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Monday, June 18, 2007

7 Cures for a Lean Purse

1. "Start thy purse to fattening." - "For every ten coins thou placest within thy purse take out for use but nine. Thy purse will start to fatten at once and its increasing weight will feel good in thy hand and bring satisfaction to thy soul."


There is no Santa Clause, there are no tooth faeries, and a large pile of money is not going to fall in your lap. If you keep ten percent of everything you make for yourself, over time, your purse will begin to fatten. This is largely covered by the first Law of Gold, but is important enough to briefly emphasize again. The only way your purse will fatten is to set aside 10% of all money you make.


2. "Control thy expenditures." - "Budget thy expenses that thou mayest have coins to pay for thy necessities, to pay for thy enjoyments and to gratify thy worthwhile desires without spending more than nine-tenths of thy earnings.

The amount of money a person makes is important, but it is secondary to the degree to which that person controls his expenses. Budget and plan your expenses earnestly. Demand value for the dollars you spend.


3. "Make thy gold multiply." - "Put each coin to laboring that it may reproduce its kind even as flocks of the field and help to bring to thee income, a stream of wealth that shall flow constantly into thy purse."


4. "Guard thy treasures from loss." - "Guard thy treasure from loss by investing only where thy principle is safe, where it may be reclaimed if desirable, and where thou will not fail to collect a fair rental. Consult with wise men. Secure the advice of those experienced in the profitable handling of gold. Let their wisdom
protect thy treasure from unsafe investments."

If you're going to throw any money towards risky investments, do it with the money you have not set aside for debts or savings. If you have money beyond the 10% savings to throw away, and you have no debt to pay off, you should set up another savings account, and pop a percentage into it. Use that for your hot stock tips, or risky investments. Never jeopardize your true savings by loaning it to friends, family, gambling, or risky stocks.

5. "Make of thy dwelling a profitable investment." - "Own thy own home."

A house is arguably one of the best investments one can make. It certainly ranks in the top 3, and you'll still find people arguing to have it in first place. If you spend 10 years in a house, making regular payments on it, you own a good portion of that house. You can sell it, usually for a huge profit. If you live in an apartment for 10 years, you own no part of it. You can't sell it, you can't modify it, and you have gained nothing. A house is every bit as much of an investment as an IRA, stocks, and savings accounts.

6. "Insure a future income." - "Provide for in advance for the needs of thy growing age and the protection of thy family."

You won't have your health forever, and sometimes bad things will happen. Insurance, while sometimes costly, is not a scam. Get insurance. Get home insurance, get car insurance, get health insurance. The savings in health insurance alone are immeasurable later on down the road. aside enough that you can live comfortably off the interest alone. And when you die, your children will have a nest egg to start their own wealth off with. Thus brings us to another point in this: You must teach your kids these rules if the success of your riches is to pass from generation to generation.

7. "Increase thy ability to earn." - "Cultivate thy own powers, to study and become wiser, to become more skilful, to act as to respect thyself."

In time you will be able to look at everything in terms of how much money it can make for you, and since you will have very few money problems, you'll probably have a lot of free time on your hands. If you have a hobby, it can usually be turned into money. Got a passion for art? Start collecting works by talented painters who are old. Got a hankering for golf? Enter competitions. Got some great ideas? Start typing and write a book. You can enjoy life, and even manage to profit off that enjoyment. Our single greatest asset is time, and if you use yours wisely, you will have more money than you will know what to do with.


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