5-takeaways: The 80/20 Principle, Richard Koch

First 5TA for the year! I will be covering this gem that has been staring at me from my bookshelf since I got it almost a year ago. The 80/20 Principle is a book that is based on the Pareto Law, first discovered by Vilfredo Pareto, an Italian economist. Who noticed patterns on wealth and income distributions in nineteenth-century England. Where on average the mathematical relationship between the total population and the total wealth was about 20% of the population held about 80% of the wealth. Pareto’s other finding was that the pattern of 80/20 repeated itself whenever he looked at data referring to a different time or a different country. However, He never fully realized that the principle could be applied to a lot more than just wealth and income distribution. A number of other great thinkers throughout the remaining and next centuries rediscovered and advanced the principle. Richard Koch, a former management consultant, and entrepreneur, just so happens to be the writer that brings the principle to the masses. The book is an easy read and Koch explains the principle well, using relevant examples and giving different ways to utilize the 20% of the effort that translates into 80% of the results in other aspects of business and life. The book is a great read and I hope I can provide a little insight into the principle and how you can utilize it.

  1. 20% causes provide 80% results.

A classic use of the 80/20 principle, is on business clients, 20% of whom provide 80% of the revenue. Most businesses could determine these numbers quite easily. Where are their efforts wasted or not well used on lesser clients that don’t provide enough compensation, let’s say like in terms of they have larger projects in the pipeline. So, in practice out of the remaining 80% of clients that only provide 20% of revenue, and if only half have notable future projects, you could remove 40% of total clientele and then the business would be able to free up time for new clients or double-down on current ones. This also translates into products produced or services provided. 20% of products or services generate 80% of revenue. This is very counterintuitive, you would think that having a variety of products, you would see a relative relationship directly proportional to the amount of items provided.

“The 80/20 Principle states that there is an inbuilt imbalance between causes and results, inputs and outputs, and effort and reward. Typically, causes, inputs or effort divide into two categories:

  • The majority, that have little impact.
  • A small minority, that have a major, dominant impact.”

Of course, this rule of 80/20 doesn’t just apply to business, as I will relate in other takeaways.

  1. 80/20 doesn’t have to equal 100 or is strictly 80/20

This was one of my misguided interpretations when I initially came across the principle. I thought that: a) the sets of data had to equal 100% and b) that the relationship was fixed at 80% to 20%. Koch notes that both of these aren’t integral parts of the principle. 80/20 is just an easy way to name the disproportionate relationship between the causes and the results, the relationship could be 65/35 or 90/1. One such example from the book below.

“One of the most dramatic examples of the 80/20 Principle at work is with movies. Two economists made a study of the revenues ad lifespans of 300 movies released over an 18-month period. They found that four movies – just 1.3 percent of the total – earned 80 percent of box office revenues.”

Koch notes that one limitation of the 80/20 Principle is that it is only a snapshot of the time when the data was collected. However, Koch does relate the 80/20 Principle to Chaos Theory, which states that outcomes are based on ’sensitive dependence on initial conditions’. So the chance that the first company to the market is going to be the biggest at a later date is massive compared to a new-comer. Not only will larger companies hold most of the market value, but they will also gain more and more of the market. A great example is Coca-Cola, one of the first to the market, and now holds 48.6% of the market share, imagine that one company owns almost half of the market. Let’s say that there are 100 cola companies total, that’s a 49/1, this stat is neither is 80/20, nor does it equal 100%, yet it is significantly skewed.

  1. 80/20 your Money.

Typically, 80% of your wealth will come from a small percentage of your activities. For myself, 100% of my money comes from one activity, my job. Similarly, if you look at someone like Warrant Buffett, most of his wealth comes from a small part of his investments, I would hazard a guess that’s its stocks. Speaking of stocks, we can use our new-found knowledge on it. Koch has some wise words on wealth, “You are more likely to become wealthy, or to obtain the greatest increase in wealth, from investment income rather than from employment income.” So, what should you do with most of your money? Around 20% of your money (of course this can be more or less depending on your personal & financial situations)? Save and invest.  And of that 20%, most of it should be put into long term investments, otherwise known as blue-chip shares, a good place to park the money is in an index fund. Koch describes what compound interest is, how it works and why you should use it to your advantage. I won’t go into it as it needs another post of its own, I can suggest looking it up, or playing around with some values on a compound interest calculator(which can be found here.

