What Will You Save When You Cut the Cord?

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Dear Rich Lifer,

The so-called Golden Age of Television started back in the 1950s when TV sets began their explosive growth.

You might remember shows like I Love Lucy, Toast of the Town with host Ed Sullivan, and Gunsmoke.

These classics paved the way for networks to start adding even more content.

In the ‘60s, TV networks started showing full-length movies that had played in theatres. As the supply of movies started to dwindle the networks started producing their own “made-for-TV” movies.

Today, we’re going through another Golden Age of Television. Networks are investing billions of dollars into content creation.

Even large corporations like Amazon have their own movie and TV studios pumping out award-winning hits.

But with so much great TV comes ever increasing, expensive cable bills.

The Wall Street Journal recently cited data from Kagan, S&P Global Market Intelligence noting that the average cable customer pays more than $90 a month plus another $57 a month for high-speed internet.

Compare that to monthly streaming services from Amazon, Netflix and Hulu that tend to run between $9 a month up to $45 a month plus internet. It’s a no brainer.

You can even stream live TV and sports now for less than you pay for cable, plus there’s no commitment. Most services can be cancelled with the push of a button and you’re never tied to any lengthy contracts.

If you’re fed up with soaring cable bills and ridiculous monthly charges, it’s time to take the plunge and cut the cord.

Before I show you how easy it is to ditch your cable company, let’s cover some of the pros and cons first:

Pros of Cutting the Cord

  • The #1 pro is cost savings. You’ll typically save anywhere from $40 to $50 or more per month when you decide to cut the cord. Just think about all the things you could do with an extra $600…
  • Most live streaming services give you access to a free Cloud DVR (no more physical DVR box). This makes “taping” your favorite shows really convenient, which brings us to our last pro…
  • Most streaming services work on any device (laptop, tablet, smartphone, Kindle etc.) connected to the internet, which means you can watch TV anywhere. This is great for anyone who travels a lot, or has multiple residences throughout the year.

Cons of Cutting the Cord

  • Channel flipping can be slow. If you enjoy flipping through channels, you might not get that same satisfaction with streaming live TV or movies. It takes a few steps to change from one platform like Hulu Live to Netflix, Amazon and other streaming services. So if the ability to channel surf is worth an extra $50 a month, then hang 10, dude.
  • You’ll need a device like Roku or the Amazon Fire TV Stick to get streaming services. Unless you have a smart TV, you’ll need to buy a device that plugs into your TV and allows you to stream. The good news is these are cheap ($40-$50 one-time payment).
  • Some live TV streaming services have commercials you can’t fast forward. Hulu Live has a commercial option or commercial-free paid subscription. The commercial option will politely tell you how long ad breaks will last, so you can run to the bathroom or kitchen.

How to Cut the Cord in 5 Easy Steps

If you’re ready to cut the cord, here’s what you do:

  1. Decide if an antenna might work for live TV channels. You can dramatically cut costs by getting an antenna to tune into major broadcast stations like ABC, CBS and NBC as well as PBS. Antennas Direct’s ClearStream Eclipse and Antop’s Paper Thin Smartpass (they each sell for around $35 or $54) are good options for indoor antennas. You might also want to explore mounting an outdoor antenna if you live outside the city.
  2. Choose your internet provider. You probably have internet already, just make sure your internet speed is fast enough to handle multiple devices streaming at once. A good rule of thumb is 5 mbps for every streaming TV.
  3. Pick a device to perform streaming through your TV. Like I said earlier, your main options are Roku, Amazon Fire TV Stick, Chromecast and Apple TV. The first three cost about the same ($50 range), but Apple TV 4K runs a steep $179.
  4. Choose your streaming service for live TV. If you decide the antenna won’t work for live TV or you’re not picking up the programs you want, there are other live TV options. Hulu Live, DirectTV Now, Sling, YouTube TV and PlayStationVue are the most common. They’ll run you between $15 and $45 a month.
  5. Pick your streaming subscription apps. Amazon, Netflix, HBO, Showtime, Starz, Sundance Now, AMC and others offer a wide variety of original content. They all have apps and all you have to do is sign up for a subscription.

The costs of these apps vary widely: Netflix currently charges $8.99 a month for its base streaming plan, while premium channels like HBO run around $15 a month. Most subscriptions offer free trial periods with no commitment, I suggest trying different ones to see what you like.

