Let's begin this lesson with a definition of the term "Virtual Millionaire". This is an expression, known to the CPAs, but unknown to the general public. Why? It's because the bank does not want you to know. Here is why...
Virtual Millionaire - An individual that has zero debt and a passive or near passive income of at least 60,000 a year.
For example, if you had $2,000,000 in the bank earning 6% interest, you would have $120,000 of yearly income. This income is known as "PASSIVE" income. It is called passive because you weren't active I the production of this income. In other words, you did not work to get it. Yes, you worked to save the $2,000,000, but the income from the $2,000,000 keeps coming in without work.
A person with $2,000,000 in the bank could spend 6 months traveling the world and they would still make $120,000 each and every year and still have their $2,000,000 in the bank.
Before developing this further, there is one other critical point to make. Most folks have ZERO concepts of millionaire and their lifestyles. If you were a retired multimillionaires with $2,000,000 in the bank and this money was your entire life savings, would you spend your $120,000 yearly income and ALSO spend part of the $2,000,000?
If you are like most folks, you might have the conception that millionaires that spend money hand over first as if there no limit to how much they could spend!
The person with the $2,000,000 in the bank knows that if they spend more than their $120,000 income, next year they won't have $2,000,000 to produce an income for future years. It will be less. Guess what? If they don't have $2,000,000 to produce income, then they will no longer have the $120,000 in income, unless the interest rate goes up.
For some time, I tried to get my mind around this while concept of wealth as it relate to quality of life. I have determined, without question, that it isn't having an immerse amount of money to throw away that provides a high quality of life. It is known that you would always have a very good income and that you could virtually anything you would ever want to do with your time and your life that produces the very highest quality of life (This doesn't take into account spiritual or health issues.)
My friends, that is true wealth, or as a mentioned in the introduction, this is "Financial Wellness". In my previous experience with my wealthy clients, I didn't appreciate the fact that multimillionaires, for the most part, don't spend all that much money in a year. Their FREEDOM come and go almost at will has a near- magical impact on quality of life. That's really living "Well".
Based on my observations and experiences of working with the wealthy, I made a decision to focus my Business in a different direction. I decide that I would pursue the creation of passive. "INCOME", not the Creation of wealth or "Assets".
You see ? if you can produce $60,000 in a year in dependable passive income, this would be the equivalent of having $1,000,000 in the bank at 6%.
I determined that it would be much easier to create the lifestyle of a millionaire by focusing on creating income. So, I have done my best to become an expert in this very different way of thinking about the financial independence.
There are four ways to achieve financial independence. There is the traditional way, which is to work and save in a attempt to accumulate assets that will one day take care of your income needs. Some inherit it from someone else. A handful will win the lottery. And, finally the Virtual millionaire or "income" approach.
I want to suggest to you that the Virtual millionaire approach is not only far easier, but much more enjoyable in the process.
Consider this for a moment. If you are going to stay in the traditional way of thinking about financial independence, recognize that as folks work and save, they far too frequently deprive themselves of enjoying their
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