  1. 80/20 your Time and the rest.

Do you ever feel like you waste a lot of your day away? I know I do, whether I get sucked into social media browsing, or a youtube/Netflix binge, or doing things I don’t feel are productive or things that I don’t enjoy. Now, some things are very necessary, such as work and sleep, these will take up more of your time. But the rest of your time can be 80/20’ed. There are 168 hours in a week if we say that you work a 40hour week, and sleep for 8 hours a day, you are left with 72 hours, if you factor in travel to and from work and eating we’ll say that your left with 50 hours (being conservative). Of these 50 hours, you may only really enjoy doing 20% of the things that you do, or 20% of the people you see. So to get more out of your time break down what goals you want and, track your time and see where you are losing it. There are many ways to do this and find one that works for you, I often use a technique called time blocking, which I wrote about here. Once you’ve done that go out and achieve those goals. See more of the friends or family members you want to see, or you could optimize your time to learn a new skill, start a business or a blog, get to the gym more. Of course, all of these things will lean toward something that you enjoy. You could 80/20 your spare time for happiness if you so desire. You might even go so far as removing work altogether (not advised if you have another way to bring in money) or finding work that you enjoy (recommended).

  1. Change your mode of thinking.

Koch really does get into how effective the 80/20 principle is outside of finance and business, once the basics are understood and the reader can start thinking with the imbalanced required. This was maybe a bit easier for me as I had already been introduced to this mode of thinking by the likes of Tim Ferriss and Gary Keller. I had been meaning to get the knowledge from the source, and this is my biggest takeaway. The universe and the world is not fair and most likely never will be, things will always improve, but the balance of 80/20 will remain. Instead of worrying about how life isn’t fair and you feel downtrodden, try and make your own life 80/20, try and break out of the social norms that you have grown accustomed to. Instead of thinking about things in the standard direct cause and effect way, start to think 80/20, as Koch describes below:

“To engage in  80/20 thinking, we must constantly ask ourselves: what is the 20 percent that is leading to 80 percent? We must never assume that we automatically know what the answer is, but take some time to think creatively about it. What are the vital few inputs or causes, as opposed to the trivial many?”

Change is hard, going into the unknown is difficult, but with discipline, you can develop a habit, and with time the habit will become a lifestyle choice. I am trying to make 80/20 a lifestyle choice, I would love if you could join me.

Koch has produced a gem of a book, that has inspired many who use it for their own businesses and personal lives. The 80/20 principle teaches its readers that 50/50 is incredibly rare, often if you can figure out what the small minority that has a huge impact is, you will be able to maximize your time, money, and happiness towards achieving your goals and life visions. As usual, I will leave you with a powerful quote from the book.

“The greatest thing about the 80/20 principle is that you do not need to wait for everyone else. You can start to practice it in your professional and personal life. You can take your own small fragments of greatest achievement, happiness, and service to others and make them a much larger part of your life… You can become a better, more useful and happier human being. And you can help others to do the same.”

Thanks for reading.

See you on the mats.

-Carlos

Why the change?

I have recently changed the name of the site to carlosygoa.com since I felt that readnroll.blog limited me in what I could and could not post about, I am in no way shape or form moving away from what I have been doing. This is just an update about the change. I Hope that you all understand.

Thanks

Carlos

5-takeaways: The 22 Immutable Laws of Marketing, Al Ries and Jack Trout

With over 40 years of marketing expertise between them, Al Ries and Jack Trout have produced the 22 Immutable Laws of Marketing. For any person or business wanting to sell a product or service give this little book a read, it will pay dividends. There is a multitude of historical examples of marketing going right and it going very wrong, the examples provided are over 20 years old but still help prove Ries and Trout’s unchangeable laws that govern marketing. Here are my takeaways from this little book.

