| From DoingSuccess.com General Tips The Lottery Winner’s Syndrome One of the things I often see in people is what I call, “Lottery Winner’s Syndrome.” These are the people who think that riches equal wealth, that wealth should come instantly and without effort, and once attained, they can spend the rest of their lives doing nothing. In the United States alone, millions of people spend their labor-earned dollars to buy lottery tickets in the hopes of becoming rich … every week. And while it is true that if you do not play against overwhelming odds, you can never win the lottery, it is also true that your chances of winning big are infinitesimally small. And if you do win the lottery, there are no guarantees that the winner will keep it very long. A lottery winner may get rich quickly, but there are no guarantees that it will translate into long-term or lifetime wealth. There have been various stories in newspapers and magazines over the years that have followed up on various lottery winners. In many cases, the lottery winners either spent or overspent their money and actually went broke. They were actually worse off long-term than if they had never experienced the winnings. I know that sounds hard to believe … but it is true all the same. I hear people saying: _ “When I get rich, I am going to do nothing.” These people have the mindset that the work they do has to be miserable and unfulfilling … and that work is to be avoided at all costs. They cannot fathom work as being a form of play, or the need or desire to contribute to society. For some reason, they believe that once you become rich and wealthy, you should be ready to no longer contribute to society and that you should look towards your deathbed. The sad reality of it is that these people have never experienced even a small taste of monetary freedom … much less personal freedom. They may wish for monetary freedom, but they are not really willing to do what it takes to get there. We only have to look at the billionaires of the world to learn why they continue to work despite the fact they are wealthy beyond most people’s imaginations. Why does Bill Gates, Warren Buffett, or Michael Dell continue to work? They are billionaires. Surely, it cannot be for the money. They are working for purposes that transcend money. Then the Lottery Winner Syndrome types will also ask: _ “If he is rich, why isn’t it he giving it away for free?” Often it is the same reason why people will value a $1,000 suit more than a $100 suit. The $1,000 suit may not cost $900 more to make the suit … even with more expensive material … but the perception is different. The essence of economics and business is creating and establishing value and ultimately receiving compensation for it. The people who don’t understand this are among the people who know very little about business and economics. Businesses don’t become or stay successful by giving everything away for free forever. That is work for charities. People who want riches quickly will have to be dependent on one of the following: _ Marry into a rich family. They will either have to leech their way into wealth or luck into it … but most certainly not through building or creating it. Sam Walton’s Theory on Creating Wealth Wal-Mart is the largest discount retailer in the world today … thanks to the entrepreneurial efforts of the late Sam Walton. Sam Walton confounded many of his competitors during the early years … and even moreso as he guided Wal-Mart’s growth. Part of the frustration his competitors had was that he did things that seemed to make little common sense - but worked out to be a tremendous success in the real world. He had insights others did not see. One of the things he discovered was that the more efficient he was at providing value and discounts to the consumers, the more Wal-Mart was rewarded with business. The reason for this was that he did not underestimate the intelligence of his customers. He knew that his customers would recognize good value when they saw it, and they would reward that by giving him their business. Another thing Sam learned was that small towns had a lot of hidden wealth … and that wealth could support a Wal-Mart store. Before Wal-Mart came to small towns, many of the stores available to the townsfolk were simply sleepy little shops run by private individuals. And while there was a great deal of service, people still wanted value and excitement. Many of the more-established retailers believed that small towns had little wealth to support a major store. But that was why a town was small! What Sam realized was that even people in small towns wanted value and excitement in their products and jobs in their stores. So when a Wal-Mart came into town and established themselves; offering hundreds of different products at great value all under one roof … it became a shopper’s paradise. It wasn’t just the buying; it was the entire Wal-Mart experience. All of a sudden, the wealth that supposedly didn’t exist came into being because people now had a reason to spend money and buy things. That in turn led to more hiring. In the past, people simply bought what they needed. But now, people could buy what they needed, as well as things they never even knew they wanted. The ideas Sam Walton postulated and successfully confirmed would forever revolutionize the retailing world … it transformed Sam and his family into billionaires, and Wal-Mart was turned into the retailing powerhouse it is today. Now, I am not so bold to compare myself to the genius of Sam Walton. However, what I am saying is that I was willing to borrow a couple of the ideas that made Wal-Mart so successful and incorporated them into my own entrepreneurial and investment ventures. For those of you who want to learn more lessons from Sam Walton, I recommend you find the book he wrote, “Sam Walton: Made in America.” It is a great read with some wonderful business and life lessons. The idea of creating wealth in a smaller town is not only possible, but also it can actually be much easier there. For me, this meant the barriers of entry to create and buy investment properties were lower. I would become a bigger fish in a smaller pond. When I announced years ago that I would leave the great city of Atlanta to go to the smaller city of Columbus, Georgia, nearly everyone questioned and ridiculed me as to why I would do a thing like that. They thought it was foolish and that smaller cities and towns had few opportunities. Although in my mind … I saw plenty! I may travel and visit many larger cities, but I can no longer see the day that I would ever move back into a larger city to permanently live. I love the lifestyle of a smaller city, but I find plenty of