If you fail to plan, you plan to fail.
A man…a plan…profit!!
Well, that’s oversimplying things very broadly…but there’s some elements of truths in there if you want to
- get rich
- retire early
- and do shit you love
There’s one big missing segment there though, which is “do-do-do-refine-reinvest”, so it looks more like this
But today, I’m only gonna talk about the Plan part.
Importance of planning
To be effective and maximize potential, you will need to have a plan and work towards the goal and mission. For example, my personal and nigelchua.com’s goal, to build as much passive income streams as possible. The question is to know or find out what is relevant OR NOT.
Planning is about what steps you need to take to reach the goals you want, what possible challenges and problems to anticipate and overcome, how to use your resources (skills, finance, time and opportunities) to reach the goal you want. Planning involves analysis of resources and trends, predicting emerging markets and future demands.
Basically, a goal is where YOU want to be at a certain time and the plan provides the roadmap and directions how you’re getting there.
That’s the reason why there’s the famous slogan “if you fail to plan, you plan to fail” – planning is a basic, basic, basic part of achieving any outcome you desire. It’s the blueprint that will organize, direct and guide your decision making.
For example if I set a goal to build passive income of $10,000.00 a month by 50 years old, and that’d be my guide to think and pick passive income investments and businesses from now (40 years old) till I’m 50.
Planning as a qualifying (and commitment) filter
Planning works as a filter for people to determine
- level of commitment they can commit to the plan and outcome
- flexibility and hunger to grow, learn and refine
- patience to see the plan through
- your decision making ability will show as well…
Basically, once you start planning and putting your ideas to paper, it’d show if your ideas are good or not, if it’s realistic or not…or if you’re committed, or not.
Kinda like getting and staying happily in love and married.
A lot of people jump from marriage to marriage or relationship to relationship at the first sign of trouble, because they want things easy; and they’re not ready or mature enough to work through hurdles along the way. There is no such thing as walk-in-the-park with no problems. I say this specificly to the people I’d met who wanted to work with me, but quickly threw me under the bus when we hit some road bumps. Aka “it’s always someone elses fault or problem”.
It was painful then, but those were great lessons for me in filtering and choosing people who are worthy, but also, qualified my goals and dreams.
My $10,000/month passive income goal
The number that I pulled up for $10,000/month passive income as my goal, isn’t an arbritary number. I went to the drawing board to determine and decide what’s my expenses, and additional buffers.
At this point in time, my family monthly expenses are crossing $14K/month, but that’s including mortgage and insurance, which will taper off after about 10 years. Personally we do not spend more than $6-7K/month right now, but that amount may change as the kids grow older so we buffered out mortgage/insurance and buffered in additional spending as we and kids grow older.
I calculated my financial independence based on 45 if all the ducks line up well for my high-risk-high-return investments; but failing which (or delayed), then the steady business and dividend stocks will (must!) achieve my passive income goal for me by 50.
And the way I’m doing it is:
- earn more**
- save more
- invest 75% of savings into dividend stocks; 25% into high-risk-high-return stuff
I spend most time at the ** earning more phase, because there is no limit as to how much any business or entrepreneurship ventures can earn, And keep looking for better and better solutions that can serve my passive income goals.
How bout you? What’s your plan?
I’m the founder and writer here at NigelChua.com; as well as serial entrepreneur, therapy business entrepreneur, digital entrepreneur, investor and also happy husband, father and Christian.
Started and sold off a business for 7-figures; built another 7-figure one and growing it further, plus building/investing into other businesses and investments as well as advisory works.
Nowadays I share and teach entrepreneurship, financial independence, retiring early as well as building and living a life you love.