  1. Be first, either in a new category or in the consumer’s mind.

If you are trying to provide a service or product being first is the most important part. Of course, if you can’t be the first you, to succeed you must either create a new category or make it that you are the first in the minds of the consumer. Being the first in the mind usually goes to the first in the marketplace, however, if you can’t make a person perceive you as the company with the best product or service it is much harder to change that opinion. Apple wasn’t the first to the computer marketplace, or mobile phone, for that matter. Why is it one of the largest companies in both fields, well simply, it’s the first thing that people associate to either category. It’s easier to remember the first position holder than it is to remember the second or third. Who’s the second fastest man on earth currently? To be honest I’m not sure. If you can own the first spot either in the category or the mind, then the success of you/the company becomes much easier.

  1. Be focused.

By focusing on one thing, for example, you might own a company that specializes in one thing like engineering. And everyone knows that your company is the top in your field, everyone comes to you for all their engineering needs, as Reis and Trout put it, engineering is “your word”. You start to grow with your success, so you decide to branch out into other fields, let’s say like construction, but there is already a great construction company. So, since you know that you must be first in the client’s mind for construction you spend millions on advertising to try to compete with the competition. However, since you are already associated with being great engineers the could-be-clients don’t recognize you as a great construction company, so no matter how much you spend on advertising your company will never make it into the first spot.

“This was the case with Atari, which owned the words video game. But the business turned out to be faddish – (foresight is 20×20)-, so in 1982 it sailed off in a new direction. It wanted Atari to mean computers. CEO James Morgan laid it all out: “Atari’s strength as a name also tends to be its weakness. It is synonymous with video games. Atari must redefine its image and broaden its business definition to electronic consumer products.”

Of course, we all now know how that played out. Not too great for Atari, if only they focused more on their One Thing, Video Games, then the world of gaming might look incredibly different. Atari’s problem stems from the next point.

  1. Remove your ego.

As we see in the example above Atari’s success went to their heads, and instead of committing to their long-term success, they went to chase the short-term gain. They felt that with their already famous name they could branch out into another category that at the time was already owned by IBM a giant in the computer industry.

“Ego is the enemy of successful marketing.”

Ego causes more problems in all aspects of life than it does correct them. The same can be applied to marketing. You may think that from previous success that you will be able to branch out into another field, this could not be further from the truth. Some companies can do it, such as Apple, however, their words aren’t computers, phones or tablets, its innovation. Because everyone associates them with innovation it allows them to break out into new categories, and as long as they are innovating then they will succeed.

  1. Keep it simple.

“Apple’s problem in getting into its prospects’ minds was helped by its simple, easy-to-remember name. On the other hand, Apple’s competitors had complicated names that were difficult to remember. In the early days, five personal computers were in position on the launching pad: Apple II, Commodore Pet, IMSAI 8080, MITS Altair 8800, and Radio Shack TRS-80. Ask yourself, which name is the simplest and easiest to remember?”

If you are going to market something, don’t make your job any harder than it needs to be. Keep it simple, for example, Apple – “Think Different”, McDonald’s – “I’m Lovin’ It”, Woolworths – “The Fresh Food People”. The list goes on. Simple product, simple slogan, simple marketing, the easier it is to remember the higher chance of getting into and staying in the minds of the consumer. Of course, to keep it simple you must…

  1. Make some sort of sacrifice, to get the things you want.

This ties in with point No.2, Not only must you focus but you must give something up. This not only relates to marketing, but to life. If you want to spend more time with your loved ones, or you want to post more on your blog, you must give something up. I know that I have lapsed on posting regularly recently, I have not prioritized my time well and I have turned my focus to other things, starting a new job being one thing. Sacrifices can be conscious decisions, however, a vast majority of people and companies let their circumstances dictate their attention. If you really want something you must make some sort of sacrifice. Time, money, other products, sleep, food or other hobbies. You want to have a successful product but want to chase other short-term trends to get quick profit, you will lose long-term. You want to become better at jiu-jitsu but also want to spend time at the gym, choose one over the other, or create time for both by making sacrifices in other areas.