abundance as well. The limited financial resources I had would be magnified in small towns. After all, it is far easier to buy a 3-bedroom house in Columbus, Georgia than what it would be in San Francisco. I also had fewer competitors. I could bring the innovative ideas that would come from larger, more cosmopolitan cities into a smaller, less sophisticated town … where the value of what I had to offer would be more impactful. Today, I believe part of my success has been my willingness to take what I learned in the bigger cities and then moved into a smaller one to implement it all. Big People do Big Things I have heard people say that people who want to be rich and wealthy are greedy people with large egos. While this may be true in some cases, I don’t think that there are any shortages of poor or middle-class people with large egos. The question behind this is, “Why accomplish something beyond your own survival?” These people cannot understand that “making a living” isn’t all that difficult. Nearly anyone can get a job to make a living and get by … it takes something more within to achieve more outwardly. I also hear from people that they would be satisfied if they could make enough money or have enough wealth to simply support themselves. The problem I see with that kind of thinking is that those are the same people who don’t provide much to society. They are not the great movers and shakers of our world. I will admit from personal experience that it does take a larger than normal ego to really want to grow big. But on the other hand, that part of the ego both serves and hinders me. My ego serves me in that it allows me to reach further and beyond what I might normally do to simply be comfortable. Yet, it hurts me in that sometimes it makes me a bit arrogant and self-righteous … or that I think I know more than I truly do. As a whole I do acknowledge that ego allows me and others to achieve goals greater than ourselves. But there are also many people whom we respect in the business world that have even larger egos. I have not yet met any of the following individuals on a personal level to give a first-hand account of what kind of people they are. However, I will leave it up to you if these people had big egos. And in doing so, did the world benefit for having what they created? Can you possibly imagine: _ Walt Disney World without Walt Disney? The list is virtually endless. For me, regardless of whom those people are or what they were truly like, the world has benefited greatly because of the “bigness” of these people. They achieved great and dreams … and yes … big enough egos to believe they could achieve such things. Please understand that I am not making it wrong for people who prefer to live a more humble and conservative lifestyle. However, the truth of the matter is that the scope of influence for most average people is fairly small and limited. Even if they want to make a bigger contribution to the world and serve more people, they are unable to do so … not because of their skills or abilities - but because of the mental limitations they have imposed on themselves in their minds and lifestyle. It does not upset me that people would prefer to live a smaller scope of lifestyle where they simply provide for their family. We should be so lucky to have even more people. There are so many deadbeats in the world. What upsets me is when those people automatically pass judgment on others who strive to be greater than themselves … simply to justify their own smallness and limited scope. The fact is when you stay small; you can only help so many people in society. When you become larger, your scope of influence is greater and you can potentially affect more change. My goal is to help make more positive changes in the world. Part of that strategy was for me to take the time to write this book, and then personally publish it to get it out into the world at large. I would even venture to say that many people who choose to stay small and only worry about making enough for themselves are sometimes more selfish than the wealthy people who provide opportunities to others, pay more taxes, give to charities, and change the communities and lifestyles of others. Wealthy people take on a greater sense of responsibility. So which do you want to be? Would you prefer to simply make enough so you can support yourself? Or would you like a shot to step up to a larger scope and make a difference on a grander scale? It is up to you. The Truth About Credit Cards Credit cards seem to get a bad rap in the public media. You constantly see books and so-called experts publicly bashing credit cards: how bad they are, how dangerous they are, and so on. True … there are credit cards that have the fine print where they hide high interest rates loaded with hidden fees and annual costs. However, there are also many cards that do not have any of this. The so-called “experts” blame the credit card companies for offering their cards to potential customers to abuse. They claim high-risk people are “not qualified” to have credit cards so they shouldn’t get them. That may be so, but it is not the “experts” that are taking the financial risk to offer the cards to new customers. The credit companies are. Last time I checked, I didn’t see any of those experts offering anything but their criticism. This is like saying that chocolate companies should stop selling their candy bars where overweight people shop because they are at a high risk of buying more chocolate in order to become even more overweight! Recently, there was a court case where someone tried to sue McDonald’s … claiming that it was their fault that he was obese. Apparently, he went to McDonald’s everyday to eat and he became obese over several years of eating there. I thought to myself, “What idiot doesn’t know that McDonald’s serves fast food that is fattening? And did McDonalds hold a gun to this guy and say ‘Buy our food or else!’