Can you remember back to buying your first lotto ticket? How about the time you kicked your first football? Or that day you started your first business?
I bet you had grand visions. Visions of winning big. In most cases, winning big included a large financial gain. You assumed that if you could just make that first million, your financial woes would be no more. Your wealth empire will be complete.
Yea, you wish buddy!
The average professional US athlete makes more in a single year than the majority of US citizens make in one year. Now that’s earning power.
However, 78% of NFL players, 60% of NBA players and a large percentage of MLB players (4x that of the ordinary citizen) file for bankruptcy within 5 years of retirement.
Michael Vick, Kenny Anderson, Lenny Dykstra, Lawrence Sprewell and Lawrence Taylor are just some examples. You can read more about their off-field troubles here – http://www.therichest.com/celebnetworth/athletes/athletes-bankrupt/.
Lotto winners have similar problems.
According to a 2010 study by researchers at Vanderbilt University, the University of Kentucky and the University of Pittsburgh, the more money you win in the lottery, the more likely you are to end up bankrupt within five years. Similar research from the National Endowment for Financial Education estimates that 70% of people who had unexpectedly come into large sums of money ended up broke within seven years.
Take Sharon Tirabassi for example. A single mother on welfare, she cashed a cheque from the Ontario Lottery and Gaming Corp. for $10,569,000 in 2004. Less than 10 years later, she was back riding the bus, working part-time and living in a rented house.
Here is a list of 18 others who blew their lottery winnings – http://www.businessinsider.com/17-lottery-winners-who-blew-it-all-2013-5?op=1
The reason these people go bankrupt is quite straightforward…they are financially illiterate. In fact, our education system is such that financial illiteracy continues to be a scourge with little being done to overcome it.
Let me ask you this question fellow entrepreneur. Apart from trying to earn more in your business, what else have you done to build your wealth empire?
Do you have an exit strategy in mind? Do you have budget plans? Do you have an investment strategy for the cash flow your successful business might generate?
Unfortunately, most don’t. Most put these issues on the back burner only to regret it later. If you can’t invest your proceeds wisely, you’re setting yourself up for failure. It won’t matter if your business generates $100 per month or $100,000 per month.
You see, there is a reason why the 1% are the 1%. It’s because they realise that building a wealth empire is not just about earning. It is about earning more than you spend. Then investing wisely. That takes time. It takes discipline. It takes commitment.
If you’re ready to step up, check out this free report I have just written – Solving the Wealth Equation.
James is a digital marketing consultant and online business strategist. He helps coaches, consultants, and solo professionals market their business online so they establish authority positioning and predictably generate 5-20 high-ticket, new clients every month.