there are values flowing back from the top of the pyramid back to the bottom! In general, a legitimate network marketing company provides products of value, and a fraud DOES NOT, hence the fraud is not sustainable, because once there are no new people joining the scheme, the stack of cards collapses on its own weight.

This is a brief introduction on why network marketing could be beneficial for you and why it could be for you! I have found and join a network marketing company and am focused in studying how this business works. Stay tuned and I will share more of things I learn! Who knows, maybe you will find it interesting and want to join the business too!

Questions or comments on business or network marketing? Leave a comment!

What Makes You Rich?

For those of us who are serious about retiring young and retiring rich, it is worth it to remind ourselves constantly what makes people rich.

The constant saying of "If only I make more money..." or "if only I have this much money I could..." prompts us to think that if we have more money, we will be rich.

The truth is, money DOES NOT make you rich! 

We all heard stories of people winning big in lottery, only later in life they became more broke than they were before they won the jackpot. If money makes people rich, then these people who won a fortune of their life should have been rich. But no, not everyone makes it to become rich (of course, with the excessive cash a lot of the people do live a way better life without going broke). So, what makes you rich?

If we define intelligence as the ability to solve problems, then we will easily understand that there are many types of intelligence, because there are many types of problems in this world. For example, you will need very high math intelligence to solve complicated calculus problems. You will be able to communicate your ideas through writing really well if your language intelligence is high. If you want someone who you angered to like you again, you will need to turn to your people intelligence. 

If we look at the problem of "how does a person get rich?", what kind of problem is this? This is a financial problem. To solve this problem, you need financial intelligence!

For instance, if you want to own a $500,000 Ferrari, and currently you have $0, this is a financial problem of  starting at $0 and get $500,000 at the end. I bet that most of us can solve a problem of $0 to $1 (heck, we can grab our hat and beg on the street, or just ask a friend to spare us a dollar), but $0 to $500,000 is another beast. If you cannot solve it, it just means your financial intelligence is not high enough!

So, financial intelligence makes you rich. If you want to be rich, increase your financial 

intelligence! If you haven't known this, I hope this is great news to you, because this means:

1. If money does not make you rich, then it DOES NOT MATTER if you are poor, middle-class, or rich. You can still be rich!
2. It does not matter if you are an A, B or C student in school, since school have never graded you based on your financial intelligence. You can be rich no matter what grades you got in school. In fact, some of the richest people in the world never finished post-secondary!

The next question is, how do you increase your financial intelligence? I think there are 3 basic steps:

1. Find an area to focus on. There are so many different kinds of financial problems in this world. Do you want to start a business? What kind of business? Do you want to start from scratch, or do you want to use an existing system to build your business? What about being an investor? What do you want to invest in? How does real estates sound? What about paper assets like stocks? What about commodities like gold and silver? Does fundamental investing sounds interesting, or technical investing appeals to you? The list goes on and on. Find your passion, and focus on it so you become an expert in that area.
2. Gain knowledge in the area you choose. Information is easily accessible in today's world. Find your hero in the area you are interested to study in, and study what that person says and does. Learn the basics, like the terms used by the players in the area you study in. Play some games if they are available (for instances, if you are into stocks, there are various free stock simulators you can use). Listen to pundits in your area of study and see what they have to say. Talk to others about the subject you study and even teach them what you learn (teaching is a great learning experience). Go shopping. Shopping is free but will allow you to gain more knowledge. Someone who goes to grocery shopping a lot will be able to recognize a good meat deal when one is present. You will also be able to spot good deals quicker and more efficient simply by go shopping more.
3. Take actions and apply your knowledge! Words without actions are cheap! Go beyond your comfort zone, overcome your fear and TAKE ACTIONS. Nothing will increase your financial intelligence more than doing the actual thing and apply what you learn! Of course, you will have MORE OPTIONS in the actions you can take if you have more capital; however, there are things you can do even if you have little to no capital! Ask people in 90% Guardian, as a lot of people started with little capital!
   If you take an action, and if you win, great, you have more money. If you lose, great, you get smarter by learning from your mistakes! If you never step out of your comfort zone and do what you wouldn't do before, you will NEVER increase your financial intelligence. Einstein defined insanity as "doing the same thing over and over expecting different results". If you keep doing the same thing you have been doing, how do you expect anything in you, like your financial intelligence, would change?

I hope we will all remember FINANCIAL INTELLIGENCE is the most important in FINANCIAL SUCCESS, and we shall put this as priority. I hope the 90% Guardian will serve your need in your path to financial intelligence, and you will also share your knowledge to help yourself and others get smarter during the process!