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You see, I really do place a great deal of importance on becoming completely debt-free. Let me remind you that all
Inner Circle Initiates are completely debt-free. Let me also remind you that
the reason for this is as follows:
Every single pound you owe, locks you into working, simply to pay
interest on that pound.
And being an Inner Circle
initiate is all about obtaining freedom - freedom to be whatever it is you want
to be. You cannot be free whilst you
are forced to work for a certain number of hours each week, just to pay interest on your loans.
Paying interest is the pits. I've paid tens
of thousands of pounds in interest during my life. You don't get anything
for this money - you are just paying for the privilege of being a complete
sucker! This, coupled with the overwhelming
feeling of release which comes when you pay off your last debt, is reason
enough to decide, now, to become debt-free.
I want you to experience that incredible feeling of freedom which comes
from being debt-free. I want you to have that terrific rush which comes when you
walk in and pay the last chunk of money to the loan-sharks. It is just like
having a huge weight drop from your shoulders. Suddenly life becomes fun again.
Until you pay off your debts, you will not realise what a burden they have been
to you over the years.
We are trained and brainwashed into thinking that a high level of debt is
normal, even good. If you tell someone that you've paid off your mortgage, they
look at you as though you had just landed from the planet Zarquon! They will
then immediately ask why you have forgone the incredible
tax advantages of being in debt to the tune of £60,000. After all, this is cheap
money!
The answer is that even cheap money is bloody expensive! Okay, you might
be getting tax relief (through the MIRAS scheme),
but you are still paying through the nose for the privilege of borrowing
this money. Add this debt to the crippling
burden of your other debts, and you will find that you are working for many
hours during the week, just to service your debts. By that, I mean pay
the interest on them, not pay them off!
Now then, in previous releases, I asked you to carry out two simple
tasks. One was to destroy all of your credit cards, and the other was to open a
building society account with £50. Have you done these things? If not, why not?
As I mentioned before, you can't get wealthy by sitting around and
reading about it. You have to actually go out and do something about it. In particular, you have to do the things I
tell you to do. I can't force you, of course, but there is little point in you
remaining a member if you are not prepared to follow my advice.
So, if you haven't done so already, please destroy those credit cards,
and open that building society account - today.
A word or two about building society accounts would not go amiss at this
point.
The sole purpose of opening that account is for you to get
into the savings habit. All
wealthy people save. You might say they can afford to, but that would be missing
the point completely! In general, you should aim to save
at least 10% of your earnings. I know that sounds hard. I know you are just
struggling along, but honestly, I never met a single person who couldn't afford
to do this. They thought they couldn't afford to do it, but when you looked at
their outgoings, you find that at least 10% of their money is squandered on
complete and utter junk.
Most of this rubbish is purchased for its comfort value, but let me tell
you there is nothing more comforting than amassing money in a savings account!
It beats buying a load of consumer garbage, hollow!
By starting you off in a modest way I want to get you out of the
sheep-mindset of spend, spend, spend, and into the Initiate mindset of save,
save, save.
You see the sheep have such little power, that the only way they can
cheer-up their drab lives is to spend
money (often borrowed money) on loads of expensive crap. Things like cigarettes,
booze, sweets, treat foods, snacks, fashion-dictated clothes, ‘designer’
labels, new 3-piece suites, camcorders, flat screen digital Nicam stereo TV
sets, Sony stacking CD systems etc. etc. The list is truly endless. They buy all
this junk to comfort themselves, to
shield themselves from the misery of life. They watch T.V. adverts and actually
desire the junk they are being sold! All of this would be fine, of course,
if they were rich, and all this junk cost a tiny fraction of their monthly
income. But the tragedy is that they cannot
afford any of this stuff, and they are buying most of it with borrowed
money, for which they are paying 'loan shark' rates of interest!
This is really amazing, isn't it? I mean it almost sounds like mental
illness - and millions of people are afflicted with this illness.
Does any of this stuff make you happy? Of course not! The pleasure from
stumping-up eight hundred notes for the latest Nicam T.V. lasts for about six
point three minutes! After that you just take the thing for granted, although of
course you are paying for it over the
next year or more!
Let me tell you a little 'inside secret' about truly wealthy people. It
is this: They don't actually spend very much!