To Cut the Cord or Not

The biggest mistake you can make is not giving this a try.

Once you take the leap and cancel your cable subscription, you’ll wonder why it took you so long — and if you want cable again, it’s not like your cable provider won’t take you back.

You’ll find that the savings are significant and you’ll have so many more options to choose from for a fraction of what you are currently paying.

You really have nothing to lose and everything to gain here. Cord cutting is not as scary as it sounds. Especially given all the options in this new Golden Age of Television.

To a richer life,

Nilus Mattive

Nilus Mattive

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The Secret to Acing an Interview After 50

This post The Secret to Acing an Interview After 50 appeared first on Daily Reckoning.

  • The biggest stumbling blocks to older workers are…
  • Avoid putting this red flag on your resume…
  • Nothing ages someone more in an interview than…

Dear Rich Lifer,

Finding work in your 50s or 60s is no easy task, but new and somewhat surprising employment data suggests that prospects are improving, especially for older job seekers.

One big reason?

This is the tightest labor market in nearly two decades, causing employers to look beyond the sea of Millennial candidates.

At the end of July, there were nearly 7.3 million unfilled jobs, but only 6.1 million people looking for work, according to the U.S. Department of Labor.

The unemployment rate in July for Americans 55 years and over was 2.7 percent, less than the overall unemployment rate at 3.7 percent.

What’s more encouraging is the average length of unemployment for older job seekers has dropped significantly since 2012.

It’s down from roughly 50 weeks to 34 weeks for job hunters age 55 to 64 and down from about 62 weeks to 30 weeks for those 65+.

In other words, it takes about seven to eight months on average to find a job if you’re over 55.

Stumbling Blocks for Those Over 50

Something I don’t think is given enough attention today are the unique challenges the over-50 crowd faces when looking for work.

Older applicants are competing with tech-savvy Millennials who often come at a cheaper price, and although age discrimination is technically illegal, it’s still pretty hard to enforce.

A study by the Government Accountability Office found five common barriers to employment for older workers:

High salary expectations — You may need to compromise on pay as your skills might not be as up to date as they once were.

Younger bosses — It’s human nature to want to work with people who are like you. If that’s the case, you need to learn how to address this obstacle in an interview.

Out of date skills — Technology is evolving faster than ever. Whether it’s applying for a job online or actually being able to operate new software, the pace can be overwhelming.

Expensive health benefits — The older you get, the more expensive your health premiums become. Bigger companies will be less impacted by this than smaller firms.

Bias — Old habits (and ideas) die hard. Know what biases you’re up against so you can get in front.

Acing the Interview

If it’s been a while since you were actively looking for work, you’ll notice certain aspects of the application and interview process has changed.

My hope today is to give you a few pointers on how to land your next gig, whether you’re coming off a layoff or looking for part-time work as a recent retiree.

If you follow these 10 tips, your inbox should be full of offer letters in the next few months.

Tip 1: Tap Your Network

A major benefit to having been in the workforce for so many years is your network of contacts. Don’t be shy to reach out to old bosses, co-workers, even subordinates.

Let them know you’re on the job hunt. Companies like referrals and it’s a lot easier to get your foot in the door if you know someone.

Tip 2: Get on LinkedIn

A quick way to tap your network is to connect with them on LinkedIn, the popular business-oriented social platform.

If you don’t have a LinkedIn profile, create one now. LinkedIn has become the go-to site for recruiters and hiring managers.

There’s plenty of good advice online that will walk you through how to build an attractive profile that will grab the attention of headhunters.

Bonus: just having a decent LinkedIn profile shows that you’re somewhat tech-savvy helping fight the ‘tech-illiterate’ label.

Tip 3: Update your Wardrobe

This might sound superficial but you need to dress for the job you want, and I don’t mean wearing a C-suite suit.

Your look should appear vibrant and modern. You don’t want to look dated because it’ll make the interviewer think that your skills are dated too.

The goal is to look age-appropriate yet current. Invest in a new suit, a slimmer fitted dress shirt, or a new pair of shoes. If you wear glasses, prioritize getting those updated first. Nothing ages someone more than an out-of-date pair of eyeglasses.

Tip 4: Update your Email Address

If you’re still using an old AOL or Hotmail account, you need to sign up for a newer email service. Get a Gmail or Outlook account to show you’re keeping up with the times.

