Temporary Vs. Permanent Income

Years ago one of my mentors asked me a very important question: He asked, “Is your current income Temporary or Permanent?”

Well I have to admit that I didn’t understand the question. So I said, “What do you mean temporary or permanent?”

Temporary Income

He went on to explain that when we earn income, exchanging time for money, our income is temporary. That is when we work for an hourly wage, a salary, a commission, or provide services for a professional fee, i.e. an attorney, accountant, doctor or consultants, we are clearly making this exchange of time for money. Now granted, this is the way that most everyone you know makes a living, or earns an income. So most people you know have temporary income. It is earned income and therefore requires that we do something everyday in order to continue to earn that level of income. Take a day off and you don’t earn. Now I know about personal time and vacation time, but what happens when you take the year off? You get the point.

Then he explained that when you “work” exchanging “Time for Money” you are simply renting your life to another. It is like renting an apartment. You pay the rent, (paying someone else’s mortgage, building another’s asset) but build no equity of your own. Everyone knows that owning is better than renting. When you work for someone else you do not have ownership, you build no asset, you have nothing to show for your years of hard work.

At this point in the discussion I realized my income was “temporary” and somehow knowing this was disturbing to me. I knew there were not enough hours in the day, or days in the week, to make that exchange often enough to create wealth. I felt lied to, the promise I was made growing up i.e. get a good education, get a “good” job, work thirty years and retire to the “good life” was simply a misinformed strategy that everyone I knew was engaged in.

But, just because everyone does it, does not make it the best or most effective way to build a lifestyle or plan for a successful retirement. It doesn’t take long to do the math, add up the number of years left before retirement, times annual income, minus living expense to realize it just doesn’t add up well. Another way to see this is, take all the money you have in savings, divide it by the number of years you have worked. That’s the average amount money you save every year. Multiply that number by the years left before you plan to retire. What an eye opener that is.

Small business owners are not any better off, sometimes worse off. They have made the commitment to start a business, taken the risks, put in the hours, hired the staff etc… only to find they are a prisoner to the business, they have no life outside of the business. They have ownership of an asset, but no lifestyle. No leverage, no permanent income. Many I know haven’t had a real vacation in a decade.

Real Estate is an option; like a small business, if you have enough capital, good credit, time to provide the sweat equity to manage tenants and property upkeep. Once the property is paid for (20 years later) and you have competent management, the cash flow can be enough. But it all comes with risks, many of which are out of your control. But it is a strategy.

Again many of us grew up hearing; get a good education, get good grades, work in a job/profession, and then retire to the good life. Well is it working for most people? Not according to the statistics. 95% of us reach retirement age without the financial resources to live well, in those later years.

So what is the other concept “Permanent Income”?

Well it’s simple; you stop renting and start owning. Get out of the rat race of exchanging time for money. Just knowing there is another model will inform all your new business decisions. You either build an asset base (investment portfolio) or build a business. The “Best” businesses are “System Dependant” not people dependent. People dependant means dependant on YOU. Whenever you are the “important” part of the financial success you have to be there. That means zero leverage. You want to become “unimportant” to the generation of your income. Find a business designed to provide you with maximum leverage through a systematic business model. Any business model that is systems driven can provide better leverage. Franchises provide this kind of systems or format, which allow them to duplicate success in multiple locations over wide geographic areas. If you follow the systems, the systems work. Owning one franchise is like buying a job, building several may allow for financial leverage and time freedom. Let’s be clear, you must have a product or service that moves to an end line consumer, but it is how that distribution happens that will determine whether you have temporary of permanent income.

Why Network Marketing/Network Distribution?

In my opinion, Network Marketing provides the best of all worlds, the start up costs are low, and the upside potential is enormous. With the right project risk is nonexistent. Networking Distribution by design is built systematically, once it is built properly, i.e. following the system, it continues to pay you every month whether you “work” or not. It provides the leverage of resources, time and energy; it provides Training Systems, Marketing Systems and the clear Business Model needed to secure an ongoing revenue stream. Network Distribution is that unique business model that provide franchise like, systematic methods of bringing a product or service to the market, while harnessing the power of current trends and the power of good marketing. Successful network marketing companies provide innovative, results driven products, creating the potential for “Permanent Income”, without capital at risk, it is truly a remarkable business system.

Today network distribution is gaining widespread acceptance and has proven itself to be the business model of choice for millions of people worldwide who use these systems and methods successfully everyday. Here is what some are saying today:

“If I were starting over today, I would make millions in the Network Marketing Industry.” -Donald Trump 2007

“There will be 10 million new millionaires created in the Wellness and Network Marketing industry.” -Paul Zane Pilzer 2006

Once I understood the difference between “Temporary Income and Permanent Income” I felt my regular, respectable job, was nothing more than a prison for my entrepreneurial spirit. Knowing that there was a better way, I became determined to understand and then master the system of creating permanent income. Acting on this information has made all the difference. I am grateful to those who helped me see and understand these differences and to those amazing people, who then taught me the value of building a successful network marketing business.

"I would rather be ashes then dust! I would rather that my spark should burn out in a brilliant blaze than it should be stifled by dry-rot. I would rather be a superb meteor, every atom of me in magnificent glow, than an sleepy and permanent planet.

The function of man is to live, not to exist.

I shall not waste my days trying to prolong them.

I shall use my time."

- Jack London

HABITS: YOU ARE WHAT YOU REPEATEDLY DO

“The beginning of a habit is like an invisible thread.
Every time you repeat the act you strengthen the strand.
You add to it another filament with each repetition,
until it becomes a great cable and binds you irrevocably to each thought and act.

First you make your habits and then they make you.

Your thoughts lead you to your purpose.
Your purpose always manifests into action.
Your actions form your habits.
Your habits determine your character,
and your character fixes your destiny.

Your habits are either the best of servants or the worst of masters.”