As someone who rose from being rejected from Harvard 10 times to becoming the second-richest man in China, Jack Ma’s rags to riches story is inspiringJack Ma
Through persistence and experimentation, Ma built one of the most successful, record-breaking companies to date, the ecommerce giant Alibaba.
Of course, his success didn’t happen overnight, and his story is full of lessons in failure. Growing up, Ma struggled in school, constantly failing tests. When he finally got accepted to college, after he failed the college entrance exam twice and was rejected from Harvard 10 times, Ma eventually became an English teacher. However, once he was introduced to the internet during a work assignment in 1995, the rest was history.
Motivated to help the internet catch on in China, Ma launched Alibaba, an ecommerce site for small- to medium-sized businesses, in 1999. From there, it took years to build the site into the massive online wholesaler it is today, powered by Ma’s motivation and passion. Today, Ma is worth a whopping $39 billion, and since he stepped down as Alibaba’s CEO in 2013, he’s devoted much of his time and money to social causes.
There’s much to learn about the Chinese billionaire. Here are 20 interesting facts about Ma you probably didn’t know.
He wasn’t a great student
While one might assume Ma was a straight-A student, quite the opposite was true. Ma admits that he actually failed multiple times in school: “I failed a key primary school test two times, I failed the middle school test three times, I failed the college entrance exam two times.”
He began learning English when he was 12
At 12 years old, Ma was committed to learning English. Every morning for eight years, he would ride his bike 40 minutes to a hotel in Hangzhou, where he would volunteer as a tourist guide for visitors just to practice the language.
He was rejected from Harvard University 10 times
It usually takes only one rejection for someone to give up on getting into an Ivy League, but this wasn’t the case for Ma. During an interview at the World Economic Forum’s annual meeting in 2015, Ma admitted to being rejected from Harvard 10 times.
He didn’t know what he wanted to do with his life after college
After graduating from Hangzhou Normal University, Ma applied for 30 different jobs, and he got rejected from each one. During the process of applying for these jobs, he wasn’t sure what he wanted to do with his life, so he submitted his resume for a variety of unique positions, one even being a police officer.
He was rejected from KFC
One of the 30 jobs Ma applied for after he graduated from college was a position at the fast food chain KFC. Out of a pool of 24 applicants, KFC hired 23 – and the one person who didn’t get a job was Ma.
He loves “Forrest Gump”
Jack Ma’s fictional idol is Forrest Gump. Like Gump, Ma also struggled in school, then went on to achieve success. “I’ve been watching that movie about 10 times. Every time when I’m frustrated I watch the movie,” he shared with CNBC in an interview. “I watched the movie before I came to New York.”
He became a teacher and made $12 to $15 a month
After graduating from Hangzhou Teachers University, Ma’s luck – and career – turned around. Ma was the only student of 500 to be chosen to teach at a university. Teaching English, Ma said he made what was then the equivalent of $12 to $15.
He was first introduced to the internet in 1995
In 1995, while on assignment as an interpreter in Seattle, a friend showed Ma the internet for the first time. His first search was on Yahoo for “beer.” However, it was through this search that Ma discovered there was no data about China, so he decided to launch a website called China Pages.
He was kidnapped and threatened with a handgun
During that same trip, which was his first time in the U.S., Ma also was assigned to go to Malibu, Calif., to collect debt from an American businessman on behalf of a friend. The businessman ended up locking Ma in his home and threatening him with a handgun. After a few days, the man brought Ma to Las Vegas with him when he was due to meet with a group of Chinese businessmen. Still without the money at this point, Ma won $600 on the slot machines in Vegas, bought a plane ticket to Seattle and left the scene.
His first entrepreneurial venture ended in failure
After borrowing $2,000 from friends to launch China Pages in an attempt to popularise the internet in China, Ma’s venture didn’t quite go as planned. It ran on a server with a dial-up connection in his small apartment, which made pages take more than three hours to load. At the time, his direct competitor was China Telecom, from whom Ma accepted an investment of $185,000 for a joint venture. In the end, however, Ma found he did not have much say in the business. Eventually, he left and took a job with China’s Ministry of Foreign Trade and Economic Cooperation.
He announced Alibaba in a videotaped meeting from his small apartment
By 1999, Ma was on to his next business idea for bringing the internet to China, and he had raised $60,000 from 18 friends to launch his ecommerce platform for small- and medium-sized businesses. Through a videotaped meeting that took place in his small apartment in Hangzhou, Ma introduced Alibaba.
The name “Alibaba” came from a children’s story
Ma got the name Alibaba from the folktale series One Thousand and One Nights. He was inspired by the story of the poor carpenter Ali Baba, who came across an abundant treasure.
While growing Alibaba, Ma and his team made mistakes along the way
Ma’s journey wouldn’t make for a true entrepreneurial story if mistakes and hardship weren’t involved. He attributes three somewhat counterintuitive factors to the success of Alibaba: having no money, no technology and no plan. He’s said that having limited resources made his team more diligent – especially when it came to money, because they had to use their limited funds carefully.
Even as Alibaba grew, Ma admits the company tried to expand too fast, was stretched too thin and had to lay off a lot of people. By the end of 2002, Ma said the company had made just $1 in profits.
Alibaba holds the record for most money raised in an IPO
When Alibaba went public in 2014, its $25 billion IPO broke records for the largest IPO in history – beating both Facebook and Visa.