It probably won’t win you a job, but it definitely won’t raise any red flags during the screening process either.

Also, check out Zoho and iCloud Mail, these are newer email services that’ll show you’re a little more tech-forward.

Tip 5: Modernize Your Resume

First, be sure to keep your resume to two pages max. Even if you’ve had a long and successful career, don’t bother listing every job you’ve held.

A good rule-of-thumb is to go back 10 to 15 years in your work history. This will also help disguise your age a bit should you be unfairly categorized. You can leave off the year you graduated from school, as well.

Be sure to include your LinkedIn profile URL and newly updated email address. If you have a landline, it’s best to leave it off and just use your cellphone.

These are minor details that will show a hiring manager you’re up to date.

Tip 6: Use Experience to Your Advantage

A major advantage you probably have over younger applicants is your experience, make sure you point that out and show how your expertise will help the company.

Don’t just tout your past though. Talk about the future and how you can mentor and groom the next generation of leaders in the company.

Tip 7: Show Adaptability

There’s a notion that older workers are typically going to be set in their ways. This is a common hurdle the over-50 job seeker must face. To fight this stereotype, you need to show that you’re adaptable to change.

When you speak to hiring managers, talk about situations where you adapted to change and the positive outcomes from doing so. Another way to show your flexibility is your willingness to take on temporary, part-time, or project-based work.

Employers understand that young job seekers want full-time jobs with benefits and security for their families. Older workers can fill the void especially for jobs that are seasonal or temporary by nature.

Tip 8: Keep up on Trends in Your Field

An easy way to impress hiring managers is to show that you’ve been keeping up in your field. To do this you can simply read industry newsletters, books, or watch videos online.

There are plenty of online courses you can take for further career development. Udemy, Lynda, and Coursera are all good places to start looking.

Tip 9: Highlight Your Tech Skills

You can’t get around it. In today’s workplace, you need to have a solid understanding of the technology used in your field. Find ways to weave the tech skills you have and are learning into the recruitment process.

For instance: instead of just saying you’re proficient in Excel, give a quick example of how you used Excel to filter large sets of data using pivot tables.

Tip 10: Show You’re High Energy

You want to give the impression that you’re ready to hit the ground running and not simply winding down for retirement. Terms like energetic, fast-paced, and looking for a new challenge are easy ways to liven up your resume.

No doubt, finding work as you get older becomes more challenging.

But that certainly doesn’t mean that you have less to offer than younger candidates. You just have to exert a little more effort to show that in your resume and during the interview process.
Stick to the basics and follow these 10 tips, it’ll help improve your odds of landing a job, or two.

To a richer life,

Nilus Mattive

— Nilus Mattive
Editor, The Rich Life Roadmap

The post The Secret to Acing an Interview After 50 appeared first on Daily Reckoning.

The 7 Money Lessons You Should Already Know

This post The 7 Money Lessons You Should Already Know appeared first on Daily Reckoning.

If wealthy people have the same 24 hours in a day, and work just as hard as others, how do they acquire such incredible wealth?

This was the question George Samuel Clason set out to answer in his timeless classic The Richest Man in Babylon. Since 1926, Clason’s book has sold more than 2 million copies and has been translated into 26 different languages.

Set in ancient Babylon, supposedly the wealthiest city in the history of the world, the book dispenses financial advice through a collection of short stories. The Babylonian financial gurus offer simple and common sense advice to managing your money — advice that’s still relevant today. 

What I like most about this book is the simplicity of the storytelling. Although the book is not religious, the format and diction comes across as “Biblical,” making Clason’s advice seem infallible and sticky in your mind. While none of the lessons are likely to be earth-shattering, they cover the fundamentals of basic wealth building everyone should know.

Going back to the original question: Can wealth creation be taught?

Clason says it can and I have to agree. In the book, Clason tells the story of Arkad, a merchant and the richest man in Babylon. The king of Babylon asks Arkad to share his wisdom with 100 students in an effort to increase the collective wealth of the population.

Most of the people in Babylon are broke, or as Clason calls it, having a “lean purse.” To cure a lean purse, Clason teaches these seven timeless lessons through the story of Arkad:

1st Cure: Start Thy Purse to Fattening.

