by Eric Huber | Jun 21, 2009 | Helping, Life, Wealth
When I was younger, in my teens, I felt a draw to the arts and entertainment field. Music. Acting. Writing. Art. But everyone around me said, “Go to college and get a job,” even though my soul ached for more.
However, I went to college to get a degree in computer programming, but somehow ended up getting a degree in Art with an emphasis in Commercial Art (i.e. Graphic Design).
My first job? Computer programming AND desktop publishing layout.
It was sort of creative. But all my spare time was spent painting, writing, drawing, and music.
At some point, I stopped the after-hours creative and focused all my efforts on my business I had with two other partners. But the business gave me a lot of opportunity to flex my creativity…in a commercial way…for other people. None of my own visions, but my creations of other people’s visions.
Over the past two years, I have been introduced to a concept that completely floored me, angered me, and gave me hope.
Passive income
Simply put, passive income is money that comes to you without you physically doing the work. That’s not to say you never work, but the ratio of effort/income tips at a point where you spend less effort and the income increases.
I’ll give two examples.
The first is simply a musician or writer who spends time in advance creating their song or book. They then open it up for sale by putting out their CD or novel. That product will keep selling for a long time and continue to bring in money, even if a small amount. An example is that Elvis Presley made $55 million last year, and has been dead for many years. But his music lives on profiting his estate and heirs. Another example is JK Rowling’s Harry Potter books. She wrote for 10 years and now has a net worth of 1 billion dollars! And the sales will continue, and the movie royalties, merchandising, theme park, etc.
The second is creating a product or service that can be sold in a networking method where people bring people into their company, train them to do the same, and move the product. This allows for low start-up costs for a home-based business that is similar to a franchise, but much less initial costs.
Today I heard a story of a couple who had spent years building their network and gradually built a passive income. The husband suffered a stroke and was incapacitated for many weeks. Instead of being concerned about having any money to live on while he was recovering, they had nothing to worry about. In FACT, because they had leveraged their time and effort, the money that came to them actually INCREASED each week as more people joined their network and gave more leverage.
Leverage
“HEY! WHOA! You were talking about Passive Income and NOW you’re talking about LEVERAGE! What’s up with that?”
Leverage is spreading out effort through many people to compress the time it takes to accomplish a goal.
If I had to move 5000 bricks from point A to point B and it was going to take me 20 hours to do it for $1000…I’m making $50/hour (and killin’ my back). But if I hired 5 guys at $20/hour, they’d get the work done in four hours and give me a profit of $600 (minus taxes). They also may have made more than usual AND didn’t kill their backs with only 4 hours of work.
Leverage is an integral part of network based businesses. The most important thing to realize is that you have to do your due diligence in researching the company, it’s products, it’s compensation plan, and the people running it.
Leverage is also important if creating a product or service. I am co-owner of a business that has been developed over a year and a half. It will generate income with a minimal amount of work from us after it is launched. But we put in our time in advance. Additionally, the business will allow others to use it for their own profit saving them time, and we’ll be able to profit as well. A win-win-win (us, them, and their client) scenario.
Additionally, once you have ONE system/product/business running, it becomes easier to start another one. And with a second, and a third, and a fourth business you can offset any ebbs and flows in any given business.
So, what is it you love? Music? Art? Math? Accounting? Massage? What can you do to leverage your time and build passive income?
The whole goal is to stop working, start living, and take control of your life.
I’m Ready to Live!
Contact me if you have questions. There are hundreds of opportunities for people who are ready to take control of their lives, earn some extra money, and build a secure future for themselves and their family. I’ll tell you about one that has already made a substantial difference in thousands of people’s lives. It has also made a difference in several people close to me.
Stay tuned!
P.S. We’ll talk about how to make your money work for you in a future installment.
by Eric Huber | Sep 15, 2008 | Wealth
I am a BIG believer in the company Peak Potentials and am not afraid to share it with anyone. It was amazing. If you haven’t read the book yet, get it!
