A few weeks ago a buddy picked us up from the bar in his new BMW. He had spent al lot his savings on this car and he was excited to show it off and to display how fast it goes. In his opinion a nice car is clearly worth the money.

Should you spend your money on a nice car?

Driving is very expensive. I avoided driving for the longest time because I wanted to save money. I would take the bus or ask friends for rides. I just didn’t want to bite the bullet for the longest time. Why? There are so many better options to spend your hard earned money on, including:

• Traveling the world.
• Your savings account.
• Starting a business.
• Other expenses.

With that being said, you’ll still eventually face the internal debate in your later-20s or early-30s regarding the idea of buying a nice car. Buying a car is often a necessity depending on where you live. The debate comes down to buying a nice car or not.

What are the pros and cons of buying a nice car? Let’s start off with the benefits:

Prestige.

Depending on your profession, you might want the prestige that goes along with a nice car. If you’re in real estate or a field where you travel and visit clients, you’re going to want the prestige that goes along with a luxury car. You don’t want to show up in a 20 year old car that can barely make it there.

You online live once.

You really only get to live once. You can save all your money or you can live life and enjoy what this world has to offer. For some, a luxury vehicle is the best decision because they want to enjoy it. Priorities vary with income and age as well.

That’s the argument for buying a nice car. What’s the flip side? Why should you save your money?

Cars depreciate in value.

We all know that cars go down in value. In fact, a car will often depreciate as soon as you take it home. If you have to make car payments, you’re putting money into a depreciating asset. Does that make sense?

There are better ways to spend your money.

Once again, you can always find a better investment for your money. You can go back to school, upgrade your skills, or travel more often. I have a buddy that takes the bus to work, but counters this with going on many trips. It all comes down to your personal priorities here.

Should you buy a nice car? What do you think?

As much as I support the idea of starting a business, I truly believe that you can save a business as well. You don’t have to always be behind every business. You can be apart of the team or be the person that helps improve another business.

This interview on Forbes with The Rock really opened my eyes. This is what really caught my attention:

In April The Rock fought John Cena in a Wrestlemania battle, the most-watched in the history of the 27-year event, which raked in $67 million, thanks to 1.3 million pay-per-view downloads in 105 countries.

The Rock has made a living from saving franchises and businesses (movies and WWE). He’s known for hoping on movie franchises and re-inventing them. The Rock has seen plenty of success from joining onto an existing franchise.

How can you save a business? What can you do to jump on board?

• Perform consulting services.
• Work as an employee.
• Change the vision.
• Do a joint venture.
• Create a partnership.
• Do freelance work.
• Jump on board and take over.
• Buy the business.

That’s how you can do something different and save a business from dying or allowing its returns to diminish.

Why’s it better to save a business?

1. You can move on easily.
2. You become more valuable.
3. You get paid exceptionally well for being a highly valuable resource.

What are you going to do?

Will you try to start a business or will your plan be to save one? I can’t answer this for you. I’ve personally done a bit of both. I’ve started my own business and made money on my own. I’ve also been responsible for helping others save their business. When someone is willing to listen and actually pay you for you time, you can help them do something cool. You both benefit from this.

Will you save a business from dying? 

“If you don’t make mistakes, you’re not working on hard enough problems. And that’s a big mistake.” — Frank Wilczek

Do you ever experiment by pushing yourself to the complete max? Do you challenge yourself to your full potential?

I noticed something interesting the other day. I found that I’m not pushing myself the same way that I used to in the past. When I was in school, I studied full-time, worked full-time hours, maintained a relationship, and trained religiously. Now without school, I figured that I would work harder on my other projects. The result is more free time and less results.

This is why I wanted to touch upon the topic of challenging yourself to the complex maximum that you can go physically and mentally.

How can you push yourself to the max?

1. Do what nobody else wants to do.
2. Don’t be afraid of work.
3. Pick up new clients.
4. Train in the morning.
5. Wake up an hour earlier.
6. Take an evening course.
7. Tighten up your diet.
8. Learn a new skill.
9. Overcome a previous fear.

What can you do if you feel overwhelmed?

• Cut something out of your schedule.
• Take a nap.
• Sleep more.
• Eat better.
• Cut out the caffeine.

I don’t want you to burn out. I hope that these tips help you prevent burn out and losing your motivation. I want you to push yourself to the max without losing your mind.

Are you ready to start challenging yourself to the complete max?

Where does new business come from?  If you are a business owner, where do you find new clients and customers?   If you are considering going the entrepreneurial route, how do you plan to generate new business?

In a small business, there are generally two-types of client models: 1) relying on volume; or 2) relying on a few good clients/customers.  Of course I’m simplifying.  Also, the ideal would be to have both volume and consistency.

