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Thursday, 02.09.2012 |
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| The Flow of Time and Money |
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| Author:
Lloyd Watts |
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Product Details
Notes
see http://www.lloydwatts.com/ to download the PDF
mostly presents a variation on the Rich Dad principles by Robert Kiyosaki
but uses a simpler "leaky bucket" analogy
six types of financial assets and the passive income they produce:
1) stocks = dividends
2) bonds = yield
3) promissory notes = interest payments
4) real estate = rents
5) intellectual property = royalties, license fees
6) businesses = business cash flow
like Kiyosaki, he says your house is not an asset
buy a small house and invest your extra cash rather than stretching to afford a big house
a unique aspect is the application of the same bucket analogy to time
four types of life assets and the saved time or increased effectiveness they produce:
1) education = knowledge lets you accomplish more in less time
2) relationships = less time arguing, benefit from cooperation and synergy
3) health = greater energy, less down time due to illness
4) organization = less duplication of effort, less time battling crises and correcting errors
Buckminster Fuller, "Approaching the Benign Environment"
"...what we probably mean by 'wealth', really, has something to do with how
many forward days we have arranged for our environment to take care of
us and regenerate us in life and give us increased degrees of freedom."
three stages of wealth creation:
1) survival time - you have savings to last a finite period of time without working
2) personal financial freedom - infinite survival time but not excess income or net worth
3) financial influence - you have enough to influence other people and contribute
ten sources of wealth:
1) inheritance - with longer life spans, you don't get to inherit until it's too late anyway
2) marriage - prenuptial agreements can protect, and your money is shared
3) gambling - pure luck, but statistically you're most likely to lose
4) conservative investing - very slow, but low-risk and low-effort way to save
5) stock market investing - you must understand the market very well
6) incentive stock options at your employer - mostly luck if your company does well
7) real estate - you must learn about tenants, maintenance, and management
8) business ownership - usually need capital to start out, don't work at the job yourself
9) business creation - pull existing ideas to solve a problem, you don't need to invent
10) intellectual property creation - books, music, think like a producer not just an artist
the key to long term success is sustained yet intermittent effort
the process of mastery consists growth spurts followed by slight decline and plateau
with intermittent cycles, you can run multiple paths of mastery simultaneously
this may be what Leonardo Da Vinci did to achieve success in many areas
but don't be a jack of all trades, master of none
while you're pursuing a given task, be completely focused on it, but then take rest
also look for synergy between your different skills, they can complement each other
pay attention when you may have reached your potential on a given path
or when you may no longer be interested in a particular path
Buckminster Fuller complained that we have become a society of specialists
multiple paths of master may help to create a well-rounded lifestyle
seek a role model or qualified teacher, mentors can be a huge advantage
also study the masters, copy their work when you're first beginning to learn faster
look for your higher purpose and have the courage to pursue it |
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