The Word “JOB” means “Just Over Broke”:
“He has a job,” or “She has a job,” “I need to find a job”, “I have good job” or “I hate my job.”
I am sure you have heard or used these terms yourself, but do you know it is almost impossible to have a job that will make you wealthy, or even rich? That is you cannot have a job working for anyone else getting paid for a 40 hours per week that will you make you wealthy.
The next time you use or see the word JOB just remember it means; “JUST OVER BROKE.”
Even people who work for mega corporations; Less than 2% of these employees become wealthy working for such corporations. Even for the very, very, few employees who are so lucky to become wealthy, it is not because of trading times for cash. They mostly become wealthy from stock options and grants based on their performance and how well the company stock price does.
However, here is a sure way to start building some wealth, even if you just have a “JOB” no matter how little you earned.
Immediately, start to taking your paycheck and put away 25% each pay period. In 4 years, you will have one year pay saved up. Even better if you put 30 in a fixed, saving, money market account or some other guaranteed non fluctuating investment vehicle.
And the other 70% of (the 25%) into large publicly traded large companies, companies whose products & services millions of people buy and use every day. These companies must pay dividends at least quarterly, and you should make sure the dividends are reinvested to buy additional shares. Keep doing this and in 20 years you will be a lot richer than 95% of your family, friends and neighbors.
The common response I get is; “I need all my money now,” and even though I know this is an excuse, my reply is, “What if your boss came to you and said, ‘Things are very bad I have only two choices: I will have to lay you off or you have to take a 25% pay cut.’”
He/she gives you two days to think about it, and over the two days you look at available jobs and you discovered that they all pay 30% less than you currently earn from your job. You would have no choice, but to take the 25% pay cut.
If you truly want to move ahead financially, you have to learn to live on only 75-80% of your current income, pretend your employer gave you a pay cut and you have no choice, but to live on 75% of you current earning and save the other remaining 25 percent.
The time for action is now, not tomorrow or next week or next month or a year from now. No more excuses. It is time to plan for your future, or you can keep finding excuses and have to be in the “JOB” rat race and end up at old age and broke.
If you chose to take the wise route and leave your excuses behind you, your next step would be to find 21 solid yearly increasingly dividend paying companies to invest your money.
A very good way to find these companies is to ask yourself what are the companies you pay a monthly check to for the use of their services or products, for example, your gas and electric company. Then keep asking yourself, what other services and products, do I and millions of other people buy and use every day such as toothpaste, soap, phone services, and toilet paper, etc.
And as you buy these products weekly, look at the label to see a company that manufactures and distributes these products.
Your next step is to do a search on Yahoo or Google Finance for these companies. Once you find them, the next step is to search to see if they pay at least a quarterly dividends. If no move on to the next company. Once you find a company that is indeed paying at least a quarterly dividends (monthly is better although there are very few companies that pay on a monthly basis), put that company into your shopping cart.
Next check their dividend history. Is the quarterly payment going up over time? If yes, you may just have a winner on your hands. If you see a company that has cut or reduced their dividend payment, unless you have the experience of an Investment guru such as Warren Buffet, Ken Fisher, Petrel Lynch or yours truly, then run away from this one.
The last step is; you should review their Financial Statements such as Balance Sheet, Income Statements and Cash Flow statements to make sure they are financially sound. If you do not know how to read financial statements, you should at least start learn how by doing a quick search on YouTube and you will find many good videos you can watch and learn.
I love reading Cash Flow Statements, just like the name says, it tells you where the cash is flowing through the company. I have one all-time trade secret (that I will never share for free) where I can look at a few numbers on a cash flow statement and within a few minutes, I can tell if the company can sustain paying it quarterly (or monthly) dividends at least for the next 5 years. I prefer a company that can sustain and increase their dividend payment for at least 25 years.
Here are 3 examples based on income: from $25,000- $100,000 per year of an estimated amount of wealth you would have by saving/investing 25% of your income as mentioned.
1) $25,000 per year income:
If you earned $25,000 per year and you save 25% of $25,000 each year you would put away $6,250 and of that amount. Next you would put 30% ($1,875) into a fixed, stable (none fluctuating asset) and the rest ($4,375) you would put into at least you 21, but no more than 35, solid dividend paying stocks as I mentioned.
If you keep doing this for 25 years you will have at least a total of $636,291 ($52,956 in fixed investment + $583,335 and your Dividend paying stock). Using a 1% average rate of return in the fixed /stable investment and a 12% average rate of return on the dividend paying stocks.
2)$55,000 per year income:
If you earned $55,000 per year and you saved 25% of $55,000 each year, you would put away $13,750 of that amount. Next you would put 30% ($4,125) into a fixed, stable (none fluctuating asset) and the rest ($9,625) you would put into at least you 21, but no more than 35, solid dividend paying stocks as I mentioned.
If you keep doing this for 25 years, you will have at least a total of $1,399,842 ($116,503 in fixed investment + $1,283,339 in your dividend paying stock). Using a 1% average rate of return in the fixed /stable investment and a 12% average rate of return on the dividend paying stocks.
3) $100,000 per year income:
If you earned $100,000 per year and you saved 25% of $100,000 each year, you would put away $25,000 and of that amount. Next you would put 30% ($7500) into a fixed, stable (none fluctuating asset) and the rest ($17,500) you would put into at least 21, but no more than 35, solid dividend paying stocks as I mentioned.
If you keep doing this for 25 years, you will have at least a total of $2,545,166 ($211,824 in fixed investment + $2,333,342, in your Dividend paying stock). Using a 1% average rate of return in the fixed /stable investment and a 12% average rate of return on the dividend paying stocks.
As you will see from all three examples, you will have a good investment portfolio at the end of 25 years, you will by no means be wealthy but you will be a lot better off than 95% of most people in the USA and most developed countries in the world.
This is a two parts blog/article the next section will be:
6 ways to become very, very wealthy or even a billionaire!!