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Today, I would like to share The 7 steps to Financial Abundance wrote by Adam Khoo  in this book. I’m yet to finish reading it, currently at Chap 10.

Step 1: Adopt the Million-Dollar Mindset. Millionaires think and see the world very differently. This is why they take different actions and produce such different results. Where most people see problems, those with the millionaire’s mindset see money-making opportunities. Millionaire’s mindset is further discovered in the Chapter 3 on Nine Habits of Self-Made Millionaire later.

Step 2: Set clear Financial Goals. The major reason why people never achieve any level of wealth, is because they never have clue or answer this questions came into his or her life “What are you financial goals?”. The four levels of Wealth will be covered soon in Chapter 5. There are financial, stability, financial security, financial freedom and financial abundance.

Step 3: Create a financial plan. Once you have a specific financial target of how much you want to earn, you have to develop an effective financial plan. For example, if you set to achieve 1 million in a specific date, you should target how much you want to save / invest per month and by other means like increase your main income. The chapter 4 & 5 taught how to craft a financial strategy.  

Step 4: Massively increase your income. Adam shared on how to massively increase income about doubling or tripling! It then further shared in Chapter 6, 7, 8, 9, 10, 11, 12.  

Step 5: Manage your money and reduce expenses. Dou you realize that increasing income is only one side of wealth equation? Millionaires become rich not because how much they earn, but rather how much they are able to save and invest. The chapter 13 and 14 shared on how you can reduce expenses by 20-30% without compromising you standard of living. I can’t wait to reach this Chapter.

Step 6: Grow you money at Millionaire return. By reducing your expenses, you will be able to accumulate a surplus of duns that you can use to build your fortune thru investment, stock, property and so on. Chapter 15 & 19 revealed investment techniques that can allow you to earn 15-25% per year with minimal risk.

Step 7: Protect you fortune. Millionaires engage professionals like insurance advisor, lawyers, financial advisor etc to protect their wealth from potential creditor or government (thru tax) and other party.  What do you think about his 7 steps? You may purchase this book at price RM49.90 but got this at discounted price RM39 last 2 weeks at Kinokuniya.

Dave Ramsey MM & SS #3  

Money Myths(MM) #3

Myth: Debt is a toll and should be used to create prosperity

Truth: Debt adds considerable risk, most often doesn’t bring prosperity, and isn’t used by wealthy people nearly as much as we are led to believe.

Shocking Stats (SS) #3

Shocking stats : 80% of graduating college seniors have credit card debt-before they even have job!

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This is a very quick review on Dave’s tool in his TMM:

Baby step 1: Save approximate RM250 (in the book is US1,000) for your emergency fund. It should be saved in most liquid account like the normal savings account so that we could use it during emergency like when car need repair, etc. Pls note that Hari Raya is not emergency okey.

Baby step 2: Start the Debt snowball. It’s not complicated, but it’s difficult. It requires us to list down our debts and start attacking the debt with smallest to largest so as to have some quick wins. I really love this principle.

Baby Step 3: Finish the emergency fund. A fully funded emergency fund covers 3-6 months of expenses. So, we would have enough money in 3-6 months if we lost our income.

Baby step 4: Invest 15% of your income in Retirement. You tool is Mutual Fund. He suggested to invest in Growth -stock mutual funds for long term. Growth-stock mutual funds are lousy short term investment because they go up and down in value, but they are excellent long terms investments when we are leaving the money longer than 5 years. He choosed mutual fund that have a good track record winning for more than 5 yrs, preferably 10 yrs. He didn’t took 1-3 years because he thinks long term.  He also spread the retirement investment ie: 25% Growth and income, 25% Growth, 25% International, 25% Aggressive growth.

Baby step 5: Invest for college funding. Make sure the Kids are fit too. Dave said we need to do some reasearch on the cost of attending college. Find out the college costs today and predict the costs when our kid is abut to enter the college let say in 10 years time. Stay away from loans; make plan to avoid borrowing. If you have scholarship, go! The first rule will be always pay cash for the kids college fee.

Baby step 6: Pay off your home mortage. You mortage term should be only 15 years duration. It is the best.

Baby step 7: Build wealth. Why we build wealth? The reasons is to have FUN, INVEST and GIVE.

Money Myths(MM) #2

Myth: Debt consolidation saves interest, and you have one smaller payment.

Truth: Debt consolidation is dangerous because you treat only the symptom.

Shocking Stats (SS) #2

Shocking stats : 49% American could cover less than one month’s expenses if they lost their income

My TMM progress

1- Starting last week, I’ve stopped made payment by Credit Card. All payment made by cash and Maybank Debit Card.

2- Today,  we just have a big shopping: 1) RM2000 invest in PISTF 2) RM2000 invest in PIDF. 3) While hubby invest in RM1,600 in PIDF.

3- To get rid off my two credits card: Maybank & Citibank. My Hubby is the lucky one. he don’t own any Credit Card

I was listening to Radio 24 yesterday, while driving back home yesterday. The DJ said something that really caught my attention. Some investors says that “ Bursa Malaysia is like having Mega Sales right now”. The market price is down and therefore, some investors taking this opportunity to buy more shares. I also found one article that I cannot recall the source right now. What Warrant Buffet does when market is in turmoil? He replied, “ Just smile and buy”

tmmo_book_2006_lg.jpg I just finished reading this book today @ 11.10pm. I took 8 days to complete this superb book. Totally agree with the his proven plan for financial fitness that was shared in this ” The Total Money Makeover “.

In this book, he shared the truth about debt and money and give steps and tools to set ourselves free financially. For Dave, Personal Finance is 80% behavior and only 20% knowledge. When I read this book, I was not read about mathematics or magic system but about changed lives. Many Money Myths (MM) and Shocking Stats (SS)was discovered. Many people’s success stories was shared. I’m motivated to be like them!

Dave shared …you have to change your life. When you change you life, you will get out of debt, give and invest at an unbelievable rate. His proven plan has inspired hundreds of thousands ordinary people to change their family tree..they have become DEBT-FREE.

I’m so excited to start my Total Money Makeover. My journey is just about to begin. I shall share Dave’s principles and tools later since my eyes is getting very sleepy right now. I’m too excited to share with all of you. My husband is also motivated to become DEBT FREE.  But before I shut down my laptop, let me share the first MM & SS.

Money Myths(MM) #1

Myth: I didn’t have time to work on a budget, retirement plan or estate plan.

Truth: You don’t have time not to

Shocking Stats (SS) #1:

90% of people in our culture buy things they can’t afford.

Happy weekend my dearest friends!