Tag: financial advisors

Book Recommendations

Three Ways to Learn How to Own a Business

by Enes ÖnerLeave a Comment on Three Ways to Learn How to Own a Business

Most of the successful business owners have learned to be a business owner by working in companies. This is a form of on the job training. Those who pass family professions on from generation to generation raise their children in the same way. Unfortunately, very few people can get this type of education.

For those who don’t have the chance to work in companies, there are several ways to learn how to own a business.

Management training programs are prepared only to train CEOs. Learning to own a business is something different.

Those who want to have a business firstly follow the path of being self-employed. Most people cannot skip this stage. Because they cannot develop a solid system. So, they become part of a system. Successful business owners have been able to develop systems that operate on their own.

Here are three ways to pass the path and become a business owner:

Finding a Mentor

A mentor is someone who has followed the same paths and has achieved success. Mentor and counselor are different. The counselor tells the client what to do and how. However, they often have no experience in the area they advise. The number of consultants who teach how to be a business owner or investor is quite high. I suggest that you follow the advice of those who have tried and succeeded. If you don’t know someone who owns a business, find and read the biographies, interviews, books or articles of those people. 

You need to learn systems and leadership. Not being a CEO. CEOs may tend to belittle their subordinates, but leaders are aware that they often lead people who are smarter and more talented than them.

I strongly recommend you to read Michael Gerber’s E-Myth Mastery. It’s a unique book to learn the basics of building your own business system.

Probably the traditional way to learn systems is to study undergraduate in economics. In this way, accounting knowledge is acquired and the relationship between company systems and finance is learned. But of course, undergraduate education in the department of economics does not provide business knowledge that will enable to create and build a proper company order.

In order to learn all the systems of a company, it is necessary to work for at least 10-15 years in a large company and learn different aspects of a business. Then you stop being an employee and become a business owner. Working in a company with good systems is like getting paid from your mentor.

Franchising

Another way to learn about systems is to buy franchises. When you buy a business franchise, you are purchasing a system that has been proven to be successful. With a good market research, you can find a lot of very good franchises in the market.

When you purchase franchise instead of setting up your own system, you have more time to train your employees. By purchasing a system, you eliminate one of the uncertainties on the way to own a business. It will also make it easier for banks to lend you money. Normally, they don’t like giving credit to a startup small business. However, banks are aware of the impact of systems on success and know that the risk is reduced when a franchise is purchased.

In order for a business to be sustainable and grow, there must be a harmony in its system. Failure of only one unit leads to crash of the entire system. For example, if the fuel system of an airplane in flight fails, the plane is likely to crash even if everything else is fine. A problem in a person’s circulatory system can cause that person to die, even if all other systems work well. This rule is the same for companies. 

Buying a proven system allows you to learn about unknown or overlooked factors. This is why professional investors tend to support those who will use systems that have proven to work.

Network Marketing

Network marketing is also known as multilevel marketing or pyramid selling. In the beginning, network marketing businesses were deemed illegal as well as franchises. In some countries, those who set up network marketing were penalized. New systems or new ideas may seem strange and suspicious at first.

Many people have been able to build successful network marketing companies. These people have changed the lives and financial situations of many other people thanks to their business. This makes the network marketing system even more valuable. It is possible to become a customer of an established system and starting a business with very reasonable fees. Those who start their businesses thanks to the marketing network don’t suffer from the difficulties of establishing small businesses in traditional ways.

If you’re thinking of starting your own business, you can also check out these posts:

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motivation

Getting Rich More Quickly

by Enes ÖnerLeave a Comment on Getting Rich More Quickly

Study the lives of billionaires who came from nothing. You will find that the reason almost all of them can quickly move to financial freedom is investing or owning a company. Because there is legal convenience for people who earn income in these ways. So, it’s easier for investors or business owners to get rich quick. You can also achieve your financial freedom faster in case your money works for you.

Achieving Financial Freedom

Debts and taxes are two barriers to many people’s financial freedom. To quickly achieve financial security or freedom, it is necessary to own a company or to invest. For this, it is necessary to know that the important thing is not employment security but financial security and financial freedom, and also to understand the difference between them.

The Difference

  1. Employment Security
  2. Financial Security
  3. Financial Freedom

What most people believe is to complete higher education, start a job and retire in that profession. A large segment places emphasis on employment security in this way. They think that employment security is financial security, until they see that they lose their job and cannot find another job. None of them even consider the possibility of losing their job. However, wealthy people do not even speak of the term employment security. They talk about financial security.

