How many times have you told yourself:
“If I had a million dollars… if I had a million dollars, I would do this.
If I had a million dollars, I would buy this.
If I had a million dollars, this is what my life would be.”?
Well, a lot of people ask themselves this question. You are hardly alone.
The problem is most people struggle because they remain in the asking stage. They only think about what would happen if they had a million dollars.
That’s pretty much the long and short of their analysis.
And this is why their lives don’t really change for the better as far as their finances go.
If you want to truly unlock the power of the phrase “If I had a million dollars”, you have to think about this concept the right way.
This is not pie in the sky. This is not you daydreaming.
You have to think strategically because what you focus on grows.
That’s right. Whatever your thoughts flow to eventually manifests itself.
The reason why so many people say life is hard and struggle financially is because they keep focusing on the fact that they are poor or they don’t have enough.
The more they focus on their problems, the bigger their problems get until they become paralyzed by their limitations.
They start defining themselves based on what they don’t have instead of what they’re capable of doing.
This is why it’s really important to tackle the question of “If I had a million dollars, what would I do?” the right way.
Learn how passive income works
Your first step should be to learn how passive income works.
Passive income involves creating an asset that you work on once.
Maybe you put in a day or two, but you end up with an asset. You then make money from that asset many times over.
- Maybe you create a book.
- Maybe you program software.
- Maybe you create some sort of downloadable content.
Whatever it is, you worked only once to produce it, but it has the possibility or potential of producing money many times over.
That is passive income.
So, I want you to understand how that works because your job, with a million dollars, is to invest in as many passive income assets as possible so you can live off the income they produce.
Learn how taxes work
If you’re unclear as to how taxes work, you’re going to be chasing your tail.
You have to know how taxes work and you have to know its impact on your ability to make your money grow.
This way, you can plan how much of your money you can reinvest into passive income assets.
This way, you would be able to keep enough money left over so you can pay the taxman at the end of the year.
Learn how living within one’s means work
When you were a college or high school student, you were probably able to live on very little.
I remember when I was in college, I used to eat only ramen. I would eat ramen on Monday and on Sunday.
In other words, I would eat ramen or instant noodles for the whole week.
And guess what. I was really happy.
It turns out that I could live off a few thousand dollars.
Now that you’ve graduated college and you’ve worked several jobs, you’re probably thinking to yourself, “Since I’m making all this money, I’m entitled to a much higher standard of living.”
That is where your problem begins.
You have to understand that the higher your income goes, the higher your cost of living gets.
They go hand in hand.
And the reason for this is because you feel you’re entitled to a higher standard of living.
In many cases, that standard is higher than your means.
So, if you are to flip this over and decide to live well below your means, you will have enough cash left over so you can buy or build passive income assets which can create income that you can reinvest again.
If you keep repeating this process, eventually, you can quit your job. How come?
All y our passive income assets are producing enough money with little effort on your part to sustain your lifestyle.
And you don’t feel like you’re poor.
You don’t feel like you’re left behind.
You don’t feel that you’re denying yourself.
People are able to pull this off.
In fact, in many cases, they have so many blogs and online resources and drop shipping websites that they can go on a vacation on a 365-day basis and not have to worry where their next meal is gonna come from.
A lot of these people even have many different houses all over the world.
This is not a fantasy and it’s certainly not scam. This is happening right here, right now.
And all it takes is the ability and the commitment to live within one’s means so you can reinvest in passive income assets.
Key steps for handling a $1,000,000 windfall
Going back to the central question of this post, if you had a million dollars, what would you do?
The first thing that you need to do is to pay taxes on that million-dollar windfall. You have to take care of taxes otherwise, you might end up in jail.
Second, you invest half of what’s leftover in passive income building.
There are many online passive income assets available on the internet.
Pick the right ones. Pick the ones that best fit your risk tolerance profile.
Once you got that out of the way, invest the other half in an IRA or 4O1 K. These are retirement funds.
You might also want to invest in some insurance. Once you do that, you have set yourself up.
Those passive income assets will start producing money month after month.
In fact, you should’ve bought assets that are already producing money.
So, once you bought those and they start making money every month, don’t say you don’t know what else to do.
You should definitely proceed with constantly reinvesting your passive income assets returns.
How do you do this?
You buy even more passive income assets and before you know it, that half a million dollars or $300,000 you invested in passive income assets quickly become 1 million.
And then 1 million quickly becomes 2 million.
And before you know it, it becomes 4 million and then 8 million. You know the drill.
That’s how passive income works. And with the importance of time added to it, it eventually grows and can grow really exponentially, if done right!
The best part? You don’t have to show up for work.
This is not active income. You’re living off the money that your money is making.
Isn’t that awesome?
Also See: How and Where to Rent a dress For a Wedding (Without Going Broke)