From: “How to become a Millionaire”: The 7 Steps.

Source: Wendy Stevens www.YourMentorForSuccess.com

Added Notes: By Author: Brian Morgan

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7 steps to wealth
Paring it all down, we've come up with seven steps to becoming wealthy.
Remember, wealth is relative, it doesn't necessarily mean "millionaire." The goal
for many people is financial independence, says Stewart Welch of The Welch
Group in Birmingham, Ala.

"That's the point in time when your cash flow from investments is equal to or
greater than your income from work. Look at the statistics: 95 percent of the
population never achieves financial independence. For 65 percent of retirees,
Social Security is their largest source of retirement income."

The No. 1 reason people don't achieve financial independence, says Welch,
is they don't have a written financial plan. So, that is our No. 1 rule for
becoming wealthy.

1. Develop a written financial plan

Saying you want to be wealthy isn't good enough. You need to come up with a
workable plan and put it on paper. The written plan forces you to do something.
Calculate what you need to earn and how to invest. The plan isn't just the
goal; it's the whole thing -- the dream, the goals, the options. The options are
scenario planning -- all the ways you can accomplish that goal -- open a Roth
IRA, contribute to a 401(k).

2. Save, save, save

The end result of your financial plan should be systematic investment. Get in
the habit of saving money. Build an emergency fund in a money market account
so you don't have to raid the rest of your savings and investments when there's
an unexpected major expense. Make it a point to save at least half of every pay
raise.

3. Live below your means

Don't be a walking billboard for overpriced designer clothes, shoes, sunglasses
or jewelry. Don't allow your house or car payments to be budget-busters.
4. Lay off the credit
Some people say that if you can eat it or wear it, don't put it on your credit card.
That's good advice, but take it further. Try not putting anything on your cards
that you can't pay off in two or three months. You need only one or two credit
cards. If you have a fistful, pay them off and cancel them. Remember, debt
holds you back. It reduces cash flow for other things, including investing. If no
one gave you money to borrow, you'd be better off and the economy would be
smaller. If they only let you borrow 75 percent of the value of your home, you'd
be a heck of a lot better off.

5. Make your money work for you

It takes money to make money, but that doesn't mean you need a lot to invest.
Open an account with a mutual fund company that has no-load funds and
low expense ratios. Build a diverse portfolio and you can reasonably expect to
earn 8 percent to 10 percent annually on your investments over the long haul.

6. Start your own business

In the 1996 book The Millionaire Next Door: The Surprising Secrets of America's
Wealthy, the authors state that two-thirds of the millionaires are self-
employed, with 75 percent of them entrepreneurs, and the remainder
professionals such as doctors and accountants. "The idea that most people
inherit wealth is outdated. A lot is built through businesses. Business creation
is the No. 1 driver of wealth in this country," says Zultowski.

7. Get professional advice

A good financial planner can help you fill your portfolio with the right
investments and dump the wrong ones. You don't need to relinquish control,
but you do need to form a good working relationship with someone who has
expertise in this complicated area. "About 76 percent of those surveyed are
actively involved in the day-to-day management of their financial affairs,"
notes Zultowski. "They get involved; they learn about finances, they're not day
traders. They work with advisers but ultimately make their own decisions." If
you can't afford to have a financial planner manage your money, many of them
will review your portfolio and make recommendations for a one-time fee.

Added Research Notes from Brian Morgan / Nov. 2006

1. Develop a written financial plan (double click links)

www.Schwab.com look under “Planning &Retirement”; Schwab offers an article and other
resources to help you calculate how much you need to save each month depending on your
current age and income.
Lincoln Financial Planning Lincoln offers a nice financial planning resource & helps you decide
where you should invest money based also on your current age.
Smart About Money Here is another resource to help you with many articles & other resources
in planning for the future.
A G Edwards & Sons - Retirement Planning Here is another retirement planning resource that
I found to be easy to use and helpful.

2. Save, save, save

By using some of the available resources mentioned above, you should be able to calculate
(using the software on these sites) the amount of money that you need to save each month to
reach the right income levels you need to retire.

3. Live below your means

If you are able to develop a financial plan using the above resources, than this should help you
realize how much you should save each year, which would affect your buying decisions as
you approach retirement. Therefore, with a financial plan in place, you’ll know whether or not
certain purchases are really necessary and if they will fit into your financial plan.

4. Lay off the credit

Credit, especially credit cards, is just another way to over extend what you really should be
saving and investing in. So as the author above says- stay away from your credit cards unless
you do have the cash available to pay them off monthly. If you are paying them (totally) off
each month, then you are really not falling into extensive debt, and you are managing your credit
use wisely. Credit becomes an issue when you are not able to pay these types of account off
each month. If you are indebt with credit, seek professional help and resources to get yourself
out of debt, so you will be able to save this money instead of paying high interest rates on credit.

5. Make your money work for you

Set up your financial plan for the future, and determine exactly how much you should be saving
and investing each month- this makes your money grow while you are getting nearer to
retirement. If you are having problems in knowing what to invest in, then surely get financial
investment advice from a CPA, or certified financial planner. CPA’s generally should be able
to answer many of your investment and savings questions, they are also very well networked
within the community (normally) and will be able to help you seek the right financial planner.