The streams of income flowing into your life at any given moment can be large. But the balance in your bank account will only grow if you’re disciplined enough to divert portions of those income streams.

Throughout the book, the “enlightened” characters stress saving at least ten percent of your income every month, without fail. Do this by setting aside ten percent before all other expenses are considered.

“But when I began to take out from my purse but nine parts of the ten I put in,” Arkad said, “it began to fatten. So will thine.”

2nd Cure: Control Thy Expenditures.

The amount of money you make is important, but it’s secondary to the degree to which you learn to control your expenses. Clason calls lifestyle inflation one of life’s “unusual truths.”

He writes, That what each of us calls our ‘necessary expenses’ will always grow to equal our incomes unless we protest to the contrary.” You must budget and plan your expenses earnestly. Demand value for the dollars you spend and, “…confuse not the necessary expenses with thy desires.”

3rd Cure: Make Thy Gold Multiply.

Your wealth should extend beyond your income. Make sure all saved monies are kept in the highest-yield interest-bearing accounts available. If you have experience and the know-how, invest a portion of your money in the stock market. Let time and compounding interest go to work for you.

“A man’s wealth is not in the coins he carries in his purse; it is the income he buildeth. That is what thou desireth: an income that continueth to come whether thou work or travel.”

4th Cure: Guard Thy Treasures from Loss.

Forget about the talking heads giving you their “hot tips.” If you’re going to take risks and invest your money, make sure you know how to guard and protect your assets.

Know your risk aversion and understand the risks in your portfolio. Your savings control your future – treat them like it.

“The first sound principle of investment is security for thy principal. The penalty of risk is probable loss. Study carefully, before parting with thy treasure, each assurance that it may be safely reclaimed. Be not misled by thine own desires to make wealth rapidly.”

5th Cure: Make of Thy Dwelling a Profitable Investment.

Clason’s argument is that it makes more sense to make payments that will eventually become equity rather than giving money to a landlord. We don’t need to get into the renting vs. owning debate today.

What’s important here is you should always be looking to build assets and equity with your money. If you don’t know how to invest in rental properties, learn the basics and scale as the equity you build starts paying dividends.

“Thus come many blessings to the man who owneth his own house. And greatly will it reduce his cost of living, making available more of his earnings for pleasures and the gratification of his desires.”

6th Cure: Insure a Future Income.

The future cannot be known, but you can take steps to assure a certain level of financial safety is met. Clason doesn’t really dive into this that much in the book but there are multiple ways you can safeguard your wealth.

Whether it’s a simple savings plan, outside insurance, or a combination of both, you should always be insuring the wellness of yourself and your loved ones later in life.

“No man can afford not to insure a treasure for his old age and the protection of his family, no matter how prosperous his business and investments may be.”

7th Cure: Increase Thy Ability to Earn.

The last “cure” to a lean purse is education. You should be a constant learner, always acquiring new skills, experiences and confidence.

These are the things that will attract more wealth as you become a more valuable asset to your company or business. Consider starting a second, part-time job, or freelancing your skills in your spare time to earn extra income.

“The more of wisdom we know, the more we may earn. The man who seeks to learn more of his craft shall be richly rewarded. Cultivate thy own powers, study and become wiser, become more skillful, and act as to respect thyself.”

At under 100 pages, The Richest Man in Babylon is a quick read. If want a how-to guide, this book is not it.

The advice might seem at times oversimplified, but it’s the same advice you read, rehashed in today’s bestsellers. The truth is the fundamentals to building wealth never change.

To a richer life,

Nilus Mattive

— Nilus Mattive
Editor, The Rich Life Roadmap

The post The 7 Money Lessons You Should Already Know appeared first on Daily Reckoning.

What Does Freedom Mean for You?

This post What Does Freedom Mean for You? appeared first on Daily Reckoning.

Two hundred and forty-three years ago, our Founding Fathers signed the Declaration of Independence, freeing our great nation from the rule of the British Empire.

On July 4th, we acknowledge their courage with celebrations all across the country. 

While you probably associate the fourth now with fireworks, cookouts, and summer mattress sales, I’m willing to bet you still hold freedom as one of your highest values.

But if you’re deeply in debt — or on shaky financial ground — fiscal freedom might seem like another 243 years away.

First, what does monetary independence mean to you?