These are only my thoughts on the book, I am no marketing expert or claim to have used these laws yet. I recommend anyone in a business of any sort to give it a read as you will benefit from it, either to improve on your product or service and your current marketing strategies. This is only a quick one, hope you enjoyed it.

Thanks for reading.

See you on the mats.

Book Review: The One Thing, Gary Keller with Jay Papasan

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Having recently found an interest in extraordinary successes and results I decided to pick up The One Thing, by Gary Keller with Jay Papasan, as my next book review. Gary Keller is an American entrepreneur and best-selling author, he is most known for his work as the founder of Keller Williams which is the largest real estate company in the world, with over 180000 agents, and franchises in North America, South Africa, Germany, Austria, Switzerland, Turkey, the UK, and Dubai. He has co-authored two previous books, The Millionaire Real Estate Agent and The Millionaire Real Estate Investor, the latter becoming a New York Times best-seller. So, it’s fair to say that Keller knows a bit about extraordinary success.

A Russian proverb starts the book, “If you chase two rabbits, you will not catch either one.” This sets up the book which holds the view that as Humans we can only focus on one thing at a time if we want that one thing to be successful. He backs this up with a passage from the movie City Slickers, where the following conversations take place between two characters:

Curly: “Do you know what the secret of life is?”

Mitch: “No. What?”

Curly: “This.” [He holds up one finger]

Mitch: “Your Finger?”

Curly: “One thing. Just one thing. You stick to that and everything else don’t mean shit.”

Mitch: “That’s great, but what’s the “one thing”?”

Curly: “That’s what you’ve got to figure out.”

Keller goes on to say that at the time he didn’t realize the importance of this conversation. His company had run into some problems, after almost a decade of successfully building it from the ground up they had hit a wall. After going to a coach who helped him through his predicament they had come to the conclusion that Keller needed to fill 14 positions that needed new faces. Keller seeing that the most important thing to keep the business going was to find the people to fill those roles, he fired himself as the CEO. He made it his mission to focus on his one thing. Once the roles started being filled, the company grew year on year by an average of 40 percent for almost a decade. After looking back on his successes and failures he noticed a pattern, one that he would base this book on.

Keller goes on to reference the Domino Effect, whereby a single domino can set in motion a series of dominoes, not only that, but a domino can bring down another domino that is 50 percent larger. This can be used in the same way for goals and actions. For instance, what single action will set up another action that will ultimately end in achieving a goal. Keller notes that highly successful people find the lead domino every day and keep setting things in motion until they reach their goal or target. Keller has already underlined things of importance for readers, one being the following sentence:

“The key is over time. Success is built sequentially. It’s one thing at a time.”

I used to struggle with this concept, I would want that instant gratification and success. This is something I learned through starting Jiu-jitsu, and I have to thank my instructor Robbie for drilling it into my head for the past couple of months. I know that a lot of people think that success happens overnight, but having read books and really delved deep into how success occurs I have come to the realization that this is far from the truth. Constant work at a skill, on a task, or on a project in a big part determines its success.

Moving on to part one, where Keller breaks down the lies of success that mislead us and derail our efforts. Keller notes that there are six lies that society deems are true in creating success:

  1. Everything matters equally
  2. Multitasking
  3. A disciplined life
  4. Willpower is always on will-call
  5. A balanced life
  6. Big is bad

Now a few of these I already knew to be lies of success, such as multitasking, where you try to get multiple things done and you seem like you complete them both but ultimately you actually waste time in hopping between the two. Your mind has to adjust to the new task each time. That’s why you notice that your productivity goes down when a co-worker asks you to do something, as you then have to turn your mind to the new task to receive information, then go back to the one you were just working on.  However, I would have thought that discipline would be a key of success. But how Keller puts it changed my mind, how you can use discipline to create habits that lead to success. So, in the sense where self-discipline breaks down after a while unless the habit is made.

Never really thinking about if everything mattered equally I just assumed that everything was equal. Keller though would say that nothing is equal, in a contest one team is always going to be better, no matter how fair the official is, a person will always be more talented in one skill over another. Keller notes that when it comes to decision making, on what task to complete first we tend to trade the best decision for any decision. When everything seems important, then everything seems equal, we then try to complete everything at once, or value something that is not as important over something else as it seems more urgent. Making us busy and active, even though it doesn’t correlate with producing any results.

