Starting over from point zero….

By: ispeculatornew
Date posted: 08.18.2010 (4:22 am) | Write a Comment  (1 Comment)

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Last week we took a look at our assets and how they’ve helped us get where we are financially and when you think about it, any move or job that you are currently doing was accomplished thanks to those assets. Now take a deep breath and close your eyes and imagine that you are down to no tangible assets, no money, no car, no house and just renting a place for a few months, with your knowledge and experience as your main assets.

One twist…

You cannot find a full time job, you need to start a business that will eventually enable you to build passive income. The good news is that you have a paid apartment for the first few months.

What next?

Knowing what you know, what would you do first and how would you organize your finances in order to reach a respectable level as quickly as possible? It’s a great challenge and many have done it in the past simply to prove themselves that they could do it!

What I would do…

There are no secrets, it is about being organized, and working hard. Here is what I would do, I am comfortable I could be back at a decent level in a year and back to solid income in 2 or 3 years.

Step #1 – Get a Plan

It’s all about being organized in my opinion and that is why many aspects are carefully planned, you simply achieve more. Here are the things I would determine:

business sector: the obvious one, internet business as this business is both easy to start and inexpensive. As well, it is very possible to achieve growth very quickly

how much do I need?: it is critical to determine a minimum amount necessary to survive as this will determine the possible reinvestments into the business

-making quick money: building a web business has its advantages but it also has downsides and it requires patience to start off because there is no get rich quick plan.

Step #2 – Work on the required minimum

If I determined that I needed 800$ monthly to live (apartment is paid in this scenario remember), I would probably try to write guest posts. TheFinancialBlogger wrote a good piece about this but basically this would require time but insure that I do not worry too much about eating every day:)

Step #3 – Work on the web business

I wrote about cheap valuations for internet businesses but since I have no money, I would be starting from the ground up. Getting quality content, traffic and making money. Once it does start generating money, I would do the following with the proceeds:

33% to increase quality of life
33% to save
33% to reinvest in the business

For a 300$ profit in the business, that would mean 100$ in each. So yes, despite making 300$, I would only increase my quality of life by 100$ but the objective is to reward myself but spend most of the money on the business.

The savings would help create an emergency fund, eventually a savings portfolio to create passive income through dividend investing.

And finally, reinvestments in the business would help in so many ways:

-domains
-hosting
-new design
-outsourcing
-coding
-etc, etc

As time goes by, both the business and savings would add up and lead me back to a similar position very quickly I’m sure. It would be hard work and I don’t think I’d put myself in that position for no reason but if I had to do it, I have no doubt I could.

How would you proceed?

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1 Comment

  1. Comment by Ray — August 18, 2010 @ 1:22 pm

    What the heck are you talking about? Your house and car aren’t income assets anyways, they are expenses. You should be glad to get rid of them if you are starting from scratch. Work on your financial education and you’ll only need a meager income to start buying up income producing assets and get rich. Working harder as an employee does nothing.

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