Archives for May 2016

Talent is important in accumulating wealth. That is why I often write about the need to discover your inborn talents. All individuals, by virtue of their genes, are born with certain talents that set them apart from others. Only through experimentation will you discover what those talents are. You have to throw a lot of mud at the wall and pursue numerous different activities in order to reveal your inborn talents. Most don’t do this. Instead, they focus on two or three activities (baseball, soccer, piano, etc.) and spend most of their childhood years devoted to those limited activities. That formula will never reveal your inborn talents.

But a small percentage are encouraged at an early age by their parents to be explorers and those few lucky individuals eventually stumble upon their innate talents. You know you’ve found an inborn talent because passion always trumpets it’s existence. The brain communicates to us the existence of an inborn talent by infusing us with passion when we engage in the activity. Passion acts like a catalyst in driving us to continuously engage in an activity we were born to do. Passion allows us to focus like a laser in perfecting our skill. Passion gives us the emotional energy that enables us to engage in our inborn talents for many hours every day. Days turn into years and years into decades. Eventually we not only become skilled in the inborn activity, we become expert. And experts are always paid the most.

Those few fortunate explorers who are passionate about what they do for a living are the ones who have discovered their calling in life. Everyone has a calling. So, no matter your age, become an explorer. Only through exploration will you find that which you were born to do. Once found, you will be infused with a passion that will energize you to engage in that activity for the rest of your life.

When we force ourselves to concentrate on any task we use something called willpower. Willpower is a finite resource. Once our willpower begins to fade, called willpower depletion, our brain tires. We soon find ourselves daydreaming about something else, engaging in bad habits and making poor decisions. Because willpower depletion impairs our thinking, it is important to become self-aware of your own individual willpower threshold. Knowing when you have reached our willpower threshold is important because it can save you from making poor decisions and engaging in bad habits.

Each individual has their own unique reservoir of willpower energy. Some naturally have more, some less. On average, willpower, or your ability to concentrate, lasts between 90 – 120 minutes. When you find yourself hitting the willpower wall you must take immediate action because not doing so can cause you to do things you regret, such as making a reckless spontaneous purchase, caving in on an important negotiation item, or losing control over your emotions. So, what do you do when you begin to exceed your willpower threshold?

When you run out of willpower, you essentially run out of brain fuel – glucose. A quick fix to this is eating something with sugar in it. This immediately boosts your glucose levels and temporarily restores your willpower. This quick fix should only be used in emergency situations because after 20 – 30 minutes you will find yourself even more depleted than before and your thinking even more impaired than before. A better fix is to eat a healthy, high protein meal or take a power nap (30-45 minutes). Eating a healthy meal or taking a nap completely restores your willpower, giving you another 90-120 minutes of clear thinking.

Understanding your willpower limitations helps you make better decisions, avoid bad habits and prevents you from losing control of your emotions, which could damage your relationships.

Economic calamities happen. Some are worse than others. Depressions are, by far, the worse type of economic downturn. But they are rare. Recessions, however, are more commonplace. During recessions, millions lose their jobs. In the aftermath of a recession bloodbath, many lose their homes, families are fractured and careers damaged, temporarily or irreparably. During recessions, those affected the worst never fully recover. For them, life will never be the same.

In a given career, an individual could likely expect to face 3 or more recessions. It’s the nature of capitalism. What goes up, must eventually come down. Since the Great Recession of 2008/2009 ended, we have seen anemic economic growth in most parts of the world. The United States, it seems, has fared somewhat better. Still, in the United States, today, there are approximately 30 million who are either unemployed, underemployed or who have given up trying to find work. That is 14 million more than in December of 2007. For these individuals, the Great Recession never ended.