I am a sucker for to-do lists, I always make them and try to tick off the tasks on the list. Keller explains how they can become a trap of time wasting, as everything on the list seems important, even if it is a trivial task, it still sits on the same list as something more important. Keller referencing Australian prime minister Bob Hawke: “The things which are most important don’t always scream the loudest.” How to combat this lack of purpose in a to-do list, make a success list using the 80/20 principle, otherwise known as the Pareto principle. Take 20% of the list that would give you 80% of the productivity, and make a new list with that new 20%. Keller says to go even further, make a list that ultimately gives you only one thing to focus on.

Throughout the book there are many quotes by famous thinkers, writers and successful people from all walks of life, each giving a little bit of insight on the topic of the chapter. Not only has Keller underlined and included quotes, he has also summarized each chapter in a “Big Ideas” section at the end, meaning that instead of re-reading the book, you can just go back over each summary. The book is littered with figures and diagrams that help the reader visualize the concepts that Keller talks about.

Part two of The One thing starts with Keller telling his story of how got tired of “playing success” and ditched the lies of success that he talked about in the previous part and embraced the simple tactics that produce results. Starting with asking the hard question on what to focus on, what task are you going to focus on that will help you the most in working towards your goals, be it business, be it personal life, relationships whatever it is. Asking what Keller calls the focusing questions will allow you to break the task into smaller, more easily completed tasks. “The quality of any answer is directly determined by the quality of the question.” Keller includes a poem by J.B. Rittenhouse called My Wage that I will share with you below:

I bargained with Life for a penny,
And Life would pay no more,
However I begged at evening when
I counted my scanty store.

For Life is a just employer,
He gives you what you ask,
But once you have set the wages,
Why you must bear the task.

I worked for a menial’s hire,
Only to learn dismayed,
That any wage I had asked of Life,
Life would have willingly paid.

Noting especially the last two lines. When you ask for it, life will give it. However, you must take on the task of achieving it.

As covered in my review of Man’s Search for Meaning, by Viktor Frankl, Life is about searching and giving it meaning. Keller agrees and states that Life is a question, that is up to the individual to answer with their actions. Everyone will be different. Another benefit of asking the focusing question is that when you add on to that question “what is the one thing I can do such that by doing it everything else will be easier or unnecessary?” meaning that you can still have a big picture view of your current situation yet still focus on the one thing at that time and place that would make the next domino fall with less effort.

Keller talks about creating habits of success, habits that keep you asking the main question that he pushes: “What’s the one thing I can do today for______ such that by doing it everything else will be easier or even unnecessary?” and you use discipline for the habit to stick. Keller notes that research says that for a person to form a habit it takes 66 days. To help you in establishing this habit, it is imperative that you give yourself reminders to ask the question. Part of the ritual of asking questions is to break the question down, into small, big, broad and specific. So, you might ask yourself “what is something I can do to double my sales?”, this would be a big and broad question, too broad, and it doesn’t have any urgency to it. “What can I do to increase sales by 5% this year?”, this is a small and specific question, gives a goal date, but the sales increase is achievable. This is where you would have to ask a big and specific question to maximize your results. The question might look more like this: “What can I do to double sales in six months?” making it a habit to ask the questions in this way, gives you a large and challenging goal that you will have to work harder to achieve, while giving you a strict timeline whereby it creates a sense of urgency to complete it.

Moving onto part three, where Keller sums up how to get extraordinary results, where your productivity can be derived from the priority you give yourself at any given time, that works towards completing your purpose. “Live with Purpose”, how do you find your purpose? Well, you have to take on a task that you choose, it might be that you want to create a business, or that you want to grow your own produce and help reduce your pollution, whatever the case maybe it is up to you to decide on a purpose. As Keller puts it, “Who we are and where we want to go determine what we do and what we accomplish.” However, I will state that if you are struggling with a purpose and you are not sure were to aim. My advice, pick a direction and shoot, as long as you learn something from it, even if it is that you learn you don’t want to do it, then there is no harm done by it. Just don’t get discouraged and pick another thing to aim at.

