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But of all the steps, this step is probably the most difficult to master if it is not already a part of your makeupI would venture to say that it is the lack of personal self-discipline that is the No1 delineating factor between the rich, the poor and the middle class Simply put, people who have low self-esteem and low tolerance for financial pressure can never, and I mean never, be richAs I have said, a lesson learned from my rich dad was that "the world will push you around The world pushes people around not because other people are bullies, but because the individual lacks internal control and disciplinePeople who lack internal fortitude often become victims of those who have self-discipline In the entrepreneur classes I teach, I constantly remind people to not focus on their product, service or widget, but to focus on developing management skillsThe three most important management skills necessary to start your own business are: 1Management of cash chanel wallet flowManagement of personal time I would say, the skills to manage these three apply to anything, not just entrepreneursThe three matter in the way you live your life as an individual, or as part of a family, a business, a charitable organization, a city or a nation Each of these skills is enhanced by the mastery of self disciplineI do not take the saying "pay yourself first" lightly The Richest Man in Babylon, by George Classen, is where the statement "pay yourself first" comes fromMillions of copies have been sold But while millions of people freely repeat that powerful statement, few follow the adviceAs I said, financial literacy allows one to read numbers, and numbers tell the story By looking at a person's income statement and balance sheet, I can readily see if people who spout the words "pay yourself first" actually practice what they preach A picture is worth a thousand words So let's again compare the financial statements of people who pay themselves first against someone tiffany jewellery who doesn't People who pay themselves first ------------------------ Job--------------->|Income |---- ^ |------------------------- | | | Expense | | ------------------------ | --------------------------------------< ---------|------------------------ | Assets | Liabilities | | | | |_________|____________| Someone who pays everyone else first- Often there is nothing left ------------------------ Job--------------->|Income | |------------------------- | Expense | ----> Nothing left! ------------------------ ----------------------------------- | Assets | Liabilities | | | | |_________|____________| Study the diagrams and notice if you can pick up some distinctions Again, it has to do with vintage omega watches understanding cash flow, which tells the storyMost people look at the numbers and miss the storyIf you can truly begin to understand the power of cash flow, you will soon realize what is wrong with the picture on the next page, or why 90 percent of most people work hard all their lives and need government support like Social Security when they are no longer able to work Do you see it? The diagram above reflects the actions of an individual who chooses to pay himself firstEach month, they allocate money to their asset column before they pay their monthly expensesAlthough millions of people have read Classen's book and understand the words "pay yourself first," in reality they pay themselves last Now I can hear the howls from those of you who sincerely believe in paying your bills firstAnd I can hear all the "responsible" people who pay their bills on timeI am not saying be irresponsible and not pay your billsAll I am saying is do what the book says, which is "pay yourself prada clutch first And the diagram above is the correct accounting picture of that actionNot the one that follows My wife and I have had many bookkeepers and accountants and bankers who have had a major problem with this way of looking at "pay yourself first The reason is that these financial professionals actually do what the masses do, which is pay themselves lastThey pay everyone else first There have been months in my life, when for whatever reason, cash flow was far less than my billsI still paid myself firstMy accountant and bookkeeper screamed in panic "They're going to come after youThe IRS is going to put you in jail "You're going to ruin your credit rating "They'll cut off the electricity I still paid myself firstBecause that's what the story The Richest Man In Babylon was all aboutThe power of self-discipline and the power of internal fortitude "Guts," in less elegant termsAs my rich dad taught me the first month I worked for him, most people allow the world to push them omega watch replica aro