What’s important to you?
What’s your MRR?
Do you have a goal to develop Monthly Recurring Revenue?
Which would you say is more important
- The amount of money you earn or
- The type of money you earn
Growing, sticky, recurring income is far more valuable than many people realise.
Typically, what happens when you significantly increase your income?
In most countries, your average tax rate significantly increases. This means you retain proportionally less of the extra income you earn. Of the extra income you keep after-tax, there is a strong temptation to borrow more to finance a better lifestyle and/or to spend the extra income on overseas trips or other lifestyle-related items.
What happens if your income suddenly takes a dip while you are still responsible for paying your additional debt?
But, let’s say you are very disciplined, and you manage to save and invest most of your additional after-tax income that you are working so hard to achieve, and you don’t take on a large amount of additional debt.
Let’s say you invest in paying off the mortgage on your own home. Then you start investing in shares and property.
Let’s say you manage to save and invest one million dollars, and you settle for a safe return of 5% per annum. That would return you $50,000 per annum.
How long would it take you to save one million dollars if you saved, say, $30,000 per year out of your after-tax income? Roughly 30 years.
So after 30 years, you’ve paid off your house and have an income of $50,000 per annum. Is that enough to live the high life?
What else do you need to consider in your quest to earn additional income?
- Will you need to invest more hours in income-earning activities
- Will you have increased responsibility & stress?
- What’s your journey likely to look like while you are earning this additional income over the years
- Will you have the time to create memories, relationships and experiences with loved ones?
What if instead of focusing on earning additional income to invest in assets that can produce passive income, you focus on building assets that can produce ongoing Monthly Recurring Income?
How difficult would it be to develop a sticky, growing recurring income of at least $50,000 per annum from a business or as a strategic partner of other businesses?
Let’s say you decided that you would develop growing recurring income but NOT by having your own business. Instead, you would become a strategic partner of other businesses.
What would you have to bring to the table?
Growing a large team of team building advocates, you will discover many great opportunities for your strategic partners.
Many people go into business with great ideas and concepts. However, their business often fails. The reason for failure was not that their idea was not good enough. Instead, they failed because they did not have the network to help them make their ideas work. If you have the network, you can bring a precious asset indeed to the table.
Let’s say you start building a network with the primary goal of supporting your existing business. When you realise how much more can be done through the network, start thinking of other ways the network can help you generate MRR. Increasing MRR without increasing effort on your part means you have more free time and additional income.