With many repeating concepts such as goal setting, such that it gives you a clear big-picture direction that you can focus down on to what to do right at that moment of your day, where that action tips the next domino. Blocking time, not only time dedicated to your one thing, or big project but more importantly, a time where you can relax and time where you plan for the next week or month. The idea of making yourself accountable, where you actively seek and acknowledge reality and therefore find a solution to the problem you are faced with. Keller has written a great book, where most, if not all, of the concepts of The One Thing can be applied across all aspects of life. And Keller recognizes this, including a chapter all about putting The One Thing to work, including personal, family, job and a few others, all with examples of questions that you could ask of yourself.

The One Thing is another book to recommend to all of you, as I have only covered a fraction of the material. Keller and Papasan have written a great book, with a lot of new and old ideas that are actionable and backed by studies and research that was compiled over the four years before the book’s release. I buy most of the books I get through booktopia.com, I like the hard copy feel. However, if it is easier for you to get a PDF and chuck it on your Kindle or listen to an audiobook then I can highly recommend that you do so. What’s your One Thing? The thing you want to complete today, next month, next year? Let us know below.

Please like, comment, share and follow.

See you on the mats.

 

 

 

Top 10 habits that have changed my life

Here are 10 habits that have changed my life. My favorite would have to be either 1 or 4.

  1. Reading more

Getting back into reading was one of the best things I could’ve done. There is so much knowledge and life experience available in the pages of books. Experiences that I could learn from. My girlfriend and I are building quite the library from having only a handful to now almost 50. I try to read at least 10 pages or 20 min a day, all ways of learning something new.

  1. Journaling

I made it a point to start this year, and I have only missed a handful of days. Journaling is one of those things that I thought I would never do, however, it has been quite therapeutic. Putting thoughts on paper allows me to clear up the headspace and gives me the ability to focus on the daily goals. I have used 5-minute journaling for over a month and have not gone back. It’s an easy 5-minute task at the start and end of the day. Usually while eating breakfast and before bed.

  1. Listening to/watching interesting people

Listening and watching podcasts has become a staple of my routine. I listen to a podcast while I work out, Jocko podcast has been the main voice in my ear. And when my day is winding down I try to watch the Joe Rogan Experience Podcast. Both offer many different views from many different interesting people, Jocko reads military books and will provide his own view, and well, Joe is Joe and brings on a plethora of interesting and exciting people, some with views that challenge my own, others that provide motivation and some that just provide a laugh.

  1. Undertaking tasks that are challenging

I think this is one of the biggest changes I have done. I would’ve usually been fine in doing the bare minimum, I cruised through high school and most of my university. I often felt like I should do more. So, I decided to bite the bullet and take on challenging tasks, not ones that have been placed on me, but ones I have set for myself. Taking up new hobbies, different things that I would’ve otherwise never done only showed a little interest in. I have completed two blacksmithing courses, started BJJ and started this blog. It isn’t easy but I enjoy every moment of it.

  1. Waking up early

I wake up at 5 most mornings and get gym out of the way early, I feel that I can complete more during the day with those extra morning hours when most people are still asleep. Some will say I’m crazy, but then those people probably don’t want the things I want. I will say that it is not for everyone, some may find that they work better in the midnight hours and that is fine. Not everyone is wired the same, I just happen to be a morning person.

  1. Exercising daily

I have always been active, however, the past year I have really tried to get the body moving daily. At least an hour at gym or BJJ training. Studies have shown that physical activity can improve quality of life and health outcomes, like reduced chances of cardiovascular disease and improved mental-health, amongst other benefits. When I have a lot on my mind I tend to try to get out of my head and into my body, pushing weight around a room I find it somewhat therapeutic.

  1. Doing a martial art

The physical adversity that comes with martial arts is something that will test all people, be it boxing or wrestling, Muay Thai or judo. Any martial will bring challenges that help the mind and body grow. Martial arts teaches discipline through training a technique over and over, confidence in your own ability to defend yourself, helps form new friendships and teaches you to be resilient under stress. I have to say that doing any martial art will benefit anyone, however, I reckon that BJJ is the way to go for many reasons which I lay out in this article.

