How?

By stopping the income leaks that exists in your wallet.

When it comes down to it, there are basically 3 ways to make money. The first is the one that most people are familiar with, which is to earn it by trading your time and expertise for money. The second is to own assets that produce money for you automatically… like a book, real estate, or a business. The third is the easiest place to find money, yet often overlooked, which is to eliminate spending waste…

…which can be done without actually having to give anything up.

Sure you can save money by cutting off the cable and eating out less, but that’s no fun. Better yet, keep everything you have, but drastically reduce the amount you pay for it… especially the stuff you don’t enjoy paying for in the first place.

Here’s one quick, easy way to find hundreds of dollars in hidden cash in your wallet…

One of the biggest  household expenses is insurance. Every month (or year) you send a big fat check to a company that may never give you anything in return. Insurance is a very important thing to have, and its a good idea to have adequate insurance to protect your health, property and your money. But that doesn’t mean you have to pay premium prices to get great coverage.

With a quick search, you can compare rates from auto insurance providers and find the very best deal. Just enter your zip code in the “comparison search engine,” and you instantly have access to the cheapest rates in your area. In15-seconds you’ve found several hundred dollars in cash leaking from your bank account that you can instantly put an end to.

This is a money-saving exercise that most people “put off until tomorrow,” and the auto insurance companies are very happy if you do too. The average person spends about $1,900 a year on car insurance, but with a quick search you can find rates for as little as $27 a month (or just $324 a year). That’s a huge paycheck you can give yourself without having to give up anything in exchange. That amounts to about one half of a month’s pay to the average American worker.

$1,900
-$ 324
———
$1,500 in free cash

Don’t waste time calling around and getting stuck on the phone with an insurance salesman. InstantQuoteWizard.com quickly pulls up the rates in your area and shows you just how much money you can instantly stop from leaking out of your bank account. It’s a quick money making trick that will help you get your payments more in line with where they should be.

Start here…

• Interest on your mortgage. Let’s be honest–interest is pretty much all you’re paying for in the first few years of owning your home.  Of course, I doubt there’s even a chance you’d let this deduction slip by, so just consider it a friendly reminder and something to look forward to when preparing your taxes.
• Health insurance premiums and Health Savings Accounts (HSAs). This might not increase your tax return significantly, but it sure feels good to be able to deduct some of those expensive premiums we all have to pay for health care, particularly if you’re self-employed.  (Hint: if you are self-employed, you get to deduct more than the rest of us.)
• Student loan interest. That’s right.  Uncle Sam lets you deduct this one, too.  You should receive a statement from your bank come tax time to help you with this part, so be sure not to toss it aside or let it get lost!
• IRA contributions. This only applies to traditional IRAs.  You’re going to have to pay taxes on your withdrawals when you reach retirement age, so prior to that point in time, you get to deduct your contributions.  If you have a Roth, you don’t get to deduct, but you won’t have to pay any taxes on your withdrawals.
• Your home office. If you’re self-employed, don’t overlook this deduction.  However, do check into the specific restrictions to make sure you qualify.  For example, a room in your home that is purely used for your business counts as a home office.  Using the computer in the corner of your bedroom does not.  Once you’re certain you qualify, you can deduct not only the space itself, the mortgage/rent payment respective to it, electricity, etc., but you can also deduct your computer, business phone line, office supplies, etc.
• Charitable contributions. You probably already know this one, but did you know that it’s not just for monetary contributions anymore?  Did you donate some old clothes or used items to a place like Goodwill or your local church?  These can be deducted.  It’s best if you make sure to get some form of a receipt if possible.
• “Green” credit. If you recently renovated your home to be more energy-efficient and “green” or perhaps bought a qualifying fuel-saving, hybrid, or otherwise “green” car, the government will reward you with a tax deduction.

If you’re uncertain as to whether or not you qualify for these or any other deductions that you find, don’t be afraid to consult a tax advisor—you can deduct tax preparation services, too!  Home tax software such as TurboTax will help you catch deductions by asking you easy-to-follow questions.

The initial spark for health care reform appears to be the number of uninsured people living in America.  However, while there’s no denying that many are in fact uninsured, the number itself is up for debate.  Lately, it’s been proclaimed that 45 or 46 million Americans are uninsured.  I’m no politician or statistician, but that seems pretty hefty even to me.

How Many Are Uninsured?