? Were there no other restaurants to eat at? I think not. In any case, I digress. This type of attitude takes the responsibility off of the person truly responsible: the consumer - or more appropriately - the spender. There is nothing inherently wrong or evil about credit cards. The credit card is a financial tool used to convey payments in a manner much like checks, money orders, cashiers checks, and debit cards. It is true that there are many financially irresponsible people, and perhaps they are truly unable to control their buying habits. However, the fault lays with the user of the credit card … not the credit card companies. There needs to be more of an emphasis on educating people on how to better use their credit cards, control their spending habits, as well as in dealing with the underlying emotions and motivations of buying and spending. I have been an active user of credit cards since I was nineteen. I love my credit cards! Even though I have been a user of credit cards for most of my life, I don’t generally carry a balance. The times I carried credit balances have been times when I needed it - such as when unexpected expenses came up and they needed to be taken cared of. Credit cards have always been a helpful financial instrument for me. But then again, I had at a young age realized that financial power comes with financial responsibility. I have often used credit cards to fund entrepreneurial ventures that no bank would even bother to look at much less approve a loan for. Sure … I admit that I have lost money on those ventures, but I have also made money with them. Often, I would simply use my credit cards to buy office supplies, computer equipment, software, educational materials, business travel, seminars … things to that effect. What people fail to realize is that there are times when it’s better to pay interest now rather than to let time pass. For example, a seminar taken this year is often more valuable to me than one taken next year. Is the interest I pay for that one year worth having the information one year sooner? Often, if it is unavoidable, I will commit earlier. No one would ever argue against the idea that it’s better to learn how to add and subtract numbers while you are in elementary school rather than in high school. The reason being has to do with the cost of staying ignorant for a short time versus a long time. There often is a negative ripple effect for delayed knowledge. As an entrepreneur, I respect credit cards and value them greatly. People are running around saying that using credit cards is bad, and that all interest you pay on credit cards is likewise bad. This is because most people buy consumer “junk” that has little value thirty days after it leaves the store. I don’t make these kinds of generalizations regarding my finances. I make finer, more personal distinctions for myself. If I go out and eat at an expensive restaurant and charge it to my credit card, I know I have very little to show for it when the monthly statement comes in. However, if I buy a new color printer for my computer system, there is a good chance it will continue to provide ongoing value. It isn’t the credit card; it is what you use it for. I know what is required and what the costs are for charging on credit cards, as well as all the possible consequences. I have learned to be a responsible and knowledgeable user. People who know me will agree that I am fairly generous with myself when it comes to self-improvement or business-related expenses. The reason I am so generous is because more often than not, I don’t buy impulsively. I evaluate the money I am going to spend versus what I can get out of it. To me, it is an investment. And if it is something that I have determined as mandatory, I then see if the interest I have to pay is worth getting it today versus waiting until I have all the money. It is all a matter of return on my investment. Instead of teaching people how to think about and evaluate what they buy, many people simply say that credit cards are bad. I think that is an overly simplistic judgment and a very limiting point of view … especially when it can be a great source of entrepreneurial money. The fact of the matter is the major companies use debt to finance their growth and success; they know it is a form of leverage. If they borrow money at 10%, they know it is their job to generate 20% or more. Don’t get me wrong. I do believe that there is a point of having too much debt. This is called overleveraging. If you eat too much ice cream, you can become obese. But does that automatically make eating ice cream bad? No! The fault lies with the person who is doing the eating. There is this never-ending cycle that I see some people go through: people have poor spending habits. They spend poorly, regret it, and spend months or years paying off a debt that gives them very little benefit. Instead of taking on the responsibility themselves, they put the entire blame on the credit card company. As I said, I have not carried credit card balances for most of my life. And the times in which I have carried credit balances, it has mostly been for business-related expenses or unexpected personal expenses. As an entrepreneur and investor, financing is crucial. And unless you have become well established, financing can be quite the challenge. So, if I cannot formally obtain financing from banks or investors, then I am required to finance it myself. When I left the corporate world, I had only a little bit of money saved up. But I did not let that stop me from leaving … partially because I understood the power of financing and credit cards. I didn’t have all the equipment and credentials I needed to become a successful freelance technology instructor. Some of the things I needed included a notebook computer, additional desktop computers, software, supplies, as well as attending seminars and conventions. I felt quite confident that I would be successful, but I would be required to ramp up. Ultimately, I was faced with the “chicken or the egg syndrome.” I didn’t have all the required money to ramp up and be successful. And without being ramped up, I couldn’t make the money to pay all the startup costs. Because leaving the corporate world required some contrarian’s thinking on my part, I surmised that I would have to find a way to make things happen to get ramped up. As it turned out, I managed to barter my services by offering my time to perform pro bono work. However, I also didn’t hesitate to spend, get into debt, and pay the interest … because the spending I made would ultimately make me money. Yet, I was getting into debt by investing in my business and myself … not junk that sat in the closet. As a result of my decisions, I became fully ramped up within a year. And when I did, it was only a matter of months before I paid off the underlying debt. I did most of this with credit cards. Now, most people will say that this was risky. What if I didn’t make it? I admit that there is always the possibility of failure, but the bottom line is people who don’t make the leap lose anyway. They are trapped in a job with limited income and limited time. They then spend money by charging their purchases to their credit cards. In turn, these purchases don’t make them any money, and they ultimately spend most of their lives repeating this vicious cycle. Next article this series: Previous article this series: ====== Buy It Now:
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