FIVE RULES OF MONEY

The 5 Rules of Money: 

The Pathway to Financial Freedom Welcome to ‘The Rules of Money‘ as presented by Michael Malata.

The principles listed within are nothing new but their execution can be the difference between Financial Freedom and financial failure. By committing yourself to following these rules of money on a daily basis, you are beginning to walk the path of Financial Freedom. Should you follow these rules long enough, the success you seek will find you. 

RULE #1-SPEND LESS THAN YOU EARN 

This is the first and greatest rule. None of these other money tips will help you if you cannot or will not spend less than you earn. This is commonly referred to as to live within your means'. What does this look like? You make $100k, you might spend $50k and save the rest. You make $20k, you spend $15k and save the rest. In both scenarios, the individual is generating savings. 

RULE #2-CREATE AN EMERGENCY FUND 

The first goal you should be saving for is a well-capitalized emergency fund. An emergency fund is a fancy term for having money available for when those pesky unexpected expenses hit. The car breaks down? The house needs a new roof/furnace/windows? Your child needs to have braces and you have not yet hit your deductible? No worries, all of this is covered by your emergency fund. 

RULE #3-SAVE OR INVEST THE REST 

so you are spending less than you earn, you have your emergency fund built up -what next? Here comes the fun part-you look for creative ways to invest the rest of your money. By this stage of the game, your acumen will have increased to a point where you have the 'basics' taken care of and will now begin to seek after the next stage in this financial journey, investing. The key to a successful investing strategy will be to own a good mix of stocks and bonds inside of a well-diversified portfolio.

 RULE #4- CAPITALIZE ON YOUR SKILLS AND START A SIDE ENDEAVOR 

Each of us has special skills that we bring to this world. Your goal is to find out what those skills are and then capitalize on those skills. The idea is to find the point where "PASSION POTENTIAL" and to pursue that idea until you have taken it to its full completion. This stage of the game is known as generating 'Active Income': income generation for which you you trade hours in the day. 

RULE #5-OWN INCOME GENERATING ASSETS THAT CREATE PASSIVE INCOME STREAMS 

Once you have an emergency savings set up, you are diligently working to pay off debt, and you are in a financially stable place, your immediate goal is to build systems and buy assets that can make money for you. In this place we can get creative with our ideas you could own real estate, stock vending machines, buy Lime or Bird scooters, sell ebooks and courses, or buy stocks that generate dividends. The ideas of how to generate passive income is limited only by your imagination and ability to work hard.

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