Leverage Makes Time Money Freedom Possible

So what's leverage? A simple example of leverage is a crowbar or lever you or a thief might use to pry something open or move a tree stump. It's a simple device that gives you far more power than you would have without it.

Leverage at a Job  (you have none)

When you have a job, you are there by yourself. You have no power other than you being physically present for x amount of time. You earn money in a linear fashion. That is 8 hours x 5 days = 40 hours. You get paid x$ for every hour you work. If you don't work, you don't get paid unless you have sick time but even that runs out. This lack of leverage often applies to self employed people as well as employees. The only real difference is that the self employed person has difficulty complaining to "the boss" about his lousy job. In addition, a 40 hour week can look like a vacation compared to the 60-70 hours a week his "new boss" lets him or her work.

Investors Leverage Money

Money managers, financial people and professional investors leverage their own or other peoples' money to earn more money. They earn money on the spread, between different rates of return, between interest rates, on stocks, bonds and other paper money. Often they invest in growth companies after they have done intensive research into the company and the market and sometimes receive excellent rates of return for their efforts. Sometimes its high risk and they get paid accordingly. It takes a lot of time, effort and know how to be good at this form of money making. It's not for the newbie and it does require money. Lots of it. It's not gambling on penny stocks or buying the latest glamorous stock. The golden rule is only invest with money you won't miss or can afford to lose. In other words, don't bet the house.

Real estate investors will often buy commercial properties or apartment buildings with rents offsetting the mortgage , taxes and repairs. As the debt is retired, more of the income becomes part of the asset column providing a good source of residual or passive income otherwise known as beach money.

Rock stars, movie stars and authors leverage their art. If rock starts, movie stars aand writers could not record their work, they'd be just working stiffs like the rest of us. It's the fact that their product can be copied and sold a zillion times over that makes them the big money. So they benefit big time because of technology. It also doesn't hurt that a huge industry has grown on these technologies which will, no doubt, perpetuate the income streams.

Traditional Business Owners Leverage People

A business owner often hires people for certain jobs that need to be done to generate the work or sales it takes to make the gross income for the company. Usually the more employees a company has the greater the gross sales and the greater the net profit. This net profit is generated by the work of all the employees but it flows into only one pocket and that belongs to the owner. As long as the employees keep the work up and as long as the boss is making sure the company is profitable, the money keeps flowing in. If a businessman is smart, he will organize the company in a systemized fashion where he is not really needed every single day. This means he can play golf and go to these far off so called business meetings to have fun. Of course, this all depends on finding and keeping good employees. That can take a while and good employees can be very difficult to replace. There is a huge upside. For every employee a business owner hires he receives 40 hours work. If he has 25 employees, this works out to 1000 hours per week or 50,000 hours per year . That's 25 years of work for one person: that's leverage.This is why John Paul Getty, one of the richest men in America at one time, is often quoted as saying, he ..."would rather have !% of the efforts of a hundred people rather than 100% of his own efforts". This multiplier effect can result in huge profits for shareholders and huge incomes for business owners.

Network Marketing Business Owners

This is a subset of the business owners section but there are significant differences. Some of the key differences are that you can become a business owner for next to nothing-- often less than $500, you can start part time and your income potential is beyond multiplication----it's in the biological growth arena. Everybody in the organization has as much potential to gain as the traditional boss in the conventional business except he doesn't have the employees or anywhere near the overhead a traditional business has. This why the pursuit of "beach money" is such a wise investment of your time and resources. You end up with "uncommon freedom":  time and money. Where's the beach?