Employment Security

People who care about employment security do their jobs very well. Most of them have devoted many years to training and gaining work experience. Although they have retirement plans, they do not know how to invest. They don’t feel safe because they are only trained to work or fulfill their profession.

It’s Always Good to Have Two Legs Instead of One Leg

To get more financial security, you will also need additional income and it will be important to educate yourself to earn those extra income. Whether you are an employee, a company owner or an investor, if you trust your skill, you will naturally feel more secure even if you don’t have much money. Knowledge means power… All you have to do is wait for the right opportunity to use that information and then you will have money anyway.

That’s why we were created with two legs. If we were one-legged, we would always stall, we would not feel safe. A person who is both actively working and investing with his savings is two-legged. Having knowledge on both sides gives us confidence. Those who know nothing but their job or profession are one-legged. Every time the economy goes down, they suffer far more disruptions than two legged ones.

Financial Security

Rather than investing the money in a retirement account and waiting for the highest return, self-taught people to be both employees and investors value financial freedom. I suggest you learn to be a professional investor in the same way we study at school to learn a profession.

The question that the reporter mentioned in the previous post had to ask the investor who earned a million dollars in the asset column but did not pay taxes was actually this:

“How did you get a million dollars?”

This was the main question. It is easy to find legal opportunities to avoid paying taxes. However, earning a million dollars is not easy.

Let’s also take a look at financial security through the eyes of “self-employed” people:

The average American millionaires are self-employed, live frugal, invest long-term.

The path from self-employment to company ownership is followed by big entrepreneurs like Bill Gates. While it is not easy, it is perhaps the best.

Operating in Different Fields

So being educated in more than one field gives more advantages than being well educated in just one. Did you know that wealthy people earn, on average, seventy percent of their earnings from their investments or companies, and the remaining thirty percent as employees or self-employed? No matter how much money you make, knowing how to increase your money will increase your assurance. Financial security is the ability to earn income from both sides independently of each other.

Financial Freedom

This path leads to real financial security, because there is one thing in common between those who earn income as company owners and those who earn as investors: they have people who work for them and make them earn money. Also, they make their money work for them. They work if they want, they don’t work if they don’t. Thanks to their knowledge in two areas, they do not have to work physically.

This is the path the billionaires take. This path shows the revenue models of Bill Gates from Microsoft, Rupert Murdoch from News Corp., Warren Buffett from Berkshire Hathaway, and Ross Perot.

Warning: Owning a company and being an investor are very different. I have seen many successful company owners who have sold their companies for millions of dollars. They like to think that their money is an indicator of how high their intelligence is, so they step into becoming investors and lose everything. A different game is played in each income generation model, different rules apply. Therefore, I strongly recommend that you be informed.

Just like financial security, operating in two areas will provide more stability to the person in the world of financial freedom.

You may want to read: WHICH PATH ARE YOU MORE INCLINED TO? (EMPLOYEE, SELF-EMPLOYED, EMPLOYER OR INVESTOR)

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Financial IQ, investment, motivation

You are the Person to Take Control of Your Investments

by Enes Öner1 Comment on You are the Person to Take Control of Your Investments

Rich people use much more leverage than poor people. If you want to get rich, you need leverage. If you really want to get rich, you need a lot of leverage.

We mentioned about leverage before. Now let’s talk about another thing we need to achieve a better economic situation, control power.

People who earn are careful about their thoughts. They don’t think they can’t. They don’t say “This is too risky.”. They don’t back down by saying “I cannot afford this.” Instead, they ask “How can I do this?” or “How can I reduce my risk?” or “How can I afford this?” People who invest to earn money are also extremely careful when choosing people for financial advice. Just as Olympic athletes should be careful when choosing foods that go into their bodies, investors who invest to earn must be careful with advice that will enter their minds. This process may sometimes involve cleansing your mind from old thoughts.

Control Power

Investors who invest to earn want control as well as leverage. People think investing is risky because they have no control.

Think of a car. A car with steering wheel, brake, accelerator, gear and engine. Just imagine if you could drive without any of these. If you got into a car without a steering wheel, could you drive that car?

Many people think investing is risky because they lack control. Imagine investing in mutual funds, stocks, bonds or savings accounts without any knowledge. When you invest in these tools without being able to answer the questions of what will happen next, how they will be traded, or how they will be affected by price volatility, you have almost no control over them.