For some people it’s a retirement number. Maybe $1 million in a 401(k), with your house paid off and expenses less than $1,000 a month. That person is probably more financially free than someone with $3 million in the bank and over $10,000 in monthly expenses. It all depends on your specific circumstances.

To me, monetary freedom is simply not having to base my decisions on financial constraints. You can achieve freedom with more money or less spending. It doesn’t really matter how you get there.

In the spirit of the holiday, I want to share with you four fiscal freedom principles. These should guide you throughout the rest of the year toward your own monetary independence.

Principle #1: Confront Your Spending

American households owe more than $1 trillion in credit card debt, according to the Federal Reserve.

Chalk it up to a lack of discipline to save or a meager salary that’s not enough, so you turn to borrowing to make ends meet.

No matter how you got there, it’s time to add up your debt and confront it — you’re not going to get ahead if you stay in denial.

And just like our forefathers had the courage to imagine a nation of liberty long before it materialized, you need to believe you can get yourself out of debt and stay out.

Starting this July 4th, commit to paying down your debt with a portion of every dollar that comes into your bank account.

Principle #2: Understand Your Investments

Just over half of Americans — 54% — invest in stocks, according to Gallup. While that number may sound decent, it still means there are millions of Americans missing out on their best chance at building real wealth.

Historically, the stock market has been the best place to build wealth over time. But you need to have some basic understanding of how investing works before you start.

As it stands, a lot of investors barely know what they’re invested in. For instance, among investors who own target date funds, the SEC found that only 48% knew that target date funds don’t provide guaranteed income after retirement.

Make sure you know what you’re getting into before you do it. But the bottom line is invest.

Principle #3: Improve Your Credit Score

Your credit score affects so many different areas in your life that you need to figure out how to improve your score.

If you have lousy credit, it impacts the rate you get on car loans, property, and all sorts of large purchases you make. The better your score, the lower your payments will be, and in turn the more money you can save.

Another reason you desperately want to start improving your credit score is because every inflated payment you make means those dollars can’t be invested elsewhere. Payments on large purchases typically last for many years. So, a bad credit score today will impact your lifetime savings dramatically.

Improving your credit score should be at the top of your list after this weekend.

Principle #4: Don’t Give Up

One of our Founding Fathers, Benjamin Franklin, famously said: “A penny saved is a penny earned.” America had to struggle hard for its own independence, but the payoff has been more than 200 years of freedom and prosperity.

If you truly want to achieve fiscal independence one day, it’s going to take some grit and self-discipline. You’re going to have to sacrifice short term pleasure for long term gain. But once you eliminate your debt, and continue saving and investing, you’ll eventually reach your monetary freedom day.

There are no magic shortcuts to wealth accumulation. If you apply the basics found in these four principles, you’ll be celebrating the rest of your life.

To a richer life,

Nilus Mattive

— Nilus Mattive
Editor, The Rich Life Roadmap

The post What Does Freedom Mean for You? appeared first on Daily Reckoning.

7 Timeless Money Lessons

This post 7 Timeless Money Lessons appeared first on Daily Reckoning.

If wealthy people have the same 24 hours in a day, and work just as hard as others, how do they acquire such incredible wealth?

This was the question George Samuel Clason set out to answer in his timeless classic The Richest Man in Babylon. Since 1926, Clason’s book has sold more than 2 million copies and has been translated in 26 different languages.

Set in ancient Babylon, supposedly the wealthiest city in the history of the world, the book dispenses financial advice through a collection of short stories. The Babylonian financial gurus offer simple and common sense advice to managing your money — advice that’s still relevant today. 

What I like most about this book is the simplicity of the storytelling. Although the book is not religious, the format and diction comes across as “Biblical,” making Clason’s advice seem infallible and sticky in your mind. While none of the lessons are likely to be earth-shattering, they cover the fundamentals of basic wealth building everyone should know.

Going back to the original question: Can wealth creation be taught?

Clason says it can and I have to agree. In the book, Clason tells the story of Arkad, a merchant and the richest man in Babylon. The king of Babylon asks Arkad to share his wisdom with 100 students in an effort to increase the collective wealth of the population.

Most of the people in Babylon are broke, or as Clason calls it, having a “lean purse.” To cure a lean purse, Clason teaches these seven timeless lessons through the story of Arkad:

1st Cure: Start Thy Purse to Fattening.