6. Start your own business

For younger people I highly recommend starting a business while they are young. Of course
the indicators show that many businesses fail within 3-5 years, so you should research this
venture very well – including getting free advice from a local SCORE chapter, or Small
Business Development Office, or by doing some networking and talking to a wise business
owner. It’s my guess that buying into an existing business (like a franchise) that is doing very
well might just be much easier than going into a start-up business. Again, the home based
business industry may provide you with some business skills- but I challenge you to really think
seriously about getting involved in a larger real business that has some track record for
success. If you do venture into the start-up business – be sure you have the skills necessary
and also build a management team or advisory team that you will be able to work with so they
can provide their knowledge, skills, and advice during the start-up & business development
processes. Read up on the available literature that shows the risks associated with start-ups
in comparison to already successful business buying.

7. Get professional advice

Unless you have extensive business and investing education behind you, I suggest getting
the advice of a CPA and certified financial planner at the beginning of your financial planning
phase. This will help you develop a more realistic financial plan for you and your family, and
these people will be available for you to consult with whenever your financial or career
situation changes. A very large percentage of people in the USA thought they’d be comfortable in
their retirement years due to working all their lives in a stable company- yet a very high
percentage of these folks are now living solely on Social Security. Follow the advice in the 7
Steps above, make it a serious goal to update your financial plan as your income and perhaps
your careers change – so that you will be able to say that you planned well for retirement –
the key is having this financial plan, seeking advisors to help you, and sticking to your
financial plan. Having a detailed plan is much more concrete and trustworthy than dreaming
about the future. So take these 7 Steps and change your future with them now.

I do hope that this information has been helpful. Do yourself a favor and send it out to your
family, relatives, and friends – I am sure they will thank you for being thoughtful enough to show
them that there are concrete and tangible ways to retire successfully.

Brian Morgan’s Notes:

I worked in the Mortgage and Consumer Small Loan Industry for about 6 years, and had a
chance to really see the average person’s or families’ financial situation. Many of the families had
two incomes, many of them both worked in the same factory, making $50,000 to $100,000 per
year combined. To me that was really rich. Yet they’d come in to a mortgage firm or financial
services firm because they were living paycheck to paycheck. They had extended their credit
by buying the latest cars, clothes, boats, and appliances, and they couldn’t pay their bills
on time. Many had 5 or more credit cards that were maxed to the limits. Most had already
been to their banks to get second mortgages and home equity loans. Yet these people were the
“picture of American’s” that I saw back in the late 1980’s and early 1990’s. What they really
needed was the advice above in Wendy Steven’s 7 Steps. These people had violated all 7 of the
above steps. The main issue was too much credit & living beyond their means.

If anything that I have written is true for you and your family, my suggestion is to take
Wendy’s advise as soon as you can, and start doing so right away. Habits, both good and bad,
can be either started or stopped, my suggestion is to print out the 7 Steps above, and review
them each month for the next 12 months.

I had a Dad, Uncle, and Grand-dad that each owned their own business or was part owner. They
each were very good salesman, managers, and invested well enough to leave a large portion of
assets for their families. So if you are young enough and have the right skill set, I would (if I
was you) definitely look into researching and then buying a business or buying into a
business already doing well. My Dad and Grand-dad bought into companies that they had
been working in for many years. My uncle learned about the recreational vehicle industry while
being a high paid manager, and then left the company with the skills he had learned and started
his own recreational vehicle firm. A well established business that you own will pay much
more than the 8 to 10 percent you can make on the stock market. Yet being entrepreneurial
is not everyone’s skill set.

So business ownership is definitely a way to financial independence. Yet you must do the
research to understand the businesses cash-flow and research into future trends that might affect
the business in the near future.

I have really yet to see anyone in network marketing or in a home based business become
really wealthy. Yet I have run into some mentors of mine that do have residual incomes that top
$50,000 per year, which really is great – understanding that they don’t have to put any work into it
any more. If you happen to be looking for a home based business or network marketing
business understand that it takes a full-time effort to create real income and cash-flow. Many of
the home based businesses, network marketing businesses, and opportunities I see daily
on the internet are full of hype. They use hype to recruit more people, yet I am telling you to
really do some research and homework before you decide on a home business.
What to do before starting a Home Based Business
So I caution you to research the people in those industries and find out
(1) how much they invest in their monthly sales and marketing,
(2) what they really have to accomplish day-to-day to create income,
(3) find out exactly how much money they really make, very important,
(4) get an opinion from either a well established business owner, a well known CPA, or
someone that is really “well off” in their own business before deciding on a home business,
network marketing firm, or other type of start-up business. Research done first will save you
both time and money that may be wasted.

Generating good money with a business normally takes years of preparation in the industry, a
willingness to become entrepreneurial, and also have within the business the best
management team possible. I would estimate that the normal MLM business owner makes $100
per month, that is the average person. The same may be true of home based businesses. I don’t
want to discourage you from these types of businesses; I just am forwarding what I have found to
be true in 20+ years in sales & marketing and also in the MLM Industry. Being in a part-time
Network Marketing Business gave me the skills I never would have gained being an employee, so
the “business skills” you will cultivate & learn are definitely a reason to start a home based
business.

I hope that you found the 7 Steps helpful and that you’ll use them right away.
You may forward this information to anyone you like.

Yours- Brian Morgan: author, researcher, volunteer, investor

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