I learned many lessons on the come-up that eventually helped me reach financial freedom for myself and my family. But here’s a secret no one will tell you… You DON’T have to learn them the hard way. In fact, I’m going to share 15 principles to create wealth, so you can get started NOW!
There are two ways people learn…
- Through experience
- By following the successful actions of others
In my opinion, the latter method is smarter and much easier.
When I was a young man on the come-up, I scoured all my resources to find out how the super-wealthy did it…
BUT, I FOUND NOTHING.
For that reason, I am giving you young hustlers out there my 15 best pieces of advice.
Why?
BECAUSE THERE IS ENOUGH MONEY AND SUCCESS IN THE WORLD FOR EVERYONE TO BE FINANCIALLY FREE.
Also, I have to disclose this information since I know how many people it can help.
So if you’re ready, these are the rules you need to follow on the come-up to get to the top…
15 Non-Negotiables on the Come-Up
I hate to tell you that if you were looking for a shortcut, that’s not what you’ll find here…
Yes, following my advice on the come-up will make things smoother on the road to success. But at the same time, these rules are non-negotiable and take a lot of discipline.
The good news is they will become more natural as you practice them.
You’ll see that the first rule to follow is number one for a reason…
Never Spend More Than You Earn
Now, I’m not saying you shouldn’t get loans or credit cards. Using debt the right way can be a great tool to create wealth
WHAT I’M TALKING ABOUT IS EARNED INCOME, AKA MONEY YOU TRADED TIME FOR.
Spending more than what is coming in is an obvious mistake. It’s how many people get caught in the middle-class trap.
Another point I want to note — especially for those on commission — never count money as revenue until it is in your account.
There is nothing worse than spending against what you think is coming in, then the deal falls through.
Next, let’s move on to what you should and should not buy on the come-up…
Don’t Buy It UNLESS You Can Write It Off
On top of not spending more than you earn, don’t buy ANYTHING that isn’t tax deductible.
For example, I can’t write off taking my wife to a nice restaurant for dinner…
But, I can write off that meal if I invite a couple of prospective clients.
See what I’m doing?
THIS KIND OF RESOURCEFULNESS WILL AID YOU TREMENDOUSLY ON THE COME-UP.
Until you are financially stable, there is no reason for spending where there is no tax break — outside your costs of living, of course.
And speaking of which, do you even know what your cost of living is?
ALWAYS Know Your Cost of Living — Not Just on the Come Up
It will never cease to amaze me how many people don’t know what their living expenses are…
HOW CAN YOU EXPECT TO BE IN CONTROL OF YOUR FINANCES IF YOU DON’T KNOW THE CONDITION THEY ARE IN?
You need to know your cost of living down to the nickel to create wealth. This applies even after you have achieved financial certainty, by the way.
I encourage you to sit down with your bank statements, credit card bills, etc., and get 100% clear on this vital number. And see if there are any places you can cut the fat while you’re at it.
As for the following non-negotiable, it may be more difficult if you’re soft-hearted…
NEVER LOAN MONEY
While you are on the come-up don’t lend money to anyone, under any circumstances.
That includes your best friend…
It also means your favorite cousin…
Yes, this rule even applies to your mom!
I understand that you want to help others, but you’re not stable enough when you’re getting on your feet.
At the same time, lending money can strain even the best relationships. Take it from me, I have only made this mistake a couple of times…
And it was a disaster every time.
You’re not a bank, but that doesn’t mean you shouldn’t invest.
Only Invest in Cash-Flowing Assets
Warren Buffett is famous for his number one rule for investing…
NEVER LOSE MONEY!
Right now, you’re probably thinking that is impossible. But with enough due diligence and the right vehicle, it is not only possible but you can repeat the process.
The key to making this work is to make investments that produce passive income.
For me, that means having a large portfolio of multifamily real estate because the rent checks come in every month.
The point is that the come-up is not the time to play games with your capital, which brings us to the sixth point…
Don’t Gamble with Money
I am not going to spend too much time on this piece of advice because it’s self-explanatory.
IF YOU ARE BUILDING WEALTH, YOU CAN’T AFFORD TO RISK YOUR CASH.
Who are you trying to impress? You’re on the come-up, not a high-roller. Gambling in any form is equivalent to throwing your money away.
There are other things besides currency that you can gamble with for your poker night if you have to…
Just leave your dead presidents at home.
Limit ALL Spending to Passive Income
Earlier, we discussed not spending more than you earn. Now, we are going to take it a step further…
ONLY SPEND IF IT CAN BE BOUGHT WITH PASSIVE INCOME.
This is one of the few money rules that gets harder the more you earn.
As you start making bank and growing your reserves, it becomes tempting to treat yourself…
DON’T TAKE THE BAIT!