First, the most recent survey conducted by the Census Bureau reports that 9.7 of that 46 million are not American citizens—another source of debate that we’ll get to momentarily.  Also, there’s always a margin of error with every survey.  Some people answer the questions asked of them honestly, some may have reported being uninsured that ended up becoming insured sometime after the survey, and others may have outright lied.

According to spectator.org, Blue Cross Blue Shield estimated in 2003 that of the reported uninsured population, 14 million were actually eligible for some form of health care including Medicaid.  18.3 million were under 34.  17.6 million were earning over $50,000 annually and 9.1 million were earning over $75,000 annually.  This leaves a high probability that some of these people could likely afford health care but chose not to buy it, perhaps believing that because of the high cost, they would do without while still young, healthy, and theoretically not in need.

From this entire study, Blue Cross determined that 8.2 million people were uninsured because they truly could not afford it, yet they earned just enough that they did not qualify for government assistance.  Granted, this was 2003—but could the true number of uninsured people jump to 46 million in 6 years, even with a recession?

Abortion Issues

The debate also seems to include some moral issues such as abortion and coverage to illegal immigrants.  Regarding abortion, the House bill has been reported to state that the government health care would have to provide one plan that covers abortion and one that does not.  Politicians are saying that people with the plan will not be paying for others’ abortions, yet every time it has been proposed to have this in writing, that version has been rejected.  No matter my or your stance on abortion, the constant waffling is what I find to be the absolute most frustrating part.

Coverage for Illegal Immigrants?

There is also no solid stance on whether illegal immigrants would be able to take part in the government health care.  Ann Coulter writes on her website that in Section 246 of the 1000-page bill, one sentence is devoted to this issue: “Nothing in this subtitle shall allow federal payments for affordability credits on behalf of individuals who are not lawfully present in the United States.”  At the same time, there is nothing requiring doctors or other persons providing the actual health care to validate citizenship.  You also run into the problem of the emergency room, where federal law requires that patients in need of immediate attention cannot be denied treatment due to lack of insurance.  Could/should medical staff be required to check citizenship in this situation?

Is the Public Option Really An Option?

Then we have the problem of the health care reform being referred to as the “public option” that doesn’t sound officially optional.  Obama has insisted that if you like your private insurance and your doctor that you may keep them both.  But an issue arises if your insurance is provided through your employer.  Employers would be given incentives to offer the government plan to their employees instead of a private plan.  I don’t know what those incentives would be, but if your employer makes the switch, you may have no choice, especially when it would likely be more expensive to keep your private insurer by yourself.

There’s talk that the House version of the bill would mandate all individuals to purchase health care or pay a penalty of 2.5% of their gross income.  So you’ll pay money for absolutely nothing until you can afford to purchase health care?  If you’re already struggling, I’m not convinced this will help anyone.  Ann Coulter also mentions that if you’re not paying either, you can be cited for tax evasion and thrown in jail.  I sure hope that’s not true, but it also makes me wonder how each and every person will actually be tracked down.  And if you’ll really be thrown in jail alongside burglars and murderers who truly deserve to be there, that’s extra tax dollars being used to fund now-overcrowded prisons.  (Oh, and if you’re a small business owner, you’d also be penalized if you don’t offer insurance to your employees.)

I don’t propose to know everything about the health care reform or to fully understand it.  There is so much out there about this subject and so many extremely strong opinions in both directions.  Pepper in the unclear nature of the bill itself in its current form and it becomes harder to decipher the truth.  Would government-provided health care be a good idea?  Obama mentions stretching out Medicare benefits to everyone in a way, but Medicare already seems to be struggling with reports of wasted dollars and impending cuts.

I believe that something does need to be done about health insurance, but I’m not sure a full government takeover is the answer, especially not in the form that it’s currently being presented.  I do agree that the “pre-existing condition” clause needs to be done away with, and that is supposedly in the bill somehow—illnesses and current health situations are the main reason people need insurance in the first place.  Perhaps simply regulating the cost of health care would be a better idea than creating an entire government health plan.  Let’s level the playing field so that an MRI no longer costs $100 at one place and $3000 at another, and the patient knows what they’re paying or what portion they’re ultimately responsible for from the get-go.