Obviously there are a few flash bastards who are the exception, but in
general, the richer you are, the less you spend. Poor people, in contrast, spend lots and lots and
lots of money which they don't have!
Why is this? Are rich people just tight-fisted? Is that how they got
rich, by being miserly? Actually, the answer is no (with a few exceptions, of
course). The reason that most rich people don't spend very much is because: They have learned, the hard way, about the value of
money.
The vast majority of rich
people today, started poor. This didn't used to be true, but it is nowadays. The
era of vast inherited wealth is almost over, and nearly all of those in the top
100 richest people are self-made millionaires. In other words, they started with
nothing, and built a fortune. They all, without exception, became first
debt-free, and then wealthy. And it is this route I want you to follow.
You see, once you stop paying interest to loan-sharks, and start getting
interest yourself on your money, this puts a totally different perspective on
your life. You transform yourself from a loser (and you always
lose when you borrow money) into a winner. And the more dosh you have on
deposit, then the more interest you receive, and the less hours you have to
work. This equals freedom.
Get the idea?
Now building society accounts are not the best place for your money, by
far. I could rabbit on for pages about the best way of investing your £100,000,
and it wouldn't be in a building
society, believe me! But you don't have £100,000 at the moment, do you? So I
won't waste your time on this - yet. But building societies are great places to start
your savings career. They allow you to make small deposits, and they pay a
reasonable (but unexciting) rate of interest. They are also totally secure. As
you accumulate more money, I suggest the following investment strategy: 1. Enough money in the building society to allow for
unforseen emergencies. This is called your 'liquidity'. It is cash you can
withdraw quickly, if things go wrong. 2. A fully paid-up ISA (Individual Savings Account). 3. A Personal
Equity Plan (or Pep). Currently you are allowed to invest £6000 in any tax
year. This is a long term investment
(at least five years) but is very tax-efficient. 4. Thereafter, spare money should be channelled into a
portfolio of stocks and shares, preferably
through a unit trust, as this spreads your risk.
I don't want to go into this in too much depth at the moment, but I want
to tell you that stocks and shares traditionally have done far, far better than 'savings' accounts, like building society
accounts. Typically, £10,000 put into stocks and shares over a ten year period
will do up to eight times
better than the same amount of money left in a building society! But these
are long term investments. You cannot have a 'Post Office Savings Account'
mentality to these types of investments. You must put the money in, and forget
all about it for at least five, preferably ten years.
Anyhow, this is probably all in the future for you. For the moment, I
want to discuss why you are in debt (if you're not
in debt, then this section doesn't apply to you. It might be worth reading,
though). Why
You Are In Debt
There is only one reason why you are in debt. It is the same reason that
anyone gets into debt, and it is simply this: You are in debt because you chose to allow
your outgoings to exceed your income for long enough to get you into debt.
I want you to re-read the above statement three
times in a row until it sinks in. You know, I don't say things just for
effect, and I choose my words very carefully. I also write from
experience.
The above statement is the only reason that anyone gets into debt. There
are no others, and I challenge you to think of one! I can think of a few silly reasons like a
thief at the bank clearing out your entire account, or a hurricane destroying
your house, but I have never met a single person who was in debt for these
reasons - all of which would attract compensation of some sort, in any case.
Now I hit you with the above statement deliberately, and I highlighted
the word 'chose'. Why did I do that? Am I trying to antagonise you? No. An
essential step you must take before you can blast your way out of debt is to stop
blaming other people for your predicament. Even if other people ARE to blame
(and they rarely are), then you must stop blaming them - now.
There is a very good reason for getting out of the blaming habit:
As long as you are continually moaning and groaning about what a lousy
deal you've had out of life, how things always go wrong for you, and how the
world is conspiring against you, then
you have a nice, tidy excuse for sitting around on your bum, and not getting up
and fighting. You can say things like:
"After all, what can I do? I never had a chance, did I? There's no
point in fighting, they'll just knock you down again." Etc., etc. This type
of thinking must be banished immediately.
This is coward-talk worthy only of a
total wimp. Inner Circle members are not wimps! They are warriors who are pitting their power against the 'system' and trying
to win. Any fool can keel-over and die!
You must stand up and fight and take complete responsibility for the mess
you are in.
This is the end of the free preview
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