We are broke, because we are not spending money smartly.
The priority of youth is experiences. We want to do this, and that, and we do not want to miss out on anything that are peers are enjoying. We stretch ourselves to breaking just for one more experience. I am guilty for much of the time that I have been alive, and even seeing this truth, it is so very hard to do what I know to be best for me in the future. Looking back, my biggest regrets are how many times I spent the last of my gas and cash just to go to stupid nightclubs.
I have spent much of my life to learning how to turn $1,000 to $10,000 and $10,000 to $100,000 and then $100,000 to 1,000,000 and so on… rarely do I take the time to realize that for much of my life I have abused $10, limiting my ability to turn that to $100 and then to $1,000 and beyond. Also, the principles to turn $1,000 to $10,000 work the same way for $10.
So here is what I know about $10 and its power. For $10, you can buy a great meal at Burger King – with a Burger with cheese, a deluxe side (like my favorite, sweet potato fries), a drink and a desert. That meal would feed you once. That $10 is spent, and is not coming back. The sustenance from that $10 will last you a limited part of the day, where then you may feel encouraged to eat out again, and spend another $10.
Spend $10 for a long term gain. Buy food that can fill you for several days. Invest in a small bulk of something that you can sell quickly for a profit. Save the $10 and eat at home, so you can use that money better at a later time.
In economics they teach you, the opportunity cost is the choice that is lost.
How many of choices do you loose when you spend money for short-term gain, for instant gratification?
How many people are getting rich because you could not spend your resources wisely?
These are hard questions. Knowledge is power.
I want the power to become the person that sells a million things for a dollar and becomes a millionaire– rather than the person that unwisely squanders a dollar and adds that millionaire’s wealth.
I want my money to work for me, making me more money. How can it, if it is spent without long-term gain?
Everyone wants to get to Heaven, but no one wants to die. I want to be a millionaire, but I don’t really want to sacrifice the comforts of today for the long-term prosperity. That is the hard truth of why we are poor.
Contrary to popular belief, it is really very difficult to move up the latter of wealth in America. But I think I know how to do it. It starts with learning to effectively manage resources for long term gain. It starts with applying that knowledge to $10.
What can $10 buy you for long term gain? How long can you save it, until you HAVE to spend it? This kind of discipline is REALLY, REALLY HARD.
Why is it difficult to manage $10 well? For one, it is somewhat insignificant to us. If you only make $10,000 a year, than $10 is 0.1% of your yearly income, and you will get $10 exactly 1,000 times. Also, $10 does not have a whole lot of buying power in retrospect- making it seem to be even more insignificant.
Another reason it is difficult to manage $10 well, is that when money is scarce, we spend it many times in our minds. I need to make my truck payment, so I will save it. I need gas. I need food. I need entertainment. It is usually the most pressing, immediate need that wins. For me, that is food. Like most of America, I am such a fan of fast food.
In order to be rich from poor, you must do two things to manage resources well. First, do not discount the value of any resource. Second, take care of yourself for the long term, instead of just the short-term so that your resources can go farther and farther.
This may be hard to believe but… You are already rich. You heard a million times in your youth, “Eat all your food- there are starving children in Africa.” We do not have to look hard to find those that have much, much less than we do. We also have opportunities if we are creative enough, to become much more wealthy than we start out.
Once you start to see that you have many great resources, you need to learn how to better apply to last longer. Buy food that will feed you many times. Bring lunch to work instead of eating at the cafeteria. Carpool whenever possible. Live in a place that is the cheapest possible but fits your needs. Find free entertainment, like a jog in the park, or bringing dinner together with friends. Eating with friends can be a great way to stretch resources. Get each person to bring one part of the meal, and make a big meal. Then, later everyone can bring home some of the meal and eat it again. There you have a very inexpensive meal for everyone, and relatively free entertainment of you all getting together. win-win.
You are already rich, and you can get richer. I am going to use a classic example. Let’s say I have two resources. I have Tuesday off, and I have $10. I go to my local Jacksonville, Florida Walmart and buy: this canister of lemonade, which is $2.68 (tax included); these cups for $2.76 (tax included), and this pitcher for $4.24 (tax included). In total, I spent $9.68. I now have the ability to make 256 ounces of lemonade. My cups can hold 9 ounces, but I am going to fill it to about 8 ounces. I can therefore make 32 cups of lemonade. I will make it out of free water from home and sell each cup for $1. I need to sell ten cups to get my money back. If I sell all 32 cups, I will make $32 dollars. That is a 220% increase of my original $10. that is 11/1 as a fraction! If I invested $10 every week, and made it into $32, and saved that $32, I would have $1,664 at the end of the year.
So do not underestimate the value of $10, and be creative in ways to invest your money for long term gain.
Buying a small amount of materials, and then enhancing them, and reselling the finished product is a way to multiply your money.
You could buy wire and beads and make jewelry. You can buy cake mix and sell cakes. You can make cards.
It just takes a little understanding of what people want, how to reach them, how much cost there is to get the materials, and being creative enough to make things that people will buy.
Here are 1oo things you could make yourself.
Making lemonade can also be looked at as wholesaling- Google defines that as Sell (goods) in large quantities at low prices to be retailed by others.
We are talking small, and simple- so here is the small and simple definition. You buy a lot of something. You get a discount on each because you bought a lot. You then sell each at a higher rate than you bought it for.
Here are small ways you can do this.
Concert Tickets. A concert was announced and I saw a lot of demand on social media. The tickets were $10 apiece. I bought ten. I was not going to attend. Three days before the concert, the tickets were completely sold out. I made the announcement that I had tickets. I offered five for $50 apiece. I recuperated my initial investment of $100, in the first two ticket sales, but sold three more, for a profit of $150. Then, the day before the concert, I announced again that I had tickets. I sold five more at $100 dollars apiece, for a profit of $500. I took $100 and turned it into $750 in two weeks. The difference from what I initially invested to what I was left with is a 650% increase!
If you keep an eye open for these opportunities, and you save your money to use when they come up, then you can hop on them fast.
When you buy to sell in bulk, it would help to be small– to keep shipping costs low, rare– to raise price and demand, and non-perishable is a plus- so you do not loose your inventory just because of time.
$10 can buy you lemonade, candy bars, and craft materials
$100 can buy you concert tickets, furniture that you rehab, discount gift cards, and accessories of any kind
$1,000 can buy you camera memory cards, video games, and a print run of your own book, clothing line, informative video that you can sell over and over.
$10,000 can buy you mobile homes, debilitated computers and vehicles to fix up and raffle away, precious coins or metals.
$100,000 can buy you computers or computer parts, vacation bundles, property for development
$1,000,000 can buy you machinery, vehicles, debt paper..
Use your creativity and capitalize on possibilities