The streams of income flowing into your life at any given moment can be large. But the balance in your bank account will only grow if you’re disciplined enough to divert portions of those income streams.

Throughout the book, the “enlightened” characters stress saving at least ten percent of your income every month, without fail. Do this by setting aside ten percent before all other expenses are considered.

“But when I began to take out from my purse but nine parts of the ten I put in,” Arkad said, “it began to fatten. So will thine.”

2nd Cure: Control Thy Expenditures.

The amount of money you make is important, but it’s secondary to the degree to which you learn to control your expenses. Clason calls lifestyle inflation one of life’s “unusual truths.”

He writes, That what each of us calls our ‘necessary expenses’ will always grow to equal our incomes unless we protest to the contrary.” You must budget and plan your expenses earnestly. Demand value for the dollars you spend and, “…confuse not the necessary expenses with thy desires.”

3rd Cure: Make Thy Gold Multiply.

Your wealth should extend beyond your income. Make sure all saved monies are kept in the highest-yield interest-bearing accounts available. If you have experience and the know-how, invest a portion of your money in the stock market. Let time and compounding interest go to work for you.

“A man’s wealth is not in the coins he carries in his purse; it is the income he buildeth. That is what thou desireth: an income that continueth to come whether thou work or travel.”

4th Cure: Guard Thy Treasures from Loss.

Forget about the talking heads giving you their “hot tips.” If you’re going to take risks and invest your money, make sure you know how to guard and protect your assets.

Know your risk aversion and understand the risks in your portfolio. Your savings control your future – treat them like it.

“The first sound principle of investment is security for thy principal. The penalty of risk is probable loss. Study carefully, before parting with thy treasure, each assurance that it may be safely reclaimed. Be not misled by thine own desires to make wealth rapidly.”

5th Cure: Make of Thy Dwelling a Profitable Investment.

Clason’s argument is that it makes more sense to make payments that will eventually become equity rather than giving money to a landlord. We don’t need to get into the renting vs. owning debate today.

What’s important here is you should always be looking to build assets and equity with your money. If you don’t know how to invest in rental properties, learn the basics and scale as the equity you build starts paying dividends.

“Thus come many blessings to the man who owneth his own house. And greatly will it reduce his cost of living, making available more of his earnings for pleasures and the gratification of his desires.”

6th Cure: Insure a Future Income.

The future cannot be known, but you can take steps to assure a certain level of financial safety is met. Clason doesn’t really dive into this that much in the book but there are multiple ways you can safeguard your wealth.

Whether it’s a simple savings plan, outside insurance, or a combination of both, you should always be insuring the wellness of yourself and your loved ones later in life.

“No man can afford not to insure a treasure for his old age and the protection of his family, no matter how prosperous his business and investments may be.”

7th Cure: Increase Thy Ability to Earn.

The last “cure” to a lean purse is education. You should be a constant learner, always acquiring new skills, experiences and confidence.

These are the things that will attract more wealth as you become a more valuable asset to your company or business. Consider starting a second, part-time job, or freelancing your skills in your spare time to earn extra income.

“The more of wisdom we know, the more we may earn. The man who seeks to learn more of his craft shall be richly rewarded. Cultivate thy own powers, study and become wiser, become more skillful, and act as to respect thyself.”

At under 100 pages, The Richest Man in Babylon is a quick read. If want a how-to guide, this book is not it.

The advice might seem at times oversimplified, but it’s the same advice you read, rehashed in today’s bestsellers. The truth is the fundamentals to building wealth never change.

To a richer life,

Nilus Mattive

— Nilus Mattive
Editor, The Rich Life Roadmap

The post 7 Timeless Money Lessons appeared first on Daily Reckoning.

Why You Should Start Dreaming Differently

This post Why You Should Start Dreaming Differently appeared first on Daily Reckoning.

The world has a love affair with celebrity. Most people spend lots of time and energy keeping up on the lives of their favorite stars, and many idolize them.

It’s understandable. After all, the lives of movie stars seem very glamorous and who wouldn’t want all the stuff they have?

But the reality is that movie stars, rock stars, or even some book authors, for all their glitz and glamour, are just very highly paid employees, though admittedly with a lot of clout. But here’s the deal, if they don’t show up to work, they don’t get paid. Just like a CEO, a lawyer, or any other high paid employee.