Interestingly, most of the people who invest are not trained in this field. Driving a car requires at least a driver’s license to show that the driver has been trained and can drive a car.

The lack of control of uninformed and inexperienced investment advisors, financial planners and stockbrokers also makes things worse. For this reason, they make recommendations “Diversify, diversify, diversify”. Diversification is something you will need when you are out of control. Warren Buffett doesn’t diversify because he’s investing in a controlled manner. It buys either all or most of the shares of a business.

Lack of Control

Most people feel powerless because they have no control over their work. I know many people who lost their jobs not because they were bad employees, but because their companies were sold. More and more people feel like they are losing control, as there are many jobs shifting overseas these days. It is difficult to feel safe when you have little control over your job and salary and invest in assets over which you have no control, such as blind investments in savings accounts, stocks, bonds and mutual funds.

There are three reasons people find it risky to invest.

– They have very little financial education.

– They invest in investment instruments over which they cannot control.

-They get investment advice from salespeople and these salespeople have no control over the investment.

Once you understand the use of leverage, your next task is to make sure you have control.

Control is all about education. The more financially educated we are, the sooner we distinguish between advantageous and unfavorable situations. It is also much easier to sort out the bad ones among the good ideas.

Life is full of risks. We don’t have full control – at least not as much control as we think we have. But by getting educated, making reasonable choices, and having a positive attitude, we can reduce risk. Many people have achieved magnificent successes, even when “fortune is not on their side.” They have won because they have decided to take control of their destiny and refuse to give up.

One of the ways to gain control is to always have the big picture in your mind. When people talk about the big picture, I usually think of a tapestry. If you look from behind an extremely beautiful and invaluable tapestry, all you will see will be many knots. Sometimes it’s all that people can see, because they haven’t seen the completed design on the other side yet.

One of the ways to gain control is to always have the big picture in your mind. When people talk about the big picture, I usually think of a tapestry. If you look from the back at an extremely beautiful and invaluable tapestry, you will only see many tiny knots. Sometimes it’s all that people can see, because they haven’t seen the completed design on the other side yet.

Someone once told me that there are many knots in his life that he could not untie. I quickly realized that his problem was simply that he wasn’t visualizing his own tapestry. He was quite relieved when I told him about it.

Look at the situations from the other side. It will help you gain control and gain insight into how to deal with problems and people. At the very least, you have to be able to control what is going on around you as much as you don’t get stuck with your life being full of knots.

You may not have control over many things, but you can start with yourself. The real leverage is brain power. Winners accept responsibility and retain control.

Review your life today. Can you choose how you spend your day, or are you told how you should spend your day? Do you direct your financial investments or do you leave this business to someone else?

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investment, motivation

You May Lose Money Because You Don’t Invest Enough Time

by Enes Öner1 Comment on You May Lose Money Because You Don’t Invest Enough Time

There are only two things we can invest with: Time and money. Many people lose money because they don’t invest enough time.

Remember the 90/10 rule of money. I can say that 90 percent of the investors invest with money, but don’t invest enough with time. And the 10 percent who earn 90 percent of the money invest more time than money.

Let’s take a look at the diagram of three types of investors below. This is important to understand the relationship between time and investing.

When we look at this simple diagram, it is easy to understand why non-investors and passive investors say “Investing is risky.” They either have little or no financial training, and they have little financial experience.

Most investors consider investing risky and seek financial advice from finance professionals with little financial training or experience.

Did you know these?

• Becoming a licensed massage therapist takes more time than becoming a financial advisor.

• Less than 20% of all stockbrokers and real estate dealers invest in products they recommend to their clients.

• Very few politicians and legislators have any investment.

• Economics department academics generally don’t have a financial training or experience in investment.

• Many journalists who write on finance issues have little financial education or investment experience.

Wall Street is the only place that people ride to in a Rolls Royce to get advice from those who take the subway.

Warren Buffet

It was discovered that the most used word in English is “time”. The word “money” may also be in the top 100, but it wasn’t even near “time” on the list. 

How you spend your time is very important because lost time can never be recovered. The money lost is often recoverable. As Pericles puts it, ” Time is the wisest counselor of all.”. I recommend that you be mindful of your time and learn to invest your time thoughtfully.

If wasting 15 minutes meant losing $ 500, would you be more conscious of how to spend those 15 minutes? I think you would. If you are in the hospitality industry, going to new restaurants doesn’t mean you waste time and money. What waste is, is different for all of us.

