MONEY Master the Game: 7 Simple Steps to Financial Freedom by Tony Robbins
Robbins helps you define and understand your own financial needs and journey, dispels a number of common myths, and provides a large set of tools you can consider to achieve financial success as you define it. Beyond the basic personal finance knowledge, he has interviews with financial titans including Ray Dalio, Charles Schwab, and Burton Malkiel.
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“Compound interest is such a powerful tool that Albert Einstein once called it the most important invention in all of human history.”
Save and invest early in your life. The power of compound interest will do the rest toward helping you secure financial freedom.
Tax deferred accounts
“Conventional logic, as most CPAs will attest, is to maximize your 401(k) (or IRA) contributions for tax purposes because each dollar is deductible. Which simply means you don’t have to pay tax on that dollar today but will defer the tax to a later day. But here is the problem: nobody knows what tax rates are going to be in the future, and therefore you have no idea how much of your money will be left over to actually spend.”
Don’t just follow conventional wisdom about tax-deferred retirement accounts. Your beliefs about the future of taxes should inform your approach to 401(k)s and IRAs.
Measure your finances
“You can’t manage your health if you can’t measure it. And the same goes for your finances.”
If you don’t know how much and where you’re earning, spending, and investing, you won’t be able to appropriately manage your finances.
Cut 3 expenditures
“Write down at least three expenditures you are resolved to eliminate. Calculate how much money this will save you over the course of the next year.”
Instead of trying to solve all of your financial concerns at once, take 10 minutes today and decide on 3 expenditures that you will eliminate in your life. Then stay committed to your word.
Make yourself recession-proof
“If you truly develop skills that are needed in the current marketplace—if you constantly improve and become more valuable—someone will employ you or you’ll employ yourself, regardless of the economy.”
Through both recessions and booms, you will prosper if you develop the skills that are needed in the marketplace.
Don’t time the market
“Timing the market is basically playing poker with the best players in the world who play round the clock with nearly unlimited resources.”
Funds with billions of dollars and advanced technologies are playing in the market every day. If you’re an individual with a dream of competing, direct your dreams elsewhere.
“The more you help others, the more prosperous you will be personally.”
Constantly adding value to other people will not only pay financially in the long run, but it will also pay off spiritually. The most valuable and rewarding way I’ve invested in helping others is through creating scholarship programs for students who represent the qualities or types of people who I’d like to invest in for the future. What’s surprised me over the years is how you can create a scholarship or grant for as little as $500.
“Remember that knowledge is not power, execution is.”
You can read all the best books and listen to all the best podcasts, but until you start taking action on the knowledge you take in, your life won’t change.
Financial stress never goes away
“Financial stress never goes away for people regardless of the level of their wealth or success. Because no matter what stage you’re in, you want to make sure you are using your money most effectively, whether that’s paying for health care and your family’s well-being, or ensuring you are investing your money properly for future generations or to fulfill philanthropic goals.” – Mary Callahan Erdoes
It’s easy to fall into the trap of thinking that a little bit more money will take away your financial stress. But financial stress exists at all levels of wealth, and as you accrue more wealth, you may no longer be concerned with affording your kid’s college tuition, but you have other concerns. So regardless of where you are today, find a way to develop a healthy relationship with money and the stresses it may cause.
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