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I got my first monie's. Business tips from Tropical MBA's Dan and Ian.
https://www.johnnyfd.com/2014/05/i-got-my-first-monies-biz-tips-from.html
Ever since I got started with my location independent entrepreneurial journey, I've been a fan of the Lifestyle Business Podcast, now known as the Tropical MBA with Dan and Ian.
This week, they featured my question on their show.
Listen to the episode: TMBA244: “I Got My First Monies, What Should I Do Now?”
More ways to Listen: | Download | Stitcher | iTunes
Here's what I learned:
Lesson 1: Redeploy back into business.
Lesson 2: Disassociate business income from personal
This is a huge problem I have right now. Everything I made from my businesses I have go into my personal bank accounts. The only reason I can get away with this is because I prepay for all of my orders so I never have unexpected bills at the end of the month. I also don't need to reinvest for my current business models as I've never spent more than $600 on any of the businesses I've started.
This week, they featured my question on their show.
Listen to the episode: TMBA244: “I Got My First Monies, What Should I Do Now?”
More ways to Listen: | Download | Stitcher | iTunes
Here's what I learned:
- Redeploy back into business.
- Disassociate business income from personal
- Beating inflation is a waste of time
- 80/20 business portfolio 401k Roth IRA war chest
If you have under $1 million, bet on yourself.
Instead of figuring out ways I can try to get a 10% return on my money through stocks, or investments, I should focus on getting a 100% return by continuing to build my businesses. The only problem with my drop shipping stores is that they don't cost anything to start and I don't need to reinvest any money into them as I don't carry inventory.
What I've learned from this however, is it's a good idea for me to keep my capital liquid in case an opportunity comes up that I do require capital.
Side note: If you're curious about how I got to where I am today, you can read my How I've been Able to Afford my Life of Travel post here. I didn't always have this extra cash problem. In fact, just a year ago I was dead broke.
Lesson 2: Disassociate business income from personal
This is a huge problem I have right now. Everything I made from my businesses I have go into my personal bank accounts. The only reason I can get away with this is because I prepay for all of my orders so I never have unexpected bills at the end of the month. I also don't need to reinvest for my current business models as I've never spent more than $600 on any of the businesses I've started.
What I can learn from this however is it'll be a good idea to start separating personal income from business income regardless.
Lesson 3: Beating inflation is a waste of time
I've actually been worrying about just this. I looked into CD's and savings accounts. But after this episode I realized, it's fine just to have a bunch of cash sitting in my bank for a rainy day.
Lesson 4: 80/20 business portfolio 401k Roth IRA war chest
A few people have recommended a Vanguard ETF funds and getting an IRA so I may look into that as soon as I pull my money out of facebook stocks. FB was basically a gamble, but it's okay as I didn't really need the money anyways and I'm still young. But it would be smart to start betting on the future.
But at the end of the day, the businesses I've built and the knowledge I've gained is worth far more than any investment I've ever made.
Hope you guys got a lot out of the episode and the tips. It has definitely given me something to think about. At the end of the day, I'm just happy that I'm in a position where having too much cash is actually a problem. Just one year ago I never would have thought that would ever be the case!
Warm Regards,
Johnny
In the words of T.I.-"Big things poppin and little shit stoppin!" Congrats on featuring on TMBA podcast!
ReplyDeletehaha I like it, thanks Dex.
DeleteIt's nice having access to cash when you need it instead of having it tied up in investments. Cash is King according to Mark Cuban http://blogmaverick.com/2010/08/25/the-best-investment-advice-you-will-ever-get/
ReplyDeleteI do like Mark Cuban. The final sentence makes total sense: If you have under 100k dollars in liquid assets, your net worth will be higher in one year if you follow this advice than if you follow ANY other investment advice any broker or banker will give you this year.
DeleteWhy don't you start manufacturing your own product? While overhead increases, you will build a brand and asset that you can sell in the future.
ReplyDeleteHey Martin, I've been looking into it actually. The great thing about dropshipping if you can test out markets first to see what people actually buy and then manufacture it yourself. The only thing stopping me from doing it is I don't want to deal with China or physical inventory at this point in life. I'd rather continue to be free for a bit longer before going after the big bucks.
Delete