In 2018 I attended an options trading workshop.
The premise of the workshop was to learn how to generate a consistent income from options trading.
It utilised a strategy called “covered calls,”
(which I won’t get into right now.)
The first exercise we did at the workshop was to work out how much income we needed to cover our living expenses.
The idea being…
Once you know how much income you need to generate per month, you can reverse engineer how much capital you would need to invest.
And… how much risk you would need to take.
In this method of options trading, the more risk you take on, the higher the potential returns.
The less risk you take, the lower the returns.
It became very clear to me.
The more capital you had to invest the easier it was to generate a certain level of income.
The less capital you had the worse your odds.
I could see some people in the room had very little capital to invest in running this strategy.
When I looked at the risk they had to take on it just seemed insane to me.
There are better odds at the casino!
I couldn’t believe they were willing to take on so much risk.
But then it hit me…
They don’t have the option to get more capital from their business.
I had the option to make more money in business and take on much less risk with investing.
They did not.
Having the ability to earn more from business is a massive advantage when it comes to investing.
Which brings me to this week’s episode.
While business owners have the option to earn more.
Most of them suck at it.
So, I want to offer a process that I have used to massively increase my income over the years.
In this week’s episode:
○ a practical approach to earning more
Prefer to listen or watch?
You can hear Grant and I discuss these topics in more detail on the podcast
Click here to tune in: https://linktr.ee/businessandinvestingcom
How do I earn more?
Oooooohhhh….. the juicy bit.
Let’s go through the steps.
1 – Get uncomfortable with what you earn today
In my opinion, this is the most important step.
The more uncomfortable you are with what you earn today the better.
If you just kinda want to increase your income you will likely fail.
The times I have been EXTREMELY uncomfortable with my income, are the times I have been able to raise it the most.
When my son Jack was born I didn’t feel my income was high enough to support what he needs.
How uncomfortable do you think I felt with the idea of not being able to provide for my child?
I lost sleep thinking about it.
The cost of food, school fees, housing…
What if we have 2 kids or 3?
We all have different things that make us uncomfortable.
Find yours and lean into it… hard!
Use it as fuel.
Don’t pretend it doesn’t exist.
Stare at it.
2 – Set a target income
Now that you are uncomfortable the question becomes what would make you comfortable?
Following on from the example of when my son was born.
I was incredibly uncomfortable.
So, I created a spreadsheet and calculated how much income I needed.
I went deep and specific.
How much are the school fees?
What do nappies cost?
By the end of it, I had mapped out the cost of what it would take to get 2 kids to 25 years old.
I then turned that into an income level I needed per month to support that.
Hitting this target is what would make me “comfortable” with my income.
Personally, I love having a target to aim for.
Most business owners I know are the same.
Define your target and be specific.
3 – Tracking
You often hear
“What gets measured gets managed.”
Do you know why?
Because it’s true.
As business owners I’m sure we know the importance of tracking but, here are some specific things I do when I’m focused on raising my income.
I have my bookkeeper highlight my income on my monthly financial reports.
I want to see the progress month on month and how close I am to the goal.
I want this number to stand out in the reports, so I can’t miss it.
Make it bold and highlight it.
I do this for a few reasons.
Having it stand out keeps me focused on what I’m trying to achieve.
It keeps my eyes on the target and motivation high.
It also helps me know if the actions I’m taking to increase my income are working or not.
If I’m making the right decisions and taking the right actions I will see progress.
If not this is the sign to change something.
It can be confronting to look this closely at your income but it is critical to the process.
4 – Create the business model that supports the level of income
This is where I see a lot of business owners make big mistakes.
They want to earn more $$, so they start ramping up marketing and sales as step 1.
However, they have taken zero consideration to if their current business model will support that level of income.
In turn, many business owners just get frustrated and give up.
If you have never earned at the level you are striving for, then it’s highly likely there are things that are required that you just don’t know about.
Here is what I do instead.
Find someone who has done it with a similar business model to yours.
Pay them to show you how they did it.
Follow that advice and track the results.
Now… This is important.
If that method you follow from someone who has done it is not working.
Find someone else and repeat the process.
You might need to find and try several people’s approaches.
In my own experience, I have often had to find and try several different methods before finding the one that was right for me.
Do not default to trial and error based on what you think will work.
Model those who have done it!
5 – Accountability
This is the secret sauce and likely the difference in you increasing your income.
Also, remember that raising your income can take some time and if you lose motivation along the way.
Here are things I do…
○ I like to have my monthly financial reports highlight if I’m making progress in this area or not.
Every month I’m either inspired because I’m making progress towards my desired income level or it makes me uncomfortable again and motivates me to do more.
○ I tell my peer network.
This was incredibly uncomfortable at first.
If you have a good network not only will they be supportive but they will also help you.
Heck some of them might start doing it with you.
To this day Grant and I use this type of accountability to push each other.
(we do it with things like wealth building also)
○ I have mentors I report to.
I mentioned above that you need to find people who have done it.
When possible I encourage you to hire them to guide you along the journey also.
Things will come up along the way to raising your income.
Having someone who can realign you and tell you what to focus on next is critical.
6 – Repeat
Once you hit a new level of income, the key is to not get too comfortable for too long.
Of course, take a moment to celebrate your new level of income and the rewards that come from it.
But, keep pushing that bar up!
Don’t let yourself get stale.
Be on the lookout…
At the start of next week, I am having my mortgage broker (Aaron Whybrow) on the podcast.
But… we won’t be talking about borrowing money.
We will be diving into how he invests personally and his journey as an investor.
If this is the guy who knows all the rules…
It’s going to be just as beneficial as asking the head chef where and what to eat.
Anyhow, if you want to hear that episode when it drops make sure you are subscribed to the podcast.
All information we share is NOT financial or investment advice and is purely intended for entertainment and educational purposes only. Always seek professional advice before acting on any financial decision.
00:00 Welcome to Business and Investing
03:08 What’s stopping business owners from earning more
09:20 The first step to growing your income
16:35 Defining what ‘earning more’ means for you
18:27 Using the right business model to boost your income
30:55 The importance of having strong support networks
If you enjoyed this episode, be sure to subscribe, tune in and share this podcast!
- Business and Investing website: https://businessandinvesting.com/
- Subscribe on Youtube: https://www.youtube.com/@businessandinvesting
- Subscribe on Apple Podcast: https://podcasts.apple.com/au/podcast/business-investing/id1607453342
Connect with Us:
- Join the Business and Investing Community: https://www.facebook.com/groups/440140397804480
- Follow us on Facebook: https://www.facebook.com/businessandinvestingcom
- Follow us on Instagram: https://www.instagram.com/businessandinvestingcom
- Follow us on TikTok: https://www.tiktok.com/@businessandinvestingcom
- Send your enquiries or drop by to say hello: email@example.com