How do you feel when you think about financial freedom? Does it feel like pit in your stomach? Does it always feel like your financial freedom it’s 5 years away? Well, it doesn’t need to be that way!

Watch this short 7 minutes video and learn about easy 5 step process of making success path to reach your financial freedom. Let’s make that pit in your stomach permanently disappear!


Transcript

 

Today we’re going to be talking about the success path to reach financial freedom. So here’s a question I have for you. Do you find there’s a pit in your stomach that appears every time you think about becoming financially free from your business? If this happens to you, you’re not alone. What if I could show you an easy five step process that you can use to find financial freedom and make that pit in your stomach permanently disappeared.

Hi, I’m Josh Patrick and I’m the founder of the Financial Freedom Project and the author of “Sustainable” – a fable about creating a personally and economically successful company. So let’s jump in and look at the five steps you need to take. First, you got to start off with knowing that you have a problem. Now, I hate using the term problem, but the truth is it is a problem and the way you’re going to know that you have this problem is if you answer “Yes” to the following question:

“Does financial freedom always feel like is five years away?”

If the answer is yes, I can almost promise you that there’s an issue around you reaching financial freedom from your business, and today we’re going to tell you about the five steps that you need to do, but step one is start that knowing you have the problem and if you answer yes to this question, you probably do. If you answer no, then you don’t and you can move on.

So in my experience, the first step in reaching financial freedom is admitting that you have an issue and wanting to do something about it. So let’s look at step two and step two is really an important thing is something that almost all business owners miss and that’s understanding the real value of your business.

Now, most business owners I know overvalue their business by somewhere between three to four times and there’s a good reason behind that.

And the reason very simply is, is that you’re depending on cashflow to live on after you sell your business, and the only way you’re going to get cashflow that even matched or comes close to matching what you’re getting while you’re running the business is by overvaluing your business by three to four times. Now, the issue with that is someone who wants to buy your business is not going to pay you three to four times the value of your business. And here’s another issue about the value of your business.

You know, a lot of times I see financial planners take you say, my business was worth a million dollars. Well that million dollars may be an accurate number, and it may not be an accurate number. But the truth is it’s not accurate because you probably haven’t factored in the cost, the taxes and fees and that million dollars is likely going to be reduced by $300,000 to $400,000 or 30 to 40 percent. Then finally in the valuing of your business, there is a term you need to know what it means. And that term is EBITDA (E,B,I,T,D,A ).

EBITDA stands for earnings before interest, taxes, depreciation and amortization; And that’s going to be the number that we use to help determine what the value of your business really is.

Step three is to know your financial status. Now this means having a financial plan has done for you. That’s a special financial plan just designed for owners of privately held businesses. And there’s two things that need to be really taken into account when we’re doing this financial plan for you. One is we need to know what expenses your business is paying for today, which really is lifestyle expenses, and what this means is you’re going to convert your life when you leave your business from a pretax expense business, meaning that you can deduct much of your lifestyle to a totally after tax expense, where you’ll be able to deduct none of your expenses.

You need to understand that you need to be really realistic about investment returns.

Now, this is not one of the two mistakes that only business owners make. This mistake that almost everybody makes when they’re putting together a financial plan, if you’re using more than a five or six percent long term return, you might be in for an unhappy result. Now you might get better than that and that’s always a possibility, but I rather be safe than sorry when we’re doing this sort of planning. And finally when you’re doing that plan is going to point out where the problems are and what they are and knowing what and where his problem is really important because knowing what the problem is, is really the first step in coming up with strategies to help you reach financial independence. And that leads us to the next step we want to take, which is knowing one strategies that you can actually use to reach financial independence.

Now you have to understand that there are a least 10 strategies that can get you there. The truth is – you only use between one and three to do that.

So once you understand what the strategies are, you need to write them out and choose one and only one to start with and that one and only one that we start with, we’re going to be experimented with and I call this fail fast, fail cheap. And the reason we’re going to do these simple experiments that are easy and quick to do is the more effort that you put into a project, the harder it is for you to walk away from that project.

So my mantra always when I’m trying to get somebody to financial freedom and how people think about that is sort of really think about, fail fast and fail cheap.

Then finally, we want to get to the stage that we call implementation. And implementation is where you actually get stuff done. Now, the first four steps you’ve been thinking about, we’ve been planning, which are all good things to do. But nothing is going to happen until you implement. And again, you only implement one strategy at the time and the truth is you’re going to implement pieces of one strategy at the time. You’re not going to go all again. You’re going to experiment to see if that strategy is actually getting the results you want and the way you find that out is by having a dashboard that tells you what’s going on with metrics and metrics are the truth been a key for what’s going to get you to financial independence and know that you’re there. Now as you’re implementing these strategies, we’re going to review and make adjustments and finally we’re going to be happy with that strategy. We’re going to pursue it and it’s time for us to say, is this enough or do we need to go to another one.

And this is where we use the head and shoulders approach, which is wash, rinse, and repeat.

You do this over and over until you have enough strategy stack that’s going to get you to financial independence. So there’s a path you’re going to go on which are the five steps to get you to financial independence.

I’ve written an eBook about this called the Financial Freedom Project, which is available below this video just by clicking on the button and finally, why don’t you scroll down, leave a comment, let me know what you think, and thanks a lot for stopping by. I hope to see you back here really soon.

Topics: financial freedom, strategy, Video, leadership, Sustainable Business, inspirational, Success Path, coach, consulting, ebook, motivation, how to, business advice

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