Be aware of how you spend your time. Not all money in the world can make up for lost time.

We are all affected by money, regardless of who we are or where we live or what we do. If there is something that will affect your life, it’s best to learn as much about it as possible. Can you find time to invest in your financial education?

Evaluate how you spend your time. There are 168 hours a week:

Can you devote between 4 and 10 hours a week for your financial education? You can probably do that. The real question is: Will you take the time?

Make a promise to yourself to take more time to learn, and then keep your word! Reading this blog is a good start. But more is always needed. What else can you do?

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investment, Taxation

Don’t Be Afraid To Invest Your Money

by Enes Öner2 Comments on Don’t Be Afraid To Invest Your Money

Wealth Is Measured in Time Not Money

“Wealth is the number of days a person can live without physically working and maintaining her standard of living.”

Let’s say your monthly expenses are $ 1000. If you have $ 3000 in your savings account, your wealth means 3 months or 90 days. Wealth is measured in time, not money.

After all, it is not how much money you make, but how much money you can keep and how long you can increase the money. I know many people who make a lot of money every day, but most of their income goes to the spending column.

If their income increases, they consider buying a bigger house or a new car. This means long-term debt and hard work, so nothing is left for the asset column. Money runs out quickly.

“Going in Red” Shortens The Life Of The Engine

To go in red is to continue driving even though the gas gauge drops empty. This phrase is also used to describe going at full speed.

Whether rich or poor, there are many people who always “go in the red”. No matter how much they earn, they quickly spend what they get. “Going in red” shortens the life of the engine.

According to many doctors, the main cause of stress today is hard work and not making enough money. Especially some people insist that “wallet cancer” is the biggest cause of health disorders.

Money Works for You So You Don’t Have To Work

No matter how much money people make, eventually they have to use some of it to invest. Investors are more interested in making money out of money. This is also the idea that money works for you so you don’t have to work. But the important thing here is to know that there are other ways to invest.

Other Ways to Invest

People invest in their education. Traditional education is important because the better you study, the better your chances of making money. If you devote four years to college, you have the potential to earn between $ 24,000 and $ 50,000 a year or more. Considering that an ordinary person actually gives 40 years to work, studying at a four-year university or similar institution can be a very good investment.

Loyalty and diligence are also another means of investment, for example a lifetime working in a private company or a government agency. The reward for this is the retirement bonus and lifetime pension, as well as the right to various services. However, this type of investment, which is valid in the Industrial Age, has lost its validity in the Information Age.

Others invest in a crowded family and want children to take care of them in their old age. Such an investment used to be good, however, due to today’s economic difficulties, families are no longer in a position to meet the living and health expenses of the elders.

There are also independent pension investment plans called individual pension plans. The federal government provides tax relief for incentives to both employers and workers so that they participate in these plans.

Income from Investments

Although all of the above are investment tools, people who invest are more concerned with a continuous source of income than these. Are you currently deriving your income from your investments? In other words, does your money work for you and generate income for you?

Let’s look at someone who buys a house for investment and rents it out. If the rent he receives is more than he has to spend for that house, it means cash coming from investments. The same is true for those who earn interest on their money in the bank or receive dividends from stocks.

Advantage of Earning Income From Investments

The main difference that separates those who make money from their investments from others is to make money from money. If they succeed in this, they can run their money, and the next few generations of members of their family also benefit.

In addition to the obvious advantages of knowing how to earn money from money and live without having to get out of bed in the morning and go to work, there are also tax advantages that are not available to those who work to make money.

One of the reasons the rich get richer is because they earn millions but do not pay taxes on that money. Because their earnings are included in the “active column”, not the “passive column”. Or they make money from their investments, not physical work.

Those who work to make money are not only subject to high taxes. Also, a certain tax is deducted from their wages, that amount goes to tax before they even get it.

Why Are More People Not Being Investors?

Investing means working less, earning more and paying less tax. So why don’t more people become investors? For the same reason as the small number of people starting their own business. In one word, we can say because of “risk”.

Many people are afraid of losing money when they are investing it somewhere. Even if they know how much their investments may earn them, they avoid investing and risking their money because they are afraid of losing.

Fear of losing money divides investors into four classes:

1. Those who avoid risk, love guarantees and keep their money in the bank

2. Those who leave their investment decisions to experts such as financial advisors or mutual fund managers

3. Gamblers

4. Investors

We can distinguish between the gambler and the investor as follows: According to the gambler, investment is a game of chance. For those who hand their money over to someone else to invest, investing is a game that they do not want to learn. It is important for these people to be careful when choosing financial advisors.