So, if it’s likely that you will have to face future recessions, what can you do to avoid being one of the casualties? Below are five strategies that will not only help you to excel in your career but make you immune to economic downturns. In effect, these strategies will make you Recession-Proof:

1. Become an Industry Expert – When you become an industry expert you are the last to get fired. You are indispensable to employers, customers and clients. To become an industry expert you need to make a daily habit of growing your knowledge-base. This means not only acquiring new knowledge, but also reinforcing what you already know. To become an industry expert you will need to devote between one to two hours a day to reading and learning.
2. Create Multiple Streams of Income – Those who fare best during recessions are the ones who have built up over time multiple streams of income. In my research, immunity seems to occur at the point in which you have created at least three streams of income. When you have multiple streams of income, when one more more streams is adversely impacted by a recession, the remaining streams come to the rescue, like knights on a white horse. Building multiple streams of income takes many years, but it virtually guarantees that you will survive a recession, life in tack.
3. Be a Brand – Those individuals who have successfully branded themselves are the most sought after individuals in any industry. Think Tony Robbins, Taylor Swift, Warren Buffet. While the flood of money into the bank accounts of these individuals may drop somewhat during a recession, they are still in great demand. Companies and events will still hire Tony Robbins for motivational talks; Taylor Swift will still be selling her music and will still be hired by the wealthy for private events; Warren Buffet will still have more devotees than he can manage, investing alongside the “Oracle of Omaha”.
4. Forge Rich Relationships – Building strong relationships with successful individuals means doors will be opened to you that are closed to everyone else on the unemployment line. When recessions hit, those doors often seem to be padlocked. The more successful individual relationships you forge over time, they more individuals you will have to unlock those doors.
5. Create Trails – Some call this residual income. Residual income is cash flow that continues to flow to you as a result of previous efforts. Those previous efforts represent assets you have built up or created over time that dispense income. It might be rental income, guaranteed annuity income, dividends, interest income or any number of cash flows coming from your previous efforts of building assets.

Every day, day after day, I pursue five things that help move me forward in my dreams and goals. I call it my Daily Five. These are five identical things that automatically pre-populate my to-do list every day.

How many priorities do you have every day? Do you even have any priorities? If you have no priorities than you are like a leaf on a fall day, floating around aimlessly, without direction.

I have found that the magic number of priorities most of the successful individuals in my study were able to tackle is between 3-5 priorities. 3-5 is the magic number. Less than 3 and you won’t get very far on your dreams and goals. More than 5 and you will likely get overwhelmed. Start creating your top 3-5 priorities and automate them on a daily to-do list. The to-do list serves as your accountability partner; your external motivation to get done what you need to get done. Don’t be a leaf on a fall day.

“Skill and passion are often confused for one another, but they aren’t interchangeable. YOu can be really good at what you’re doing, and not be passionate about it, and in fact totally loathe it. So, ask yourself if you are passionate about what you’re doing and, if not, what you are passionate about. What excites you? What gets you going and motivates you to keep going. You will find more personal and professional fulfillment at the place where natural talent and skill meets your personal passion. That is the place where you will find your motivation and be able to maintain it for the long haul.” John Addison, personal development leader and contributor to SUCCESS Magazine.

Luck, good or bad, results in success or failure. In my five year study of the habits of the rich and poor (Rich Habits Study), I discovered that luck plays an important role, a critical role, in determining success or failure. In fact, 87% of the rich in my study admitted that good luck, or unexpected good consequences, made it possible for them to amass their enormous wealth. Conversely, 54% of the poor admitted that bad luck, or unexpected bad consequences, forced them into poverty.

But there’s more to the story. The luck that helped forge a life of success for the wealthy was a unique type of luck I have come to call Opportunity Luck. Successful people do certain specific things every day, oftentimes for years, that gives birth to this Opportunity Luck. What I’m talking about is the principle of Cause and Effect. Successful people create the opportunity for good luck by doing certain good things every day, for many years (the cause) and good luck follows (the effect). Good habits, I discovered from my research, are the cause and Opportunity Luck is the effect. This Opportunity Luck is typically something unexpectedly good that occurs while the wealthy are in pursuit of their dreams and goals. Because they go all in and pursue success every day by forging specific good goal habits, eventually they get lucky. Even a blind squirrel can find an acorn if it’s persistent enough. So too with successful people, I found. Persistence, in the application of good daily habits, eventually results in good luck. The key is the persistent application of these good habits. Persistent good habits, or what I call Rich Habits, sets the stage for good luck.

Conversely, poor people create something I have come to call Detrimental Luck. This is another cause and effect type of luck that is the result of doing certain bad things every day, for many years (the cause), and these bad things result in bad luck (the effect). Persistence, in the application of bad daily habits, eventually results in bad luck. The key is the persistent application of these bad habits. Persistent bad habits, or what I call Poor Habits, sets the stage for bad luck.

