I recently “listened” to a book with this title. I like to listen to audio books whilst I am driving– or rather not driving, often being stuck in traffic. Anyway, I would like to recommend this book to everyone. It is written by David Bach and is an absolute bestseller in the US. Although a lot of David Bach’s tips are very US-oriented (like the 10-step plan to improve your credit score), we can use most of his advice worldwide here and now.
The bottom line of David’s powerful message is this:
Most of us have suffered a financial hit during the recession. Although here in Holland we’ve not been hit as hard as in the US, the housing market has not exactly blossomed during the past year. Some of us have lost our jobs and many of us have lost part of our savings to banks like Icesave or DSB. Many stocks will have fallen in value, along with most pension plans and many mortgage savings accounts. All of these are related in one way or another to the stock market. So I think it is safe to assume that very few of us have really become richer these last two years. And although this may have discouraged people from saving or investing more money at this point in time, David’s message is that there has never been a better time to do so than now! His slogan is: Recessions Make Millionaires.
The reasoning behind this is as follows
- Houses are cheap at the moment (not as cheap here as in the US, but certainly not over priced at the moment).
- Home owners who are selling at the moment are very motivated to negotiate.
- Interest rates are low.
- Stock markets are low, a great time to get in.
“But”, many of us will say “it is hard enough to make ends meet, let alone having any money left to save or invest”. Well, here is David’s secret: “The Latte Factor®”. The Latte Factor® is based on the idea that all you need to do to get rich is to look at the little things you spend your money on every day. This could be a Latte on your way to work (koffie verkeerd in Dutch), your daily packet of cigarettes, fast food etc. Most of us just do not realize how much we spend on these little purchases every day. If you are able to change some of your daily habits, such as taking sandwiches to work, stopping smoking , taking public transport instead of a taxi etc. whilst keeping track of what you are saving and setting this aside, you will find that this can really make a difference to your future wealth.
You can start tomorrow by downloading the Latte Factor® Calculator on your I-pod or simply copying it into a note book. Track your expenses for a week or even a month. Use any money you have saved at the end of the month first of all to repay your credit card debts or other credit facilities. Once these are repaid, you can start saving cash in a special savings or investment account or alternatively add to your pension plan. I recommend you begin today by checking out David Bach’s website: finishrich.com/lattefactor. Give it a try!