In Monday’s post, I took a look how Scott – a young family man and doctor – could use his Number/Date to help him evaluate whether to buy his business partner out now or simply wait 30 months, when his partner retires from their medical practice.
Without the ‘filter’ of his Number/Date, this would be a very difficult decision, with so many risk/reward variables …
… but, it’s actually a very simple decision:
Which is the most comfortable (i.e. lowest risk, ‘feel right’) alternative that seems most likely to ‘guarantee’ that your Number/Date – this most critical of life goals – can be achieved?
This is such an important concept that I want to share another example, this time from Trey and Juliana a young couple just starting out on their financial journey together:
Two nights ago I got Trey to work on a life’s purpose. Last night we brainstormed money making ideas: Trey really wants to open a thrift store and we know a perfect location right near the college. Kind of like a Buffalo Exchange, that offers cool music, buying and selling jeans and ultra cool clothing items, shoes , hats and such as well as art and records.
Then we thought of our life purpose and though about making it a Non Profit and helping abused children in some way.
The thought occurred that perhaps as a nonprofit it might be possible to get lower rent, tax breaks, donations and other benefits while helping children. Perhaps we could choose a local children’s or battered woman’s shelter to benefit from our thrift store. There is a lot of research and we will need cash up front.
[Trey is also an artist and has developed] a whole line of B**** B*** Gang which he came up with, (Little cartoon boys) … I think he should license them and sell them. He though of making a comic strip online or illustrating kids books.
I think this would be a better idea than the thrift store because a store ties one down to one spot. However, Trey is really into the thrift store idea.
Another idea is blogging for cash. Perhaps starting 3 separate blogs about separate things such as economical recipes, the battle of the bulge ( weight loss) and one about saving money. I know it would take a while to get subscribers however it does not tie one down the way a store does. I know that this will be time consuming and I will need to do much research as to how one gets paid.
Trey might open a thrift store and I might start a blog or three. It is all about multiple streams of income. I bet I could write children’s books. What if I wrote books and a portion of the proceeds went to fund parenting classes.
For some people, the well of ideas runs dry, but for other – like Juliana [AJC: and me !] – the ideas flow so thick and fast it’s hard to decide where to start …
… so, we often put the shutters up and don’t start at all!
If this is you, I want to share a novel concept: It’s always a good idea to work BACKWARDS …
… here are the steps, as they might apply to Trey and Juliana:
Step 1. Find your Life’s Purpose – They’ve already done this. Check!
Step 2. Choose your Lifestyle – I showed Trey and Julian where to find some great ‘sample lifestyles’ here (click on the links inside that post to see some sample lifestyles at different $$$$ levels).
The idea here is to choose the type of lifestyle that they hope their business/es to fund one day … this will help them immensely (as we’ll see shortly) in choosing the right business!
Step 3. Account for Inflation – This is actually quite easy! Simply double your chosen ‘lifestyle’ amount for every 20 years before you intend to ‘retire’ (i.e. to start living it). If you only intend to wait 10 years, then just add 50% to your annual lifestyle amount.
Step 4. Find your Number – Multiply your final ‘inflated’ lifestyle number by 20: THAT’S your Number!
I left Trey and Juliana some further guidelines on their Life’s Purpose post at the Share Your Number community site.
Step 5. Work Backwards – Now’s the time to decide which opportunities can be sold by their Date for at least the amount of their Number.
Let’s assume their Number is large (right now, it’s $50 Million, but my suspicion is that they will revise this well-downward once they complete the above steps against the filter of their Life’s Purpose).
If it remains a large Number, a blog is unlikely – on its own – to get them there, unless their name is John Chow whose blogs generate about $1,000,000 a year (then again, he does own Technorati.com!).
So, I would advise Trey and Juliana to look at ideas that can expand exponentially, with relatively low capital requirements … here’s a couple of ideas:
Trey’s idea of licensing a cartoon series might have great potential: he could generate interest by starting online (here’s where Juliana’a blog idea CAN help), then hope to get picked up by one of the traditional avenues (e.g. syndication in the news and/or become the next ‘South Park’ cartoon series) supported by product sales and licensing … and, a LOT of luck!
Alternatively, as Debbie suggested, if they can:
a) Successfully create their first Thrift Store and operate it profitably, and
b) Find a unique angle, so that it stands out from similar businesses (not just in this location), and
c) Document all of their operating procedures, such that any ‘dummy’ could run the business just as successfully as they can
… then, they may just have a business that can be franchised.
By working backwards, Trey and Juliana – with a little help of a pencil/paper/calculator or spreadsheet – can decide which of these opportunities is really worth pursuing!
After all, if it can’t help you to reach your Number/Date, why bother? 😉
anyone who makes money on the internet would love to know the secret of John Chow’s success.”**
John Chow is my idol when it comes to online moneymaking~;-
I like the idea of “finding your number.” It gives you a target.
My favorite way to generating passive income is with affiliate marketing.
Affiliate marketing is a doable approach for becoming a millionaire online.
@ The Millionaire Online – LOL. Nice comment/sales pitch … I’ll allow it 🙂
Although, I’d very much doubt that affiliate marketing is an easy way to make a $million and probably an impossible way to make $7 million in 7 years. But, I’m happy to be proven otherwise …