Don’t HAVE time to read a book and change the way you think about money and wealth? Try an evening seminar.
One thing they preach is PASSIVE INCOME and here are some places to set up accounts to resale your product inexpensively at first and then, eventually, find resources to produce them yourself.
CafePress.com
From t-shirts to books! You design and sell products online. YOU have to market your products, of course, but they have tips there as well
LuLu.com
For books small and full color coffee-table books!
Constant Contact
For eMail newsletters promoting your business, service or product, this site not only has an inexpensive monthly program, but TONS of great articles to help teach you how to make the most effective messages possible.
Commission Junction
by Eric Huber | Sep 9, 2008 | Wealth
In light of today’s headlines regarding the bailout of Fannie Mae and Freddie Mac (and my own experience with trying to buy a home for the second time in two years):
What rescue means for mortgage rates
Bailout of mortgage giants should result in lower mortgage costs and make credit more available.
But lending standards will stay tight and risky borrowers will still pay extra fees.
So…basically, if you’ve got bad credit…you have to pay more?
But how did you get bad credit in the first place?
It always has to do with not paying bills on time and this
- Over extended credit (spending higher than income)
- Poor money management (not paying attention to where your money is going)
- Job Loss
- Unexpected health issues (loss of work + medical costs)
- Change in life (divorce, child, natural disaster, accident)
So, in our “It’s not my fault” society, “the devil made me do it” mentality, we HAVE to take some personal responsibility.
However, while we need to take personal responsibility, it is very obvious that companies have made sure they were able to make plenty of money off the uneducated masses (myself included). In what ways, you ask?
- Mortgage companies gave people loans who’s credit was on the verge
- -fudging numbers
- -using secondary programs
- -encouraging personal loans as ‘gifts’
- Paycheck Advance companies loan money short term at an incredible 350% or MORE!
- Credit Card companies hook you with no interest but add fees and charges and basically can jack the interest up past 28% for the first infraction
- Banks give overdraft ‘insurance’ and charge a fee for bounced checks (yours or someone else who attempts to pay you and fails)
Now…if you pay your bills on time, like you all should, none of this is a problem.
If you ignore all commercials and advertising and avoid needless purchases of the latest video, clothing, shoes, cameras, games, etc. you will not have a problem living within your means and you will pay your bills on time. This will allow you to avoid all late charges, increased interest and give you a wonderful credit score.
Or will it?
Did you know if you DON’T have a credit card, you will NOT build good credit?
Mmmmhmmmm.
Not only that, but if you DO have a credit card and you pay it off every month, that company lists you as a ‘deadbeat’ user. Why? Because they are not making any interest off you at all.
Nice, eh? Some advice gurus say to pay off your balance every month. Others say to keep a 30-40% balance of your total credit line. (shows you are a good little consumer).
And…every time a company checks your credit it affects your credit?
That’s right!
Other things that affect your credit?
- Bankruptcy (duh)…harder to do now, by the way. New laws made recently make it much harder.
- Exceeding your credit limit (careful if you have a annual fee that might take you over the limit AND watch your minimum payment vs. interest if your close to your limit…the interest could push you over…resulting in an over the limit fee.)
- Defaulting on a loan (ESPECIALLY on a home loan. VERY bad for future credit)
- Writing bad checks (harder to do now-a-days, but still possible)
- Persistently late payments (this goes for utilities as well…cut back for a couple of weeks on ‘extras’ and get ahead. The late fees you’ll save ALONE will pay for future ‘extras’ you want.)
- Too many credit cards with large balances
Scared to look at your credit? I was!
But knowledge is power and YOU have the power to start now.
Don’t get frustrated that it may take months or years to recover. Start now!
Did you know you can get a FREE report once a year?
