Financial Baseline:

The Race to 2010 is closing in a bit as we now are down to the dying days of June, and so the next phase in terms of building your new revenue stream or business is becoming more relevant and significant.

Now the point of the Race is to take people from any walk of life that isn’t a millionaire and help them to reach millionaire status by September 1st, 2010. That’s the whole point of the exercise, and of course helping you to make that leap in fully legal, responsible and realistic ways.

So last time out I had you look at your skills baseline – this was to help you identify and start ruminating about some of the things you’re best at, and where you might need a little extra help to reach your goals.

This time out I’m doing the same thing, but from a financial point of view. Today we’re going to take a look at your Financial Baseline and see what your starting point is. Taking a recap of this a year from now should make a big difference in your life and the lives of your family and friends as well, not just because we certainly hope you’ll be in a much better financial situation, but because you will be able to clearly see how your step by step growth has progressed and brought you the success you’ve always wanted. The feeling of accomplishment when you reach your goal will be worth every ounce of sweat.

But for all of that to be relevant, we need to have a really honest look at what your financial baseline is *today.*


Today we’re only looking at what your real, usable resources are on relatively short notice. Sure, if you really wanted to you could try and yard sale or E-Bay the entire contents of your home, but it’s not a reasonable proposition, and you’d probably end up losing too much value on your possessions because of your need to sell exceeding your customers’ need to buy.

So financially here we’re looking for different things. One thing that may surprise you is how much you can actually accomplish with only a few bucks. To give you some inspiration, here are a few things you can do that will provide you with your own product to sell for less than $200.00 (I’m assuming here you have access to a fairly current computer and basic transportation of some kind at least. If not, that may add a bit to your cost out the door.):

a) Publish a book through a print-on-demand publisher for $50 and have your book sold on Amazon, Barnes and Noble, and half-a-dozen other key book-sellers’ sites. It can even be someone else’s book that you have the license to publish and you just publish it and promote it, taking a share of the royalties.
b) Build an online radio station. Some legitimate licenses for prerecorded music can be as little as $75 a year and a lot of the software you might need is available legally for free online as shareware. As you sell advertising and gain listeners you can afford to upgrade later. But product out the door is available pretty darn cheap, especially for talk radio.
c) Design How-To-DVDs and CD-ROMs and sell them through your own website.
d) Start an electronic magazine.
e) Do event photography at clubs and social events, posting the pictures in low-res online and offering to sell the good quality photo prints to the people in the picture for $5-$10 each by promotion at the venues to your website the way they do on cruise ships.
f) Start a residential cleaning company. Sounds odd, right? I have a friend who built her home cleaning business into a multi-million dollar business in a little over a year and a half. It made so much money she closed her primary (profitable) business of fashion design in order to focus strictly on the cleaning business.

There are literally hundreds of ideas to fit low budget start ups like these, and the only primary advantage that higher amounts of financial resources offer you is the advantage of greater flexibility or choice.

In the final analysis, does it really matter as long as you are doing something you love and are getting richly rewarded for it?



Now your financial resources do give you options and choices, so there is a very real, and very good reason to take a look at what your resources are before you get going, and more than just to set a baseline for future comparison.

It also should help to make you honestly aware of whatever liabilities you currently face and probably will face over the coming year. Being aware of the liabilities is important because it gives you the heads up you need to be able to plan on how to deal with them, but plans are only good if you get a chance to implement them. If you don’t do anything with plans, all you have is a wasted sheet of paper.

Let’s get started shall we?


Ok so I’m going to break this next part up in sections to make it easier to put them together and get some indicators out of it. For the purposes of the baseline I’m going to put things in a range of 1-100, with 1 being ‘awe-inspiringly bad’ and 100 being ‘so good you shouldn’t be on this list.’ Once you’ve done all this in subjective numbers, I’d really very strongly recommend that sooner or later you go back through and do this with live dollars-and-cents amounts. It’s very telling to see the difference between where we think we are, and where we *really* are in real dollars.

Current Assets:

Cash:
Savings:
Convertible Bonds:
Accounts Receivable (people who owe YOU money):
Saleable Inventory (Stuff you already have that you could sell quickly):
Bonds:
Stocks (share certificates):
Mutual Fund Investment Assets (Not your retirement savings plan version – just straight investment stuff here.):
Other Soft Assets (easily sellable):

*Total Current Assets*:

Current assets are all those things that you can very quickly turn into cash (without owing anybody anything afterwards). Hopefully this is the pool of assets that you’re working with for the Race.

Capital Assets:

Vehicles:
Your Home:
Major Tools:
Other Hard Assets (harder/longer to sell):

*Total Capital Assets*:

Now lawyers are going to complain and whine that my distribution of current assets and capital assets doesn’t meet their definition, and probably not the definitions of the tax code, and you know what? That’s fine by me. What we’re looking for here is what you can reasonably get in straight cash value when you sell whatever you have. Notice I did not include household goods, your family jewels, whatever you can sell in a family bake sale, and definitely not whatever’s stuffed away in your garage. Later when we get really technical we can use the specific language that the beagles and the bean counters worry about instead.

So if you take a look at those ratings you gave yourself for the total current assets and total capital assets then you should have a reasonably good idea of what you actually own and can get your hands on if you needed to.

Next up we’re going to take a look at what you owe – your liabilities, and your available credit.

But that’s for tomorrow’s blog.

For tonight your homework is this – you’ve seen what your skills baseline told you about what you’re good at, what you know, and what you have talents for. Tonight you’ve seen your resources at hand, and tasted a couple of nibbles about the kinds of things you can do to earn a million dollars with them. Do you see an opportunity yet? Do you have the creative juices starting to flow? Are you mixing these into an interesting cocktail yet? Take a single sheet of paper and fill both sides of it with combinations of your skills and your financial resources in terms of ways that you could earn more money with them. Think about how to mix and match them together and tomorrow we’ll continue and finish off your financial baseline so you have a little better picture going forward.

The other thing to keep in mind is that I am going to start trying to post as often as I can from now until September 1st, both about the Race to get you ready and energized, but also with those informative pieces that I want you to think about in terms of business, and society in general.

I will be adding in a variety of other things to the conversation as well. In the next week or two I plan to finish a specific art project I’ve been working on called The Heart Stone. Once you see it, you’ll know why.

In the mean time, before I bid you good night good friends, a favour, if you please. Hug an icon. They seem to need a little extra support these days.