Friday, May 12, 2006

 

A Late April Update

Wow, things have been busy.

Last months numbers (I did do them - just didn't quite get around to posting :)

Wealth this month: £94,615
Wealth increase this month: £1945
Additonal amount required: £905,385
Number of months until 40th Birthday: 100
Increase required per month: £9050
Company Assets: £31,909

Still not looking very impressive are they? Don't worry - I think we're on the way up! The new house is progressing, work is going soooo well - they just want me to add more and more to my workload:

Me: "It's going to cost you ...."
Them: "Well ...... lets talk"
Me:

I've also got a new website being built (no rubbish home grown stuff this time - proper job, graphic design - the lot) and a couple of high value prospects have come up through my own little network.

I'll try to post more often ..... I can almost smell the cash around the corner!

Thursday, March 23, 2006

 

March Update

Not been posting here much - mainly becuase things have been pretty hectic. Returning from holiday, family sickness and a huge workload for oneself and Mrs Potential Millionaire have all taken their toll. I've not had chance to think much about the contents of my last post - but the beauty of the blog is that post just sit there - public and demanding attention.

Anyway. March figures on the road to the magical million.

Wealth this month: £92,670
Wealth increase this month: £7346
Additonal amount required: £907,330
Number of months until 40th Birthday: 101
Increase required per month: £8983
Company Assets: £30,871

You'll see that the company assets have taken a bit of a kicking from the tax bill I had to pay. But what can you do? I'm working on building those up at the moment as March has been pretty busy for me (and you'll notice there are nearly five complete billable weeks in March :) )

Wealth is up mainly because we have sold our house, and for more than we were hoping, add to that the fact that we had paid off a bit more mortgage that we thought and we made quite a gain. Although of couse with every month that goes by the increase in monthly income creeps up and up.

Still, I'm looking forward to putting our head over the 100K mark! Maybe next month.

Sunday, March 05, 2006

 

Mid-month Update

Mixed feelings at the moment. I managed to bill pretty well for February seeing as I was away for a couple of weeks of it, but I also had a huge tax bill to pay and a lot of the bills from the holiday started to come through. Basically this means that the figures for the end of this month will be down and the pipeline figures for the company will be down too, which isn't very encouraging for you potential millionaire over here.

On the upside I have been thinking a lot about making the most of the work I can get and also rereading a book I read a little while ago. I applied the "rules" for a while with some success ) I got more responsibility and more money in a short space of time (Its all about confidence in yourself and the confidence of others in you) but I think I may have missed the point for my particular corner of my industry. I started to climb the ladder within one of my clients, where I should have been looking a lot wider. I work with clients, agencies, other IT professionals and nunerous hardware, software and services vendors. I should be climbing through the industry, not just within a simgle client. I'm going to give this some more thought.

Oh ... and I know its not technically mid-month, but I complete the spreadsheet around the third week of the month (before I draw cash from the company) so, in a way, this is my mid-month.

Friday, February 24, 2006

 
Back from holiday - more relaxed, browner, and ... erm .... poorer. Going away is definatly not good for your prospective millionaire!

Wealth this month: £85,324 (ish)
Wealth increase this month: -£5768
Additonal amount required: £914,616
Number of months until 40th Birthday: 102
Increase required per month: £8966
Company Assets: £45,626

I know what you're thinking - where the hell did I go on holiday to decrease my overall wealth by over five and a half grand? Well it wasn't all holiday you see, we're planning to move house and we had a bunch of people come and look at the place while we were away. Only one guy is close to making us an offer for the place and it looks like he'll offer five grand less than the valuation of the house. So our equity is reduced, and the bottom line is that we are set futher back from millionairehood!

On the positive side the company assets are significantly up. I had a ton of work to do last month and billed over and above the usual so the bank balance looks healthy.

Tuesday, February 07, 2006

 

Working is not enough

I've been looking at the spreadsheet - it's not good news.

Wealth this month: £91,000 (ish)
Wealth increase this month: £2410
Additonal amount required: £909,000
Number of months until 40th Birthday: 103
Increase required per month: £8825

That amount each month is too high, if I look through the spreadsheets for the last couple of years the average amount that our wealth increased by each month was only 1942 which is even worse. At that rate it would take me till my seventieth birthday to be a millionaire - and to be honest I dont want to wait that long, I don't think an old geezer in a sports car is the look I'm going for :)

So just working and doing the spreadsheet is not going to be enough (I can here the laughter from here you know - but this is a process, I make these discoveries so that you don't have to!)

