Cardone’s million dollar goal

LIFESTYLE

By THOMAS HUKAHU
IN last week’s article, I shared some tips on how one of the richest men in the world makes his money.
I listed some of the ways Warren Buffet takes care of his money, including being frugal, which means spending very little on things he needed and not unnecessarily wasting it.
In this week’s article, I will share tips from an American who made a million dollars by using a plan and working it over a number of years.
Even though we may not all want to be millionaires, we can learn from him about how to use our money so that we can be able to buy an expensive item, like a car or a banana boat.
The man is a successful businessman and tries to help other people make money by speaking to and motivating them and giving them tips on how to save and make their money work.
His tips come from his YouTube videos. (If you watch his videos, I am sure you will be motivated to be more careful with the use of your money.)

Is becoming rich wrong?
Before I introduce the businessman, let me discuss a thought that some people often express.
Often we hear people talking as if becoming rich or the desire to make money is immoral and therefore the topic is something that many people do not want to spend too much time talking about.
Some even quote the Bible and say that “money is the root of all evil”.
That statement is wrong and taken out of context because money is not the root all evil, it is “the love of money that is the root of all evil”.
Do you see the difference in the two phrases? Yes, it is “the love of money” that is the root of all evil.
That Bible verse is 1 Timothy 6,10 and it reads: “For the love of money is the root of all evil: which while some coveted after, they have erred from the faith, and pierced themselves through with many sorrows.”
There is a warning in that verse in that people who love money can err from the faith and mess up their own lives. That is, when they are without much money, they are faithful to God but when they become rich, they live immoral lives and forget their faith.
But on the other hand, it does not mean that good people should not become wealthy.
I am of the view that a responsible person can become wealthy and still be moral if s/he knows the reason why more money is needed.
The wealth s/he has can then be used to help other people in need, like many philanthropists are doing today. They can also build and support educational institutions and hospitals to serve society.
Some top educational institutions in the world are in operation because rich people, who may have graduated from those schools, continue to support them and in the process they continue to educate more people who may add value to their society in years to come.
Those rich people know that the government cannot do everything, or cannot do everything that is really needed in their part of the world.
Hence, the need to make money is not bad if one has good goals or reasons to do so.
We must also be aware that people who become wealthy in the right way can teach us how to manage our money.
Many of us lack such management skills hence we do not achieve our own financial goals, as in saving K14,000 to buy a banana boat and an engine for our family back in the village.
The successful businessman
Grant Cardone is a successful businessman and today he makes his money from real estate.
From his mid-20s until he was 35, he worked hard and saved money until he had a million dollars in his bank account.
One website describes Cardone as: “… a New York Times bestselling author and an internationally renowned speaker on leadership, real estate investing, entrepreneurship, and finance. His five privately held companies have annual revenues exceeding $100 million. Cardone is a savvy private multifamily investor and holds a portfolio of over 3,800 apartment units.”
His talks on how to deal with and make money should help anyone who wants to be a better manager in using or making money.
The following sections include points he made in two different YouTube videos.
Target of a million dollars
One of the first Cardone videos to gain my attention a few years ago was titled “Five steps to becoming a millionaire”.
In that video, he gave tips to his sales people.
I will not give you the five steps here but I will list some interesting tips that he gave regarding how he made a million dollars.
Tip 1: Do the maths to get your targeted million
“If you make $40,000 a year for the next 25 years, you will make a million dollars. If you make $80,000 a year, you halve the time to 12.5 years,” Cardone says.
(Some people change jobs to get higher-paying ones to reach their target quicker.)
Tip 2: What’s the target?
Some of you have the wrong target. You must have the right target.
And look at your target every day – and work towards it.
Cardone saved money and found more ways of making money to get to his target as fast as he could.
Tip 3: Save 40 percent of your income
If you can save 40 percent of your income, you will become rich. (See the similar tip in the 10 rules in the next section.)
Tip 4: Don’t buy expensive items
When Cardone was 35 years old and had a million dollars in the bank, nobody knew he had that much money in the account.
He lived on very little so that he could save more money. Then he used it to invest in real estate where he made much more money.
The interesting thing about Cardone is that he never borrowed money from a bank to make a million dollars. He made money and saved it year after year until he reached his target of a million dollars.
He also never dipped his hands into his savings account. He only used 20 percent of what he earned from each deal or from his job to sustain himself – the savings account was never touched. (A similar point is made in the next section.)

10 rules to get your money right
In this video, Cardone gives 10 rules that people should follow to be better managers of their money.
Rule 1: Do not spend it until you get it
Do not spend money that you do not have. Which means, do not spend money on a credit (dinau) basis.
Do not count money until the money is in your account. Wait until the money is in before you buy something. Which can be the same as “don’t spend tomorrow’s money”.
Rule 2: The 40 percent rule
Whatever you earn can be divided into three categories – 40 per cent goes for tax (that is, the internal revenue service in USA), 40 per cent goes for you and you live on 20 per cent.
The 40 per cent that you spend on you can include investing in your business with advertising or marketing, while the 20 per cent is what you live on.
Cardone urges his listeners to live within their budget with the 20 percent. People need to discipline themselves and live within their means.
Cardone says “you do not change the 20 until the 20 changes”, as in you making K2000 instead of K1000 and therefore the 20 percent is now K400 and not K200.
He says you have to be disciplined with your money. If you do not take care of your money, it will not take care of you.
Rule 3: If you can’t write it off, don’t buy it
In other words, don’t buy something until you have enough money that can sustain you if it was taken away.
Rule 4: Rent and lease, don’t own
You shouldn’t buy a car or house, rent or lease it, until such time when you can buy your own without jeopardising your financial status, or money you have in your account. (I have heard another successful businessman said this many years ago. They think that buying a house or a car can take a lot out of your bank account, money that you took years to save.)
Rule 5: Stabilise and grow your first flow first
That means, concentrate on one way of making your money instead of trying to start another one.
Creating another means to generate cash flow can take your attention away from growing the flow from what you are already doing.
Rule 6: The 47 rule
If you will put 40 hours in at work, put seven hours for yourself.
Use that seven hours to improve yourself, which should include reading. All the top business people in the world read for hours each day, and that includes Warren Buffet.
Rule 7: Always stay broke
Cash is useless until it is used – until it is put to work.
Use money in that sense and you do not have to keep money.
Money is often called “currency”, and that word comes from “current”, which means it flows. Ensure your money is flowing and doing work.
Rule 8: Never lose money
Be careful with your money – do not be careless and lose it.
Rule 9: You want cash flow, not cash
Like the points made under Rule 7, make your money flow to create more for you.
Rule 10: Never quit until you reach your goals
Never give up until you reach your goals, your financial goals.
That means, you must be determined and persevere until you reach your goals.

Adopt, adapt and improvise
I end this article by saying that as with all advice we get from people, we can adopt their tips as well as adapting and improvising on them.
Some rules may not work very well in certain settings and therefore can be adopted loosely.
For you, some tips from Cardone will help you but you may also learn from other successful people like him and include other rules in addition to what Cardone has given.
But the aim must be for us to be good managers of our money, or company if we want to start a business. Good management tactics and habits are vital in both cases.

Being rich without being wealthy
Let me make one final point.
A rich life does not necessarily mean you becoming wealthy, as in possessing a lot of material stuff. There are a lot of people who do not become wealthy but live very rich and fulfilling lives.
In terms of material things such people are poor, but they are rich in terms of helping other people achieve their goals.
However, all the same, becoming wealthy can help us help many people who are struggling in life.
Next week: Tips from a soldier

l Thomas Hukahu is a freelance writer.