  1. Sorting out my finances

It’s something that not a lot of people want to think about, however, if you don’t then when you need to think about it, it’s already too late. This is something that I think all should do, or at least attempt to as it gives you a peace of mind. I personally use the barefoot investor method, which I cover here. So far having implemented it for a month together with my girlfriend we have saved a weeks worth of wages while going on a holiday and still living our lives. So, the method allows you to still live your life by allocating spending money, whilst you save for the future.

  1. Taking control of my attitude

Attitude is something that only you can control, no one has any power over what kind of attitude you have. I used to be a bit of a hot head, still can be, but I have learned that my attitude can dictate how I react to something or someone. When reading Man’s Search for Meaning, by Viktor Frankl, I began to understand that my attitude has really helped me navigate through life’s triumphs and tribulations. Not letting something or someone get the best of you all starts with your attitude and how you choose to react to it.

  1. Fear and goal setting

I wrote about this in a previous post. I never used to do either, but with the use of both, I am able to aim at my goals and strive to reach them, whilst also working away from my fears. Effectively it means that I have to modes of motivation, something pulling me and something pushing me. When setting goals, it is important to dream of the biggest goal, so for me it is to be financially free one day, then I have a five-year goal that will help me achieve that, then a one-year to a five-year, then a six month to reach that one year, and so on until it’s the goal for today. Which will help me reach the ultimate big picture goal that I first set. I will be covering The One Thing by Gary Keller with Jay Papasan, where goal setting is talked about at length.

 

So, these are my top ten things that I have done or used that have changed my life, they might work for you they may not (5am wake-ups can be a killer…. if you hate them). If you have any questions about anything I have covered, do not hesitate to ask. What habits have changed your life?

Please like, comment, follow and share.

See you on the mats.

 

Book Review: The Barefoot Investor, Scott Pape

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The only finance book you need to read? Maybe. Its good place to start.

Scott Pape has labeled The Barefoot Investor as the only finance book you will ever need. I have to agree with the statement to a degree, it helps you get out of debt, save, invest and look ahead to the future. However, you should use it as a base upon where you build your knowledge from. However, it only works if you do the work.

The book is a step-by-step guide, where Scott runs you through all the little things you should do to clear your debt, save and invest your money in and why. He has done a brilliant job of simplifying finance so a single mum can clear her debt and start saving for an initial down payment on a home. The book is littered with feel-good stories of people like you and me showing you that the principles Pape employs himself work, and you don’t have to be a financial wizard to become financially stable.

The book, however, revolves around couples who go out on date nights, and that between the two of you, you have to be making at least 1000 and month. Of course, this is great for those that can achieve that. However, if you are a struggling uni student who is single it’s a bit harder. Yes, that is only a very small minority of people, but none the less I believe that everyone should at least read the first 6 steps of the book as they will set you up quite well. For everyone else who can make the collective $1000/month, this book is a must.

Pape also lets you know you don’t have to be a tight-arse to do all these things, he doesn’t even want you to budget. He gets you setting up an autonomous banking system each account with different names like ‘splurge’ and ‘daily expenses’ also the names that you write on your bank cards to make sure that you don’t mistake the cards.

I will say that the book will help you get out of debt, save money, and invest your savings, however, you must implement the strategies put forth by Pape, as he won’t be setting up your bank accounts. Well, he might if you ask him nice enough. Furthermore, you should read other books that will broaden your understanding of finances. I enjoyed ‘The Richest Man in Babylon’ which follows a similar outline of Pape’s book, but more Laws that you should abide by regarding money.

Overall ‘The Barefoot Investor’ is a great finance book that is easy to follow and understand, Scott Pape lays it all out in layman terms in a step-by-step format. However, the process will only work if you put it in place! I will post an update on how my finances are going once I have implemented the content for a longer period of time.

The Barefoot Investor: The Only Money Guide You’ll Ever Need

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