Finding your money maker is one of the hardest things to do. Today we introduce a new segment called “Lessons on Finding Your Money Maker”. In this segment we will discuss practical ways for you to search out that elusive money maker.
Lesson one is all about tracking the things that you already have that are bringing money in the door. By understanding what you currently have that is making you money, you can put greater emphasis on your current money makers.
The way we are going to do this is by breaking down our current money makers into percentages. I’ve asked one of my co-workers if we can use him as an example. We tracked his money makers for one month. This is what we found:
65% of his money comes from his wage.
8% comes from his commissions and bonuses.
3% comes from the employer match to his 401K contribution.
24% comes from a side project. He has started buying cars and selling them under his uncles car dealership.
Lets break this down. First, his wage is his greatest money maker at this current stage in his life. The goal is for the wage to become a smaller and smaller percentage of your money maker. The reason, if you are like most Americans, your wage is likely paying for all your bills and not leaving much left afterwards.
Next, we have his commissions and bonuses. This is a great opportunity for him to focus on a money maker. If you are lucky enough to have commissions or bonuses at your job, you can ask yourself this question; what do I need to do to increase my commissions and bonuses? This will help you to stay focused on the important things at work and stay away from the time waisting tasks.
For example, my co-worker would routinely answer phone calls from every client. He would then drop whatever he was in the middle of and try to help the client with whatever simple little thing they needed. This sort of distraction would take him away from clients that were ready to bring money in the door that day. The clients that were hot were then pushed to the next day. You can see the trend that would follow. By understanding this, he has decided to send all calls to voice mail. He then checks his voice mail and sorts through them and identifies the ones that are most important. So now the trend has reversed. Clients that are hot are dealt with today and clients that are cold are pushed back until tomorrow. By doing this simple little change, he has entered into his commissions earlier this month than ever before.
Next, we have his employer match for his 401k contributions. He just maxes out whatever the employer is willing to match. In this case 3%. No more, no less. The 3% is free money. He can’t really increase this because he is already maxed out.
Next, we have his side project. At the first of the year, my co-worker decided that his wage alone wasn’t going to be enough to get him to where he wants to be financially. He partnered with his uncle that runs a small car dealership. His uncle would allow him to use all of his resources. In exchange, he would pay a percentage of every sale back to his uncle. Currently, he is averaging one or two sales a month. However, you can see that already he has tapped into a money maker. Even with just a small amount of sales, he is bringing in nearly 1/4 of all his money. Clearly he has an opportunity to focus on this money maker.
This is just a simple example. We didn’t go into his investments, his interest on his savings accounts, or anything in great detail. We simply took a few of his obvious money makers and analyzed them. Even from this simple task, we have outlined two areas where he can put a greater emphasis onto his money makers, his commissions and bonuses and his side project selling cars.
Try this simple exercise yourself and try to single out money makers that you currently have. After you have found your current money makers, start putting more energy and emphasis into them. Remember, your goal should be to minimize the percentage that your wage is bringing in. By doing so, you will see an immediate increase to your net worth.