Volume Business

If you’re in a volume business such as me, there is always a concern as to where the new business will come from.  You have to actively seek referrals, hope for repeat business, and implement other strategies for finding new targets.  But relying on these methods can be stressful.  You have to hope that new business will continue to be generated, but you never know when your phone will ring or a prospective client will shoot you an email.  I equate this to the “rain dances,” of native american and other agrarian cultures.  I market, set up my website, write articles, and hope for referrals, but at the end of the day I’m still left praying to the business gods.

Focusing on a few Key Clients/Customers

There seems to be more security in having a few good clients/customers who retain you on a monthly basis.  For instance, I own a professional service firm and most of my clients are individuals rather than businesses.  Once I complete a transaction for my client, it’s over.  My brethren who have solid industrial/business clients, however, are often called upon on a weekly or monthly basis.  So long as they keep their clients, they don’t have to worry as much about where their next meal is coming from.  The danger here, of course, is an over-reliance upon a few key clients.  If one (or two) of them should leave, you might find your entire business is irreparably harmed.

The Middle-ground

One of the great things about a professional services business (i.e. doctors, lawyers, accountants, etc.) is that success begets more success.  The more clients I have, the more (potential) referral sources I can count on to potentially bring in new business.  If I have a roster of only 40 clients (past and present), then I am limited compared to someone who has 1,000 (past and present) clients.  If you are just starting out (like me), then no matter how good of a job you do, very little of your new business will be generated by present or past clients—-which are the best source of referrals in most fields.

That’s why I am more proactive than other people in my industry with trying to find other sources of referrals.  I take people in my industry (or related industries) to lunch.  I try to speak at events or take on leadership positions in local clubs, professional groups, etc.

Nobody is Coming to the Rescue

One of my mentors told me he used to keep a sign on his desk that said: “nobody is coming to the rescue (perhaps and old Brian Tracy line).”  In the early days of his business, with a family at home counting on him and little contacts starting out, he knew it was on him.  Indeed, nobody was coming to the rescue.

I find myself thinking about that line quite often.  During the times when I am sitting around waiting for the telephone to ring rather than working on activities that will increase the odds of that happening, I see the blunt truth in that statement.

If you have a few great clients, you can’t allow yourself to be complacent.  As they say, desperation is a bad cologne.  If you wait until you need to find new clients (because your old ones left), it may be too late.

At the same time, having a few pillar clients can’t hurt—–particularly in a volume business where there will be up and down months.  Some consistency can help a business stay the course during a rough patch.

I know two attorneys who specialized only in real estate transactions.  For twenty years, this was a successful and high-volume practice.  Both attorneys lost almost all their real estate business during the Recession.  The one attorney, however, did a little business law and had a few clients to help him weather the storm.  He now does business law and has switched his volume practice to bankruptcy work and real estate transaction.  The other attorney lost his business, worked a while for another firm, and finally retired earlier than he wished to.

Conclusion 

A lot of what I’ve written isn’t anything new.  It’s a matter of common sense.  But it’s also a common sense I have to constantly remind myself to follow.  I hope that, by bringing it to your attention, it helps some of you the way it always helps me in planning my business goals.

“Some debts are fun when you are acquiring them, but none are fun when you set about retiring them.” – Ogden Nash

We’re always told that all debt is bad debt. We all know that debt sucks. Then there are the contrarians that talk about good debt. Is there really a difference between the types of debt that you can have? Let’s begin this discussion about the possibility of good debt.

Let’s look at some traditional forms of “good” debt:

1. Education. An education is considered a good debt because you go to school to improve the rest of your life. You go to school to obtain an higher education so that you can make more money in the future and live a better lifestyle as you get older. You use student loans to pay for school because an education is too expensive and you need financial assistance.
2. Home Mortgage. A home mortgage is considered good debt because it has always been seen as an investment and the logical thing to do in your 20s. With housing prices being so high, we need a home mortgage loan to pay for the astronomical cost of home-ownership.

You could argue that those are forms of positive debt for some us. In fact, you’ll often hear many people preach about you need to borrow money to obtain an education or to buy a home.

The problem is that we’re all not logical about debt. Not all of us are rational when it comes to good and personal finance.

Can you really have good debt? I don’t think so.

There’s the obvious argument here. You can use debt as leverage. You can use debt to further yourself or to improve your current situation. You can use debt to get quicker results.

The problem is that you don’t need debt. You don’t have to use student loans to pay for your education. There are other options. You can work full-time, wait it out, avoid college, or use funding offered by your college. You also don’t need to use loans for a home because you don’t have to buy a home in your 20s. Buying a home isn’t the next thing to do after you get your first job.

The truth is that you don’t need debt at all. There are other options for you. You don’t have to borrow money to get ahead. You can call it good debt if you want, but you don’t need any debt. Therefore, debt is unnecessary.

What do you guys think? Do you believe in good debt?

“Never spend your money before you have it.” – Thomas Jefferson