Keep
Have you ever read the book Richest Man In Babylon? It’s a great book and I highly recommend it. Once you have completed the book you’ll look back and think, why didn’t I already know this. It isn’t rocket science, but the knowledge in the book is priceless.
I wanted to talk about one idea within the book that has really made an impact on my life. Here is the thought: “A Part Of All You Earn Is Yours To Keep”. Basically this means that when you get a paycheck or any type of earnings you need to pay yourself first. For example lets say you pay yourself 10% of all you earn. You’ll want to take this 10% and put this money to work for you. Re-invest it into possible businesses, stocks or bonds, any type of investment that will create some value to you over time.
I personally prefer re-investing this % into ideas that will provide a passive income for me. Passive income is an income that will pay me each month, without me having to work for it. A lot of people have created a nice passive income in using rental properties, each month when they receive their rent check and subtract the mortgage payment, the extra cash is theirs to put where they please.
I recently found a website that is currently earning me a passive income as well, it’s called Prosper.com. This website has opened up a whole new outlook on financial lending. It’s a consumer to consumer lending service, that cuts out the bank and the higher interest. There are plenty of good people out there looking for a business loan, but don’t want to pay the interest rate. Also there are a lot of people that are tired of paying the high interest rate on the credit cards, so they come to the site consolidate them all into one payment.
I used to put my money in an ING Direct savings account at 4.5%. But now I currently earning back a 14.5% annual return on my money, over a 3 year period of time. The site is an awesome concept, and I am really enjoying help other people out.
