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From Red Bottoms to Black Bottoms

Updated: Jul 18, 2019


Accounting principles state when you owe more than you own, you are in the red. When own more than you owe, means you’re in the black. Which indicates a positive net worth. It’s one of the few times “black” is a good thing, as opposed to being black balled or black listed…

Let’s focus “the power of being in the Black.” Being in the black give you options and opportunities, reduces stress, no juggling and “robbing Peter to pay Paul”, giving you freedom, security and peace of mind.

Here are five steps to help you go from red bottoms to black bottoms:


1. Do a cash flow statement! Most people don’t know how much money they spent last week, let alone yesterday. You need to sit down and calculate all the money coming in (paycheck, child support, business revenue, etc.) and all the money going out (household bills, personal care, entertainment, travel, etc.) I recommend for people who have never done this to do a manual tracking for two weeks with a pen and paper or notes on your phone. Taking the time to track your spending will be eye opening to the things you spend money on unconsciously.


2. Create a spending plan and live below your means! Once you figured out your cash flow, you can then plan on how to spend your money and be intentional. In the book, Millionaire Mind, it discusses how most millionaires plan and budget their money. Planning your spending will help you stop over spending, gain control of your money and get out of debt. This is how you stay out of the red. You can plan to buy the red bottoms, at the right time and the right price.


3. Save! The average American saves 2.6% and personal consumption is up 3.4%. This is good for the government, but not necessarily for your household. We are putting ourselves and our families at risk if we don’t have an emergency savings established, at the bare minimum.


4. Create multiple streams of income! Whether you work for a company or are self-employed, you should always have money coming from different sources. A small business, investments, real estate, books, online courses. For example: we bought Facebook at IPO (initial public offering) and it has tripled. Airbnb started, we rent a room in our basement and made $1k in June, just on the weekend. The books I’ve written once, people are still buying. I get commission from various business referrals. All while running a consultant company.


5. Estate planning! Investments, life insurance, wills, trusts, health care proxy and a living will are critical tools while you are alive and you have an opportunity to leave a financial legacy with a little focus and determination. My mother, who was never wealthy, with proper planning, life insurance, pension and planning, she was able to leave money for her three children and two grandchildren that were born at the time. Don’t think you have to have millions to do an estate plan.


It’s never too late to get started and you’re never too far gone in your finances to get out of the red and into the black. Seek the help you need to get to where you want to go. You can still be cute and keep your cash! I’ll show you how to get the red bottoms while staying in the black.

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