So how do you make more money - consistently, every month, for the next 103 months to the tune of an additional 6415 per month? Good question, I guess if it was easy then we would all be doing it and I could just nip out to Waterstones and buy a book on it instead of sitting here writing this nonsense.

I think the trick is to not be overawed by the situation, I'm a logical bloke, been involved in lots of big projects. This isn't any different to any of those. If its a big problem then we can just break it down into managable chucks and deal with those one by one.

How do we get money?

1. Work for it
2. Inherit it
3. Return on investments
4. Steal it

Given that we don't want the plan to revolve around a stream of relatives keeling over in the next 103 months and that item 4. on the agenda has a certain amount of risk to it perhaps we should concentrate on items 1 and 3.

Dealing with the second these - return on investments is all well and good - but the investments need to be there to start with - to have a monthly return of £6415 per month from a regular savings account would require a capital sum of £1.5 million if we had that in the bank we wouldn't need to do any of this!

So investments have their place, but the cash to make the investments in the first place is key. So the bottom line is that we need to work for it. Kind of comforting in a way - isn't this how your parents told you it would be - work hard and you can have anything you like?

So there endeth this months lesson. You need to work for what you want.

The immediate impact of this for me is quite simple. I work freelance IT, I need to make sure I bill effectivly all the time I am in work and make the gaps between the work as sort as possible. Although it does give me a problem on the spreadsheet. Just because I take more money into the my limited company does not mean that it automatically comes to me for spending on gadgets - there are all sorts of tax implications for a start.

So I'll add a line to the spreadsheet - company assets. If working for a living is the way to become a millionaire then it has to come through this route (pipeline money if you like)

You want to know what the company's worth now don't you? Hmmm you are nosy! Ahhh, go on then .... company assets currently stands at .....drumroll .... £38,529.

I'm off on holiday for a couple of weeks. Lets have a look at all the numbers at the end of the month.

Wednesday, February 01, 2006

 

You can't Manage what you can't Measure

Someone once said that I think.

To this end I have a spreadsheet. To be honest its something I've been doing for a while, I;ve just adapted it so that I can track my progress towards a million.

I guess the problem is "How do you know when you're a millionaire?" I'm thinking that there are going to be no fanfares and dancing girls, no TV celebration and huge cake that are wheeled out when it occurs - its going to be up to me to know (and to plan the arrival of the dancing girls ;)

Hence the spreadsheet.

Quite simple really. First I list all the assets we have; bank accounts, savings, investments, value of the house, the value of the cars. Then we subtract all the debts; outstanding mortgage, loans, credit cards. The bottom line is "Wealth". Fantastic.

You wnat to know what the bottom line is now don't you?

Well here you go. Our total value in the world, if we sold evrything and paid everyone off would be 91,092 GB Pounds. Not bad huh, we're 9% of the way there already :)

Monday, January 30, 2006

 

Millionaire by Forty

Let me start by talking a bit about myself. I'm 31 years old, married with one son and I live in a small house in a commuter town just north of London in England. We have a good life style, I earn a good amount as a freelance IT consultant which means my wife doesn't have to work and we have a couple of nice holidays each year and two decent cars outside.

The thing thats begun to bug me is that I want to take the next step, I want to move up to the big league. I'm thinking large house, really good car, first class tickets and five star hotels. Well who doesn't hmmmmm?

I guess because I'm a practical guy I want to put some structure around this, it isn't good enough for me just to dream and hope, neither is it good enough to just buy a lottery ticket each week. If me and my family are going to be wealthy I want to plan it and set some goals. This has always been the way for me, I'm pretty good with money, I understand investment and financial products and we keep a track of the money we have. So this feels like the natural next step - once you have control over the money you can investigate how to get some more.

This all looks very materialistic reading back, and I suppose I'm at a time of life when material things mean a lot to me.

Believe me, when you look at the price of a house in the UK you need to focus on the practicalities of life a little.

So here is my pledge, my goal, my post-it on the fridge door; By my fourtieth birthday I will be a millionaire, be free to live the life I choose and to provide the best that I can for my family. And I'll write it down here, if thats OK by you?

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