If you want to change your luck you need to change your daily habits. Rich Habits foster Opportunity Luck and Poor Habits foster Detrimental Luck. Change your habits and you change your luck, which changes your life.

Cancer is the number two cause of death in the United States. A team at Harvard Medical School conducted a long-term study on the health data of about 140,000 health care professionals. Based on the habits reported by the survey subjects, they were either classified as healthy or unhealthy. The conclusion they reached was that about 40% of all cancer cases and half of all cancer deaths were caused by habits. What habits cause cancer?

• Eating too much bacon and red meat (stomach cancer)
• Drinking in excess (colon, breast, liver, head and neck cancers)
• Smoking cigarettes (lung and oropharyngeal cancers)
• Obesity – Eating too much unhealthy food (stomach, esophageal, colon, pancreatic and other cancers)

According to a 2006 Duke University study, 40% of all daily activities are habits. Your habits determine if you will live a long, healthy life or spend your waning years in and out of a hospital bed. Change your habits and you will change your life.

It was clear to Winston Churchill, early on, that the Nazi regime was a great evil that needed to be defeated at any and all costs. Churchill knew Hitler would never stop his aggression until he conquered all of Europe, including England. Nevill Chamberlain (England’s Prime Minister at the time), however, did not have the stomach to defend England from the Nazi’s, so he sought, instead, a compromise with Hitler. After Hitler invaded Holland, Belgium and the Netherlands, Chamberlain was replaced as Prime Minister by Churchill. England went on to rally the world against the Nazi regime, which was eventually defeated.

Those who pursue something they are passionate about are able to overcome their fears. Because they are 100% committed to their dream, purpose or calling in life, they do not give in to their fears. They go all in. They single-mindedly focus on realizing their dreams and no obstacles, pitfalls, failures, temporary defeats, rejections or mistakes are able to take them off their path or distract them from their single-minded focus.

The Churchill’s of the world never surrender, never compromise. They either succeed or die trying. So to those of you pursuing a dream, purpose or calling, I ask you, are you a Churchill or are you a Chamberlain?

Humans have a bad habit of making assumptions. Assumptions are, by definition, the act of accepting a truth without definitive proof. A habit of making assumptions is a bad one because it can lead to unexpected consequences, oftentimes bad ones.

In my five year study of the daily habits of the rich and poor, this one data point nearly slipped through the cracks because it turned out that rich people and poor people share, to some degree, this common bad habit. Fifty-six percent of the rich and 72% of the poor in my study engaged in the habit of making assumptions.

But when I drilled deeper, I made an important discovery. Out of the 233 rich people in my study, 177 were self-made millionaires – they came from the middle-class or from poverty. In this smaller group of millionaires, the self-made’s, 57% did not have this bad habit. Why? Most of the self-made’s in my study were entrepreneurs, or individuals who were pursuing some dream or big goal in life. As a result of their past experiences in making false assumptions and suffering the financial and emotional consequences of this bad habit, they stopped engaging in this habit. They figured out, early on in their pursuit of their dreams and goals, that making false assumptions leads to costly mistakes that could lead to failure. So they stopped doing it.

You make false assumptions when you do not ask enough of the right questions. So, seeking feedback from others, prior to making any important decision, is a firewall against making a false assumption. Seeking feedback, therefore, is the cure for false assumptions.

After five years of studying self-made millionaires I’ve come to the conclusion that there is a process they all seem to follow. Here it is:

1. Take a Risk – Pursue some big dream in life.
2. Develop Goals – Develop goals around your big dream. Goals are the action steps you need to take in order to realize your big dream.
3. Take Action – Pursue your goals.
4. Fail and Make Mistakes – When you take action you will find out what works and what doesn’t work. You will fail and make mistakes.
5. Revise Goals – Failures and mistakes help provide critical feedback on what you did wrong. That feedback will help you develop revised goals.
6. Take Action Again – Pursue your new goals.

Repeat steps 4 through 6 until your action produces success – goals achieved. Every goal you achieve will help move you closer to realizing your big dream.