Or we could all just be included on the health care plan that Washington politicians get.  Apparently it’s the best one out there…

• Make a budget.  You knew this one was coming.  This is the best way to really manage your expenses.  Start with how much money you have coming in every month, then list your expenses.  Include all of your bills, of course, but don’t forget to account for your morning latte, monthly magazine, and Friday dinner with friends every week.
• Avoid spending money on things you don’t really need.  When you make your budget, you’ll see where you can, or should, cut back.  Stick to it.
• Avoid being charged pointless fees.  Try not to use ATMs if possible.  Make sure your bank or credit card company isn’t charging you unnecessary fees.  If they are, insist that they be removed.
• Set up a savings account with direct deposit.  This will help you easily set aside some extra money.  It’s important to pay yourself first, even if it’s only a few dollars.  And if it never passes through your fingers, you’ll never miss it—you’ll just instinctively budget around it.  Whether you use the savings as an emergency fund or an entertainment fund is up to you and your personal priorities.
• Use coupons and look for deals.  Shop generic when possible.  Do some “research” before leaving the house to go grocery or clothes shopping to figure out who has the cheapest price and/or is offering the best deal.
• Pack your own lunch and bring your own snacks to work.  It’s not only that $8 a day you’ve been spending on eating out that adds up, it’s also those 2 trips to the vending machine every day that cost you $0.75 at a crack.
• Patronize your local library.  You can check out books, movies (yes, current ones), and even your favorite magazine that you gave up to save money, all for free.
• Find new uses for old or broken items.  Use that old t-shirt for a rag, turn an old bucket into a planter, etc.  Or, invest in repairing items instead of buying new ones.
• Rotate your tires and get your oil changes on a regular basis.  Preventative maintenance is important—it prevents future, major maintenance!  Your tires and your engine will last longer.

I believe that budget is the most important and most effective way to start making your money last longer.  Do remember that all the little ways of saving will add up, though.  And promise yourself to maintain your good money habits even when the recession has officially ended.

Define Ultra Wealthy

First, you need to define ultra wealthy for yourself.  Do you agree that it means you are worth $30 million or more?  Is the title of billionaire the only acceptable definition?  Is it more simple, such as being able to pay your bills and have plenty leftover to play with?  Does it mean owning property on each side of the country or being able to retire very early?

Set Goals

This one is of utmost importance.  You need to set goals and you MUST write them down.  Don’t leave them floating in your head.  Either you’ll forget them or you’ll start to feel overwhelmed and wind up never reaching your goal.  Chalene Johnson, my favorite motivator, is constantly reminding people to work on their to-do lists.  She claims she is average in every way, but her ability to write down her goals and follow through sets her apart.

Take a few minutes to write down some goals for today, then for the week, the month, and the entire year.  Break down the large tasks (such as “Save $10,000 by the end of the year”) into smaller ones to tackle on your daily or weekly lists.  It will make them more realistic and tangible—you’ll know you’re making progress.  And you’re not too busy to do this—in fact, you’ll either learn that you’re not as busy as you think you are, or you’ll learn better time management.  I guarantee from personal experience that you will feel LESS stress.

Take Action

Now that you have your goals on paper, it’s time to DO SOMETHING.  You will not become ultra wealthy by reading your to-do list.  You have to take action.  When you know you have to accomplish something by the end of the day and it’s staring you down, you’ll actually look for ways to make sure you get it done.  There are few things as satisfying as crossing a goal off of your list.

Once you’re a few months (or maybe years) in, it will still be important to set and go after goals.  To remain ultra wealthy, you have to remain active.  If you started a business, you can delegate responsibilities as much as you want, but you need to know what’s going on and continue to be creative and find ways to keep things running smoothly or even improve.  If you invested your money, you need to stay educated on companies and trends and know what moves to make when.

Maintain Good Money Habits

According to Forbes.com, the main reason people fall off of the Billionaire list is death; the next reason is allowing too much debt to accumulate.  You can’t control the first one, but you can control the second one.  You do this by continuing to set goals, taking action, and maintaining good money habits.  The ultra wealthy who remain on these top lists know how to protect the money they’ve made.  When you reach this point (or even if you’re steadily on your way), your risk of a sudden and dramatic loss increases.  Make sure you have a few safe investments and/or savings set up to avoid this danger.

If you’re still in the “pondering” phase, you’re likely to talk yourself out of taking the first few steps.  There’s no doubt that it’s a little scary to start on such an ambitious path as becoming ultra wealthy.  But don’t let that fear of failure get in the way.  If you don’t write down your goals, break them down into easily digestible steps, and take action now, when will you?  Small steps and small savings are always a positive start.  Aim big, but don’t be afraid to start small.