Your resources to fund your financial freedom are disappearing minute by minute. FACT: You spend a portion of our income every minute of every day. Even when you are at home sleeping, you are spending on the office and the utilities to make that office comfortable. If we have debt, then we are spending on one more minute of interest to carry that debt. The question then becomes “How much income do you REALLY need”?
Finding the EXACT answer to that question is the missing ingredient to achieving your financial freedom. UNDER-estimating the amount of cash flow you need can be fatal to achieving your financial freedom goals. It’s easy to forget the small bits of money that constantly leave your hands and is never added up. A mis-estimation of how much you need to make is the amount that usually ends up on credit cards or lines of credit as debt.
The way to discover the exact level of income you need is best done by figuring out what you are actually spending on a weekly basis, and exactly where that money is going. Take out your Profit & Loss and credit card statements and start reviewing the list, by type of expense, how you spent each dollar during the past 12 months. The more detailed the information, the better. I’ll talk about why in part 3 of this series.
Divide the total of each type of expense by 52 weeks and you’ll have what you spend each week on that expense. Add those up and you’ll know EXACTLY how much income you need each week to fund those combined expenses. That is your break-even budget: the MINIMUM level of weekly income you need just to pay for what you are spending now. Add to that what you need to handle emergencies, expand your business, and build long term wealth, and you get to your real INCOME PLANNING TARGET. When you know exactly how much you need each week to make that Income Planning Target, it raises the necessity to work out how you are going to get in that level of income starting right now. That’s the missing ingredient…knowing your real Income Planning Target…and being willing to do whatever it takes to reach your target to achieve financial freedom.
The missing ingredient – know your Income Planning Target
Know your Income Planning Target &
be willing to do whatever it takes
to gain your financial freedom
Take a look at the immigrants who left their homes, their country and whatever meager assets they had, to start a new life in the United States. They knew they needed substantially more income to guarantee their long-term survival. Their necessity was high enough to take that courageous step of moving to a country without a job, with no place to sleep and not even knowing the language in most cases. They were willing to do whatever it took to better themselves financially. Many said they would amount to nothing. Now those immigrants own the vast majority of the land, the buildings and the businesses in the United States.
It works the same way for an individual, a family or a business. To be effective, planning out the actions of how to raise your income must start with the ingredient of knowing exactly how much income you need to survive, and how much more needs to be made to gain your financial freedom.
Did you have an “Ah-Ha ! Moment” while reading this? Leave a comment and share it.
p.s. For more information about this business money management topic, Claim your FREE Report The Formula To Increase Profits
Read: Gaining Your Financial Freedom (Part 3)