It won’t give you the scores, but it will give you all the reports you need from the three credit reporting agencies:
- Equifax: (1-800-685-1111)
- Experian: (1-888-397-3742)
- TransUnion: (1-800-916-8800)
The National Foundation for Consumer Credit (NFCC) recommends that you check your credit information yearly.
Play the Game!
So, many of you readers have seen photos of the two places I planned to buy over the past year only to be thwarted at the 11th hour.
Was I bitter or angry? Okay..the first time, yes. But what I’ve come to realize is that our society is ever changing and the rules change constantly.
The last home purchase was going on during the latest crisis. I knew problems may arise, but I kept moving forward. In the end, changes in the mortgage industry prevented me from closing on the house with the deal I had arranged with the seller…which was: they paid all closing costs AND they paid 3% in down-payment assistance (an existing program). Zero down for me! Isn’t that what MANY people pitch for home buyers? I was taking advantage of the systems and programs only to be thwarted in the end.
Am I mad this time?
Nah. Just got to learn the new rules and get back in the game.
Two Ways to Fix Your Credit
Get in there and fix it!
Hire someone to fix it for you!
With the Free reports and some time, you can write to the companies, dispute what’s wrong, clear off old stuff and fix your credit. OR…
Do what I did. I hired a company who specializes in cleaning up and monitoring your credit. The one I hired was Vitesse Fiancial. Why?
Well…if you prefer quality time with your family or, like me, have a side business that makes you some money, your time may be worth more than they charge.
Vitesse charges $50/month and likes a one year contract ($600). You have to pull all your credit info together and pay for a credit report every 3 months or so yourself ($35ish), but they do all the organizing, contacting and they know all the tricks to get things cleared off, updated, etc. My sister is the one who pointed me in the right direction and has used them for several months more than me and already her scores have increased. I am a few weeks away from seeing how mine has been affected and will keep you all updated. Here’s a link to their site: www.vitessfinancial.com
HERE’S A THOUGHT: How About Some Reform and Education?
I started writing this blog because I started thinking about how all the companies were screwing us over, but immediately said “TAKE RESPONSIBILITY!”
We ALL want to make money and do more things and life in peace and happiness. Well…most of us do. The bottom line is that some companies and people KNOW they can make money by playing off of people’s desires who have made mistakes and can’t get things easily. However, that traps them into a cycle they can’t escape.
Did you know if you charged a credit card to the max and only made the minimum payment it would take 20 years to pay off the amount? And on some, it never would! Is this bad business? NO! IT’s FREAKIN GENIUS! But would I do it?
Never!
I’d much rather empower people to make more money and spend more money WITH me. NOT be so tapped out that they stiff me later on if they make a mistake.
Face it. Mistakes happen sometimes no matter how diligent we try to be.
Which brings about my last point.
Why not focus on some reform and education! How many people learned in public/private school much more about money besides how to write checks? How many people had parents that focused on finances, budgets, investing and the difference between earning money and creating passive income?
Probably only a small percentage. I hope I’m wrong. But I think I may be on target.
I’ve heard some credit card companies have programs to help teach the proper use of Credit Cards (still allowing for them to profit, but not to loose clients).
I think Sallie Mae and Freddie Mac have programs to teach the importance of credit.
But why not make people take a CLASS before buying their first home? “FREE HOME inspection if you take this class!”
Take a CLASS before getting their first credit card. “No interest for ONE YEAR if you take this class!”
After all, we have to take a drivers test before driving a car.
And how about refresher courses every few years? I just found out about some driving laws I didn’t know existed! Don’t ask me how, but I’ll say it was mandatory (laugh).
All I’m saying is, even though there are plenty of resources out there AND the fact that “Ignorance is no excuse” when it comes to the law, let’s come up with some ways to make SURE people are informed and educated.
More on this topic later.
Now…go check your accounts…don’t be hard on yourself…and figure out what you can cut out for a few weeks to get ahead on ONE bill. Then next month do the same for another.
=)
Namesté Ya’ll
I’m off to check my accounts.
Eric
