How many times a day do you spend money? 5 times, 10 times. Rarely more than that. Think about it. You only spend money a few times a day, yet those few decisions make all the difference between poverty and wealth. A millionaire takes approximately one minute more whenever he spends money than a poor person and that one minute makes a huge difference.
Let’s explore the ‘millionaire’s minute’ and find out why this is so important.
If I could show you a simple one minute exercise that you can apply every time you spend money which would almost guarantee that you would become a millionaire, would you do it?
Let’s examine a typical spending decision. Often average people go shopping in a rush. If they are running late, they quickly snatch up the desired item without comparing prices. While they are waiting in the checkout lane, they pick up a few impulse items and perhaps a magazine to read. As they flick through the magazine, they find something of interest and often it joins the rest of the shopping. When it comes time to pay, they often find they have less cash than they need to cover their purchases so they either pay by credit cards or EFTPOS. They pay for the items but don’t record the event because other people are waiting in the line and besides they’re running late. They rush off a day late and a dollar short. Millionaires on the other hand take a few extra steps that take less than a minute.
First of all before they enter a store, they decide to buy only the items they have planned for and nothing else. Life is full of things to buy. They don’t allow their impulses to derail their decisions or control their life. Then they spend a few extra seconds to compare prices and to pick the best value for money items (this does not necessarily mean the cheapest items). If appropriate they locate a sales clerk and ask if there is a possibility of a discount. They make a quick mental calculation of their savings. This makes them feel good. Then they take the item to the checkout stand. Once again they’re not sidetracked by impulse buying. They select their methods of payment according to their plan: cash, credit card or cheque. They exchange the money for the items, collect their receipt, examine it for accuracy and put it in their purse or wallet for filing later. Then they take the most important step. They record the event by writing down the purchase and classifying it into the appropriate account. They have learnt which items are tax deductible and plan their spending to maximise their tax deductions and credit card reward points. They have developed their financial intelligence by reading, studying, attending seminars and asking questions. They quickly calculate the remaining balance in their account. Later on at home that day they file their receipts in a well-organized manner for easy retrieval.
All told, on average the millionaire spends about an extra minute per transaction than the poor person. But look at the savings in time and money. The millionaire saves from 10% to 20% in comparison-shopping and asking for a discount. What if you could lower your annual spending by 20% without a lot of effort? Then by investing an extra minute to record the transaction and to file it properly, he has at his fingertips a vast source of information. He knows his current account balances, he can compare his spending to previous months and notice trends. He is more aware of his actual spending which gives him greater control of his finances. He can calculate his tax consequences in minutes not days. He can back up his tax decisions with instant documentation. In case of a dispute he knows, how, where and when he spent his money and has the receipt to prove it. He is in control. The resulting peace of mind creates a feeling of power. This increases his confidence, his creativity and judgement. He makes fast, correct and decisive decisions. This gives him that secret millionaire’s advantage.
What about you? What do you do when you go shopping?
In my book,
How To Be Rich & Happy On Your Income I explain the MESS system that you can apply immediately whenever you go shopping:
M stands for “make a list”
E is for “evaluate”
S is for “shop the ads”
S is for “stick to your list”
Making a shopping list is vital because it makes you decide ahead of time what you really need. It helps reduce the temptation to shop on impulse. Identifying your needs before you go shopping allows you to reflect and evaluate so that you are in control. Taking advantage of the special offers and value deals can be a lot of fun and save you money that is then available for other things. If you want to develop millionaire habits then you need to stick to your list and delay your gratification. By doing this you may need to “eat plain biscuits today, in order to enjoy champagne and caviar in the future.”
In the book you’ll also find a section on “60 Ways To Save Money” and many other valuable wealth creation ideas.
About Hans Jakobi
Hans Jakobi is an educator, author and investor. He is the author of six best-selling books including, How To Be Rich & Happy On Your Income which is available at:
www.supersecrets.com and the presenter of the Super Secrets® to Wealth do-it-yourself real estate home study course. Join Hans Jakobi’s FREE Super Secrets® Online Newsletter
© 2002 Hans Jakobi. All rights reserved worldwide
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