Savings and earned income are exclusively for investments and the cost of living.
You need to pay the price on the come-up so you can pay any price later. And if you’ve been heeding my advice, tip number eight won’t sting so bad.
Pay Off Credit Cards EVERY Month
I said before that there are ways to use debt as a tool to reach your financial goals. One of the ways I do this is by using credit cards to organize my finances.
It is very simple…
One card is for personal expenses…
Another credit card is used for anything related to my business…
And, I pay them off each month so I don’t rack up interest.
This method keeps everything neat for me and my accountant when tax time comes around, and I can see my finances at a glance.
IN THIS WAY, CREDIT CARDS BECOME MY FREE ACCOUNTING SERVICE.
The interest and only making partial payments is how people get into trouble, so don’t use them how everyone else does.
My following point also goes against what many of you have been taught…
Rent, Don’t Buy on the Come-Up
For a long time, the American dream included owning a home. Despite this, I am going to tell you NOT to buy a house.
Contrary to what your parents have taught you, a single-family home isn’t an asset. It’s more of a liability.
This can be illustrated by the fact that when you own a house, you are on the hook for:
- All maintenance and repairs
- Long-term commitment to a location
- High property taxes
These are all things that will impact you negatively on the come-up.
After all, you don’t need to own where you live, you just need to use it…
Quit Buying “Stuff” on the Come-Up
To continue the theme of becoming more disciplined in your spending, you don’t need to buy extraneous “stuff.”
I’M TALKING ABOUT DESIGNER CLOTHES, LUXURY CARS, NICE VACATIONS, ETC.
Going back to our prior example, it’s one thing to take a client out to dinner. There is a possible return on investment there.
However, you don’t need to eat steak dinners on the town for yourself…
Keep your life minimalist as possible as you are on your way up. I’m not saying to be a cheapskate, but be aware of what is necessary and what is not.
Don’t Give Your Kids “Allowances”
This piece only applies to parents and those raising children. But, is completely unnecessary is paying your kids an allowance.
WHAT DO YOU THINK YOU ARE TEACHING KIDS WHEN YOU PAY THEM FOR NOT WORKING?
My daughters do not receive an allowance. Nonetheless, that doesn’t mean they don’t get things in exchange for the work they do.
This is not only a practice that helps your bank account, but it also teaches the kids in your life work ethic.
Never Mix Your Business and Personal Accounts
Twelfth on my must-know money advice list is to keep your business and personal accounts completely separate.
The reason behind this is that once you start taking from one to feed the other, there is a domino effect…
You start paying personal bills from the corporate accounts…
Then, you start paying from the savings to cover what you took…
In the end, it’s a big mess and you just are constantly “catching up.”
I don’t know about you, but that doesn’t sound like freedom to me.
You’ll never have to break the vicious cycle if you never get into it in the first place…
Keep Separate Accounts from Your Spouse
I want to start by saying that having a bank account independent from your spouse does not mean you distrust them.
Still, having your finances separated keeps you and your spouse accountable. It prevents you from relying on your significant other’s finances.
IN THIS CASE, WHAT’S YOURS IS YOURS AND WHAT’S THEIRS IS THEIRS.
As such, there is no reason to have fights about money in the first place. And if things don’t work out, it’s a clean break.
Not that you want that to happen, but you need to protect yourself — especially in the come-up…
Don’t Partner with People Who REFUSE to Talk About Money
If you grew up like I did, you were probably taught that it was rude or in bad taste to talk about money.
YOU HAVE TO VEHEMENTLY REFUSE THIS CONCEPT TO BE SUCCESSFUL.
You must consider someone refusing to talk about their financial situation as a red flag. You have to wonder…
Why won’t they talk about it?
What do they have to hide?
Do they even know what is going on with their capital?
Personally, I don’t do business with anyone who isn’t transparent about their money. Because more than likely, they won’t be straightforward with your partnership either.
Avoid People with Financial Problems — Especially on the Come Up
My last piece of advice for you on the come-up is to avoid those who are always having money problems — like the plague.
The reason for this is that their issues will somehow transfer to you like germs if you hang around them too long.
I can’t exactly explain this phenomenon, but I’ve seen it happen too many times to have you risk it.
YOU’RE REACHING UP, REMEMBER?
You are trying to create wealth, not stay on the come-up…
Don’t Be on the Come Up FOREVER
Ultimately, these 15 core pieces of advice are so one day, you’re no longer on the come-up.
Better yet, follow these guidelines long enough, and you can start breaking these rules…
That’s when you know you’ve succeeded and can provide for yourself as well as your family well into the future.
Just gotta put in the work and exercise control FIRST.
Be Great,
Grant Cardone
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