Budget

Photo credit: http://www.bangitout.com

It’s always tough – but, good – to be first out of the gate (I imagine that’s a horse-racing term) … and, Ryan’s certainly taken the leap.

Love the image, Ryan!

One of the things that we’ll be exploring with Ryan as we go along is how best to commercialize his ‘new product’ idea: Ryan will (hopefully) learn a lot from us and we – in turn – will have the opportunity to learn about taking a new idea from start finish …

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The 7 MIT’s are finally wrapping up money making 101 (mm101) and moving on to the next step!

MM101 is mostly about getting out of debt and saving what you can, which is probably the most discussed, and published about step in the world of finance. But, hardly anyone talks about what to do once you’re out of debt and already saving. Even fewer still talk about the fact that being debt free and a having a savings account (or even stocks) does not mean you will be able to retire even at 65. The 7m7y community is dedicated to not just getting out of debt a la Dave Ramsey, or saving cash and mutual funds with Suze Orman, but to understanding what it takes to get rich(er) quick(er) in the real world and retire the way you want, when you want.

While I thought I was ready for the next step before I started this experiment, there are a few things I’ve learned so far that will likely prove to be invaluable.

First, I’ve set plenty of goals in the past, but the financial goals I’ve set have never been as specific as the ones I have now. Finding my “number” ($16 million in 8 years) was the single most important thing I’ve done so far. It’s not just about picking a number that you think will make you happy and a date to accomplish it by, it’s about picturing your retired life and everything you want it to be and KNOWING how much your dream will cost by the time you get there. It’s about finding your passion/purpose in life (mine is to build relationships that build dreams) and using it as a motivator and accelerator to your goal. It’s about knowing precisely what it’s going to take (like a compound growth rate of 82%!), and what types of investments can give you your needed growth rate (I’ve chosen starting a business with some intellectual property in the medical device arena) to get from where you are now (my net worth is $131,000 and you can see the details here) to where you NEED TO BE by your set date.

Second, based on my number and my date, I’ve learned that a 401K is not that important for me. Don’t get me wrong, I will always have a safety net to support my family in a dooms day scenario. But why invest my money in a vehicle that will only get me to a fraction of the number I need to retire and won’t even do that until well after I want to retire?

So now I feel like I have a solid foundation in mm101 and can’t wait for mm201 to get started.
I will be looking forward to working with the 7m7y community to help me get to my number and helping all of you get to yours.
I’ve already taken some of my ideas to a few engineers and surgeons to get feedback and will be going back to the drawing board to make adjustments. I’ll keep you posted on any news!