As a consequence, they work insane hours and rarely have free time. Not exactly as glitzy as it sounds on the surface.

For someone who wants to move into the B and I side of the quadrant they are motivated by a dream of prosperity and being independent in your financial life. They take classes, buy and read books, spend time studying, then go out and put their new skills to work. They invest time and money now for an expectation of future income…passive income. And it’s not too late to start, find out how you can set yourself up to collect passive income every week.

The Smartest Actor in the Bunch

I find this article I ran across in “Vanity Fair” (“The Highest-Paid Actor of 2018 Didn’t Even Have to Make a Movie”) so fascinating.

According to the article, the highest paid actor in 2018 was George Clooney, but he didn’t even make a movie. So how did he pull that off?

Turns out Clooney is an entrepreneur too.

According to the Forbes World’s Highest-Paid Actor list for 2018, in between social engagements with the royal family, Clooney managed to rake in a career-high pre-tax income of $239 million in between June 1, 2017 and June 1, 2018.

No, he didn’t make any new movies or TV shows in that time—but he did sell his liquor company, Casamigos Tequila, for up to $1 billion. $233 million of Clooney’s $239 million of pre-tax income came from Casamigos; the rest came from endorsements and his older movies.

I’d say that this might make Clooney the smartest actor in the bunch.

Runner Up…

The second highest-paid actor was Dwayne Johnson, also known as The Rock. He made $124 million. To earn that, he had to do three films and a TV show.

As “Vanity Fair” points out, “that guy probably hasn’t slept more than a collective 39 minutes in the past 12 months.” It’s a lot of work, but with a big pay day for sure.

This is an interesting contrast, however. Clooney made almost twice as much as Johnson, while probably working a lot less hours. And it serves as a great example of why being an entrepreneur is always preferable to be a high-paid employee.

Say Hi—Or Bye—to the Tax Man. Your Choice.

Beyond having more time on his hands, Clooney most likely paid a lot less in taxes than Johnson did for his money. As a high paid employee, Johnson has to pay the highest tax rates for his earned income, currently 37%.

Clooney, because he sold a business interest, only had to pay long-term capital gains rates, which equal out to be 15%, more than half of what the earned income rate is.

So not only did Clooney make more money doing less, but he also kept more of it than Johnson did thanks to the tax codes that favor business owners.

Cash Flow Is King

In addition to the sale of his business, Clooney also enjoyed passive income from both endorsements and his older movies. Most likely Johnson did too. The beauty of this is that they make money while they’re sleeping.

As mentioned above, employees, even high-paid ones, have to work or they don’t get paid. By contrast, I can write a book and once it’s published, it makes money for me long after the effort I put into it is over.

The same goes for my business. I put the effort into building it, and now it is run by really talented folks, making money for me even when I’m not working actively on it.

That is the secret that all wealthy people know: cash flow is king.

The Definition of Wealth

I’ve written a lot about it before, but many people think having a lot of money makes you wealthy.

It doesn’t. The only thing that makes you wealthy is if you can stop working and still pay all your expenses. That is the true test of having independence in the financial part of your life.

The beauty of being an entrepreneur is that you can make money work for you, not the other way around. I still do a lot of work on my business, but it’s because I want to, not because I have to. I could, by traditional definition, retire today, not work another hour, and never have to worry about money. That is what I call wealth.

Start Dreaming Differently

I know a lot of people who dream about having a high-paying job. I also know a lot of people who wish they were a famous actor. In both cases, it’s not as great as it seems. You have to work a lot when you get to that level. The money is nice, but it’s only there if you’re showing up each day.

Rather than dream about a high-paying job or a shot at stardom, I’d encourage you to start dreaming differently—and if you have kids, helping them to dream differently as well. I want to challenge you to dream of entrepreneurship.

What could you do today to start moving towards starting your own business and as a consequence, owning your financial future? First, your goal is not to work for more money, your goal is to get your money working for you.

Instead of looking for a better job you are looking for assets that generate passive income. Secondly, with a profession change you are investing time and money to work for someone else. When you invest in your financial IQ you are investing in yourself and your ability to generate income without relying on an employer.

It will be the best decision you’ll ever make. After all, money isn’t everything. Having independence in your financial life is.

Regards,

Robert Kiyosaki

Robert Kiyosaki
Editor, Rich Dad Poor Dad Daily

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