Success. What does that word mean…to you?
Some people might say, “it means to be happy.” Others might say, “It means that you get what you want in life.” Still others might say, “To leave a legacy and have made a difference.”
Who could argue with those ideals?!
For the purpose of this article, I’m basing the question and answer on a very specific request I received from one of our Coffee Readers for Q and A.
Q…My Question is…Kevin, my wife and I are very blessed. My salary is about $54,000. I have excellent benefits but nothing to show for it at the end of the year. My wife earns about the same at her job. We live a pretty good life but I know where we are headed if things don’t change. Can you help us? Can you give us specific advice on how to be successful? How can we turn my $54,000 salary into a $250,000 salary without screwing up what we have right now? Thank you as always.
Just for the heck of it, let’s say that you also currently earn $50,000 per year, and you’d like to earn $250,000 per year, and that is your financial success goal.
What is going to be required to see $250,000 on your 1040 in April next year?
Does the goal even make sense in real life?
There are lots of attributes of success and all kinds of measurements, but this is easy because it is objectively measurable. Therefore, for the moment, let’s say we’ll talk about success at parenting, friendship, learning, love and legacy in another article. Let’s stick with the original question.
There is ONE important problem in the question. My friend doesn’t want to screw up what he has right now. I can completely understanding not wanting to lose…what you have…because that is human nature. We are LOSS AVERSE Creatures.
But the fact is something will change in the current situation because YOU will change. The other factor that was potentially of interest is that it’s not clear whether my friend’s income is “his income” or whether “their income” is “their income.”
Having two people both on board with the same What and Why is absolutely crucial in the case of married people. If you don’t, anticipate greater tensions and complex issues arising.
Now let’s answer the question…
Success Questions: What and Why
First thing in thinking about succeeding is pondering WHAT you want to succeed at and WHY?
There are two “What’s and Why’s.”
The first is what do you want to contribute to life and WHY?
The second is what do you want in return and WHY?
Everything else will stem from this starting point.
The What and Why can be very personal. In the 2000’s, I decided I wanted to grow my Net Worth by X dollars and be at home as much as possible when the kids got home from school…so they knew I was there and they were loved.
Then there was The What and Why for the actual body of work. In the 2000’s, I wanted to teach people how to influence to create more effective communicators and make it much easier to grow small Coffee Table businesses so others could do what I was going to be doing…growing a family and a business.
KEYPOINT: The What and Why needs to be bigger than you. It must be about you, those who depend on you, those you will serve and your reward.
The reason I don’t think in terms of “earning goals” is that “earning” is a complex issue. You can earn a million dollars and retain 30% after paying the Federal, State, and Local Government as well as employees, contractors and product costs. In fact your million dollars can be $200,000 or less.
Thus you always know that you can earn $1,000,000 and watch 1/2 of it be taken by the government. And with the other costs of running a Coffee Table business, you can be down to say $300,000 pretty quickly.
Then you have living expenses. A mortgage perhaps. Maybe you have a car payment. Maybe you have insurance, property taxes, sales tax, fuel, groceries, electricity, heat, air conditioning, cable, and so on. Maybe not. But whatever your situation is $1,000,000 earned is not $1,000,000 you will keep.
Therefore it is much wiser for YOU to set up NET WORTH GOALS.
My friend didn’t ask about net worth goals, so I will answer his question but I wanted you to know that $250,000…is no more $250,000 than he and his wife’s combined $100,000 is $100,000.
His $100,000 is approximately ZERO dollars, which is about what he ends up with at the end of every year if, in fact, he doesn’t grow his net worth…by a negative number.
Succeeding at generating an income is good. Succeeding at meeting a Net Worth Outcome is much better. When starting from ZERO or close to zero, using one year as a time frame to achieve $250,000 income is difficult…particularly coming out of $50,000 or $100,000.
Succeeding at generating $250,000 per year coming off of $50,000 per year and doing it with your Coffee Table Business where you will doX and Y is something you can work with. So let’s do it!
The What and Why MindSet
You begin with a WHAT AND WHY MindSet.
A mindset is a frame of mind, a lens through which you look at the world.
The WHAT AND WHY Mindset simply means you know what you want to DO and WHY, and it’s dramatically motivating!
Essentially, if you were to use Success as a Desirable Concept and you put your fee on that as $250,000 per year, you’d have to experience several MindSet Shifts to acquire that $250,000.
Without the shifts, the probability of someone going from $50,000 income per year to $250,000 in the next year is very low.
Let’s quickly analyze what has to happen.
Imagine you or someone, earned $50,000. That required 5 days per week, 8 hours per day, plus commute time. Let’s call it 10 hours away from home daily.
Trying to earn an additional $200,000 annually in a NEW field after your “day job” …particularly if your experience is minimal in generating revenue…success is fraught with difficulties.
We’ll need to know if that is $250,000 you keep to buy gold with or $250,000 before taxes and expenses. There’s a BIG difference.
What can you expect once you have The What and Why set?
Early on in a project or new venture, you can assume that it will require work and effort, no matter what anyone else says. If you want to earn 4-5 times (in our example) what you are currently earning, it will require several things happening. Most people see the advertising for an “opportunity” and it promises one thing without carefully noting that effort is a key ingredient.
In addition, the probability of a new venture generating $200,000 in the FIRST year with no experience or mentoring in the field and less than a full effort and full time… and trying to do this in ADDITION to a full commitment to your “day job” ….the probability that will happen is < 1%.
The chances of generating a total of say $100,000 of revenue in said venture would be significantly greater, in part because $100,000 is something you can somewhat wrap your mind around. It’s twice what you earned last year. You can probably imagine working twice as many hours and generating twice the revenue, bringing you to $100,000. (And once you are generating $50,000 in your own venture, generating $100,000 is much, much easier than you might imagine. You’ll see why as you discover the MindSets below.)
But $250,000 without Shifts?
That doesn’t “compute” using the “double the hours” calculation which the mind is prone to do.
OK, What and Why is the crucial first lens or frame. Anything else required to get to that $250,000 in the next year?