YOU DOWN WITH OPM?
Other People’s Money!
From seminars to strategy sessions, the buzz is that you want to make money, using other people’s money. That’s so true! It’s a wonderful sound bite! However, when these seminars come to town, they show you their mansions, their great vacations, summer homes and expensive cars and rock star lifestyle. That’s great! They will charge you money to get into the session and they tell you general things for over an hour, basically repeating catch phrases like: “I’m going to show you how I change my life from a minimum wage job into a six-figure lifestyle.” “You can stop dreaming and start living too if you use the methods I’m going to teach you.” “I had to change my mindset in order to change my financial outcome.” (duh?!) The list could go on and on. As you can see, I don’t care for the song and dance. The slides that they show featuring their lifestyle (houses, cars, yachts) are proof of how they live and what they do. Cool! Ironically, they can turn this presentation into a hour maybe an hour and ½ before, they ask you for additional funds to purchase books that will teach you the things that they promised.
First, allow me to say, I get it. No one obtains education or information for free! I agree. If a person invests nothing into the project, situation or idea then he or she isn’t ready to change their life anyway or start a business anyway. Having stated that, I understand all the fees. Secondly, most of the tactics in these seminars are geared toward changing and shaping the way a person views debt, money and opportunity. That’s needed. To make money, money has to be invested (not spent, there is a difference. I spend money when I bag a handbag, I invest into a project, business or idea for future return on that investment) and the investment must be managed. Now while I understand these points, I grow weary of the song and dance that doesn’t teach you the real about this entire concept of OPM (Other’s People Money).
- You can start a business, flip homes, using OPM, however there are steps to this process.
- BEFORE you can secure OPM, you must have a proven track record of managing YOM (Your Own Money)!
- When they say OPM, you do know they are referring to loans, lines of credit right? Many people do not know that. If the thought of debt frightens you or makes you worry to the point of poor performance then you may want to rethink what you plan to do. You’re not doing business unless you have some debt, expenses.
- Are you loanable? History? Track Record? It begins with the amount of money you currently make your job. How much of it do you use monthly? Is there anything left?
- NO ONE IN THEIR RIGHT MIND would complete an application for a loan, credit card or line of credit (loc) and say I have nothing left at the end of the month, but for the most part that’s true. Your bank statement reveals all. The sad part is that most people do not or cannot explain where their money is consumed. Are your bills too high? Too much on disposable goods?
- You need a method of tracking your information. You cannot change what you don’t know and you cannot know what you do not track.
- Additionally, your lack of assets, tell the underwriters for the loan, that you are a risk. Not only do you not know where the money is spent, but not having assets to show for the money made is an indicator that you as an individual do not manage money well.
- Outstanding debt or bad debts is another factor.
- Credit Rating
- YOUR TAX RETURN
Fudging numbers doesn’t work when you are trying to use OPM, it doesn’t work period but especially when you are asking for money to use for an investment. A true testament as to how well you will manage their money is based on how well you manage your own. You can lie (fudge) but everything works together to paint the complete picture.
YES using OPM to begin your investment, to start your business is the way to go, but make sure you have managed YOM first.
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Queen “B” of Doing Business Better
