Forget Net Worth
If you are like many other people in the world today, you are interested in learning how to create wealth and become financially free. As the global economy continues to decline, more and more people are searching for the secrets to wealth creation. The secret to creating wealth is to simply forget about focusing on your net worth because that is of little importance, if any at all.
Cash flow is what you need to focus on if you want to create significant wealth. Several bankers and finance planners may tell you that if you want to create wealth, you have to increase net worth. That is just not so; net worth is not the sole deciding factor to creating wealth. Cash flow determines your financial freedom.
You have achieved financial freedom if your passive income exceeds your expenses and you no longer have to work to sustain you present standard of living. Net worth does not guarantee financial freedom. It may help, but it is definitely not the most important factor in creating wealth.
If you have a net worth of $2,000,000 and $0 passive income, the money will cover your $100,000 per year expenses for twenty years and be gone. If you have a net worth of only $200,000 and a cash flow of $200,000 per year, that flow of cash will continue to pay you your entire life.
Being wealthy is knowing that you have the freedom to do anything you choose to do. It is freedom of you time as well as your money, which is something that you can only get from positive cash flow.
Once you begin focusing on income instead of net worth, you will see an increase in your passive income. Following such a strategy, you should reach financial freedom in five years or less as long as you forget net worth and keep cash flow your main priority.
Sean Rasmussen
Success Communicator
Aussie Internet Marketer © 2004 – 2009
Tags: Create Wealth, Creating Wealth, Passive Income, the Secret, The secret to creating wealth, Wealth Creation