In this article, Jake & I are going to talk about the four phases to achieving Financial Freedom.
Now, it’s much easier to look back and discuss the journey once you’ve already done it, but for many of you out there, you may be just getting started on your path to Financial Freedom. Jake & I started out with humble beginnings, a drug rep (Jake) and a pizza guy (Gino). We partnered up in 2011, and in 2013, we bought our first multifamily property. Since then, we have been able to acquire over $100,000,000 in assets, and create dozens of streams of revenue for ourselves.
So, life is changed quite a bit for us. And we feel that it’s our duty to share our story with you and how we got there. One of the main reasons for our success is Clarity. Clarity allowed us to focus on one investment niche, learn the niche like an expert, and continue to improve on our skills, while staying focused and not being tempted by the shiny objects.
Phase 1: Decide & Prepare
This first phase may be the most difficult. It’s all about you. You need to decide and prepare. That was a huge challenge for me. I was working in the grind at the restaurant. I was working in my business and not on my business, until I picked up the book EMyth, by Michael Gerber, and that changed everything for me. I followed that book up with T Harv Eker’s Secrets of The Millionaire Mind, and that changed my view of money and success forever. Click HERE to listen to our podcast with T Harv Eker.
The show is about finding success by having the “right vehicle,” the “right knowledge” and the “right you” to go all the way. It’s about legitimately changing how you were taught to think and knowing that you SHOULD give yourself more by getting rich. We dive in deep to the core of how mindset affects the person and spurs them forward or holds them back. This is a deeply affecting episode that will help you examine your limiting beliefs and re-condition yourself to step on the gas pedal on your path to financial freedom! It was an honor to podcast a person who I admired as a mentor and who inspired me to make the changes in my life to become financially independent.
Now back to the first phase one. What did that first phase look like for me? It looked like taking massive education, and starting to learn all about investing. It’s very important in this phase to realize that your personal financial statement becomes your report card. You have to get your expenses in order, your income in order, and begin to create a budget for yourself. You also create what we call a Financial Freedom Account (FFA), and you are going to start putting in 10% of your income to save to start purchasing assets.
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Next, you create a saving account for emergency so you have money allocated on the side if an unexpected expense occurs. Finally, you are going to create a savings account and allocate three to six months of savings that comprise of your living expenses. You never know when a pandemic is going to pop up and create a massive disruption in your life.
We like to refer to the phase one as “burning the ships” phase. There is no turning back to your old life, and you are preparing yourself for the massive amount of work and energy needed to get to the next phase. You are shifting from a scarcity mind-set to a mind-set of abundance.
Phase 2: Achieve Financial Freedom
Phase two is where you’ve actually achieved “Financial Freedom”, where your passive income is greater than your total monthly expense expenses. This is another scary phase because now is the time to decide whether to continue with your job full-time or cut the cord and become a full-time investor. I decided to wean myself slowly in this phase. I continued to work at the restaurant part-time while focusing the majority of my efforts full-time into real estate. My wife was NOT a happy camper for those six months of eighty hour work weeks, but it only proved to us that I could ultimately leave the restaurant and pursue my passion.
In phase two, you need to become disciplined with your time and begin to focus your efforts on revenue generating tasks, while continuing to educate yourself on building a business and learning to implement systems. You begin to view business as scalable, and start to leverage other people’s money, time and resources much better. You are no longer a one man or woman show. By the way, this was my favorite phase. I felt alive, and I was accomplishing new tasks and continuing to push myself beyond my comfort zone. I was shattering my limiting beliefs and proving to myself that with patience and persistence, I could achieve anything.
Phase 3: Abundance
In phase three, all of a sudden all of the effort that you have put towards your goal begin to materialize and you start to attract abundance in your life. True abundance, in the sense that if you want to go out and spend $100,000 on a car, that’s not a problem. You still feel the urge to stick to your budget, but your daily worry of money begins to fade away and you begin to truly adopt the go giver mentality. Listen to our podcast with the ultimate go giver Bob Burg:
We call this the snowball phase. All of a sudden, we turn around and notice that we’ve created multiple businesses, and we have multiple streams of revenue flowing in from those businesses, and our urge is to continue to reinvest the money into our businesses. We realize that to become successful is to adopt the long game mind-set in this phase.
Phase 3 is an exciting time in your life because you’re learning about yourself, and you are getting accustomed to trusting other team members and being able to recognize people’s strengths and what jobs they should be focusing on. As we like to say in the life coaching world, you are resonating at a high level of anabolic energy, and are able to create opportunities out of problems. You realize that money is just a tool to use to either invest in additional streams of revenue, or to enjoy. It is not used to hoard and to “save” for a rainy day. You use money to make it rain for you!
Phase 4: Super Wealthy
The streams of revenue have turned into raging rivers, and money has turned into a fun game. You want to go out and buy a jet. You want to go out and buy a yacht. Go ahead, nothing is stopping you from acquiring material possessions. You have learned the art of creating businesses that provide tremendous value to their customers, and you are reaping the financial rewards!
Now, the question is, what phase do you see yourself trying to achieve? There is no right or wrong phase, the only mistake would be not to decide and begin your journey to financial freedom. Ironically enough, in my experience, as you move through the phases, making money becomes less of a concern, and providing value and solutions are the main focus. A person who is financially challenged is always focused on making money to pay the bills, while a person who is financially free concerns himself with earning money, but begins to have a higher calling for their life, and begin to moves towards their soul purpose, which has been all made possible because they achieved financial freedom.
At Jake & Gino, our mission is to bring about a financial revolution through education because we know that:
People with financial intelligence can change the world for the better!
Where do you see yourself in the next five years? Now is the time to decide!
Jake & Gino