It’s Time to Become an Investor!

The defined and predictable plans of the Industrial Age are gone. As the Information Age shifts to specific retirement plans, everyone has to be responsible for their own finances. However, the number of people who realize this is very few.

I urge you to read my WHY YOU NEED TO INCREASE YOUR FINANCIAL IQ post.

If you are interested in investing check out these:

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Debts, economy, Financial Attitudes, investment, Understanding Money

The Difference Between A Good Investor And A Bad Investor

by Enes Öner2 Comments on The Difference Between A Good Investor And A Bad Investor

Many people invest in mutual funds. When I ask someone, who is investing in mutual funds, he answers: “But I am also investing. I have a portfolio of mutual funds. I also have bonds and stocks. Isn’t this all investment?”.

Yes, saving is also an investment. Buying mutual funds, stocks or bonds is also an investment. But it is the kind of investment a saver would make, not an investor.

Let’s take a look at the passive investor philosophy. Most investment advisors provide a recommendation like that:

• Work hard

• Save money

• Get rid of your debt

• Make long-term investments

• Diversify your investments

This is good advice for a certain group of people – suitable for people with a savings philosophy or passive investors. In today’s circumstances, I believe this advice is riskier than any financial advice. It may seem as a reliable and wise advice to those who are financially inexperienced.

There is only one word to distinguish between a saver and an investor. That word is leverage. Thanks to leverage, you have the ability to do more with less.

Many savers do not use financial leverage. And if you don’t have enough financial knowledge or experience to apply leverage, it would be better for you not to use it. I will explain this to you later. Let’s take a look at these standard recommendations from the perspective of the saver and then the investor.

Work Hard

When many people think of “work hard” advice, they only think about their own hard work. The leverage effect on one’s own hard work is very small. Imagine if others will help you to get rich with their hard work. This is the power of leverage. States do not ask us to seek jobs, but to create jobs. If everybody starts looking for work, economies will collapse. For economies to grow, we need people who can create jobs.

Save Money

The problem with saving money is that the current economic system needs borrowers, not savers, to grow. In order for our economic system to continue to grow, it needs smart borrowers. The system does not need people who get poor by borrowing, but people who can borrow money and get rich. While 10 percent of the people who borrow money in the world benefit from their debts to be rich, 90 percent of them become poor with their debts. And this ratio is getting worse every day.

Get Rid of Your Debt

Many savers think that debt is bad and it’s smart to pay off mortgage loans quickly. And for many people, borrowing is bad and getting rid of debt is wise. However, if you are willing to devote some time to your financial education, you can use your debt to move forward. But if you are considering investing with debt, I would like to warn you once again that you should invest in your financial education first.

There is good debt and bad debt. Being financially smart is knowing when to borrow and when to avoid it.

In these economic conditions, savers are losers and borrowers are winners. For whatever reason, you should always be careful when using borrowed money.

Make Long-Term Investments

Look at this advice in terms of sellers: “Give me your money to keep me for years, and I’ll get certain payments from you over the long term.” The phrase “make long-term investments” is like the advantages that allow you to earn points. You become a loyal customer.

Depending on the payments you make to manage the fund, mutual funds may not earn you as much money as other investments.

Diversify Diversify Diversify

Warren Buffet, considered the richest investor in the world, says this about diversification: “Diversification is a safeguard against ignorance. It won’t make much sense if you know what you’re doing. “

Then the question arises: Whose ignorance do you protect yourself from? Is it your own ignorance or the ignorance of your financial advisor?

Diversification generally means that you should not put all the eggs in the same basket. Warren Buffet puts them all in the same basket. He once said: “Put all your eggs in one basket, but watch your basket carefully.”

Personally, I prefer to focus rather than diversify, and actually the reason I was able to move forward was focus, not diversification.

I saw an acrostic on focus in a book I read.

For many, diversification is a good strategy. This is only because it protects investors from themselves and inadequate advisors.

The traditional financial planning advice “work hard, save money, get rid of your debts, make long-term investments and diversify” is good for the average. This advice is also good for those who are rich but are not interested in learning how to become an investor. Many movie stars, wealthy professionals, or former athletes do that. Just remember that while following this path, you will have a very small leverage.

Are you interested in investment? Check out my other posts about investment here.

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