But Ma wishes Alibaba never went public
In 2015, Ma admitted that if he could do it again, he would keep Alibaba private. “Now, after the IPO, it’s much worse,” he said in a speech to the Economic Club of New York. “If I had another life, I would keep my company private.” After Alibaba went public, it entered the spotlight and faced some scrutiny from investors, regulators and the media. Ma was playing on a bigger stage. “It’s not only our people that watch us,” he said, “the globe watches us.”
He says he doesn’t know much about technology
In an interview with Charlie Rose, Ma admitted that he actually doesn’t know much about technology, despite owning one of the most successful tech companies in the world. “I know nothing about technology,” he said. “The only thing I can use my computer [for] is [to] send [and] receive email and browse.”
He loves to perform
Ma loves to put on a show. In 2009, during Alibaba’s 10th anniversary party, Ma threw on a blonde wig and performed The Lion King onstage. At the 2017 anniversary party, Ma went all out and dressed up as Michael Jackson from the Dangerous World Tour. With a group of hired backup dancers, he performed “Billie Jean” and Beyoncé’s “Formation.”
He’s the second-richest person in China
As of September 14, 2017, Ma is the second-richest man in China, according to Forbes. He has a net worth of $39 billion.
He stepped down as Alibaba’s CEO because he felt he was too old
In 2013, Ma stepped down as Alibaba’s CEO, saying, “I’m 48. I’m no longer young enough to run such a fast-growing business. When I was 35, I was so energetic and fresh-thinking.”
After stepping down as CEO, Ma refocused his efforts on social issues
In an interview with the Financial Times, Ma shared what he planned to do after leaving his executive position. “In China, because of problems in water, air and food safety, in 10 or 20 years, we will face a lot of health problems, like increased cancer. So that is one area where I will invest my money and time.”
Alibaba bought a stake in Citic 21CN in 2014, changing its name to Alibaba Health Information Technology Ltd. Since then, Ma has spent much of his time and money attempting to bring hospitals and pharmacies online.
That same year, Ma launched the JackMaFoundation, which focuses on education, the environment and public health. In 2015, Ma was recognised as China’s biggest philanthropist, having donated a total of $2.4 billion (after share options) to his foundation.
This article was originally posted here on Entrepreneur.com.
5 Key Areas Pratley Are Using For Current And Future Growth
The aim of most family-run businesses is to stand the test of time, a goal that influences strategy and tends to take the long-term view over short-term gains. Entrepreneur spoke to Kim Pratley and his sons, Andrew and Charles, about growing a business without compromising on quality or price.
- Players: Andrew Pratley, Kim Pratley, Charles Pratley
- Company: Pratley
- Founder: George ‘Monty’ Pratley
- Est: 1948
- Divisions: Electrical division, adhesives division, mining and minerals division; Select Hairdressing Supplies
- Visit: www.pratley.co.za
In both B2B and B2C circles, Pratley is a household name. Pratley Putty and Pratley Steel can be found in most home workshops and garages, while cable junction boxes tend to be called ‘Pratley Boxes’ in the electrical world — even if they aren’t Pratley-made.
Building a brand that has cornered the market in many respects is a good foundation for future success, but it does not guarantee it. Sustainable growth takes an ingrained value system that the entire organisation believes and follows, strong cash flow, continuous innovation, an unwavering focus on quality and sacrificing short-term gains for long-term aims.
Pratley has been on a steady growth trajectory over the past 70 years. Many companies reach maturity and stagnate. Pratley has done the opposite. All growth periods are followed by consolidation, but despite numerous challenges and tough market conditions, the line continues to move up.
Here are five key areas that Kim, Andrew and Charles are focusing on to maintain that growth, now and for the future.
1. R&D: As the core – not a small side division
“Research and development has always been our core, and as a result of that, diversification,” explains Kim Pratley, CEO of the business. “We launched with our electrical division in 1948, followed by the adhesives division.” Before their first product of that division, Pratley Putty, was used by NASA on the moon, it was originally developed to stick electrical terminals into an electrical junction box and insulate them.
“Once it was developed though, we realised that we could productise it outside the electrical sector for the consumer market, and our adhesives division was born.”
Developing new products is in Pratley’s DNA. The company aims to release at least three or four new products into the market each year and is continually looking for new and better ways to do things. “We have to grow somewhere,” says Andrew Pratley, Pratley Group IT Manager and General Manager of Select Hairdressing Supplies. “We need to be simultaneously growing our markets and our product ranges, and that means we need to find better and more cost-effective ways of doing things.”
There is a school of thought that says a smaller, tighter product range keeps costs down and the business focused. In many ways Pratley has done the opposite, with its electrical division offering more than 3 000 products, many of which are patented and based on proprietary technology.
“Like most things in business, our product range follows the 80/20 principle,” agrees Kim. “20% of our product range is responsible for 80% of our revenue. Logic would say why have the rest then? Unfortunately, because of the way the market operates, customers expect us to also provide the niche products that don’t sell well but are occasionally needed. If we chopped off the 80%, we would lose a lot of the customers who make up the 20%, but are responsible for 80% of our revenue.
“It’s a perception — a customer who buys all their products from Pratley expects to be able to get everything from us. If they need to go to a competitor to get a special fitting, they might move all their business.”
That said, there are cost and complexity implications when carrying such a large product range, which means the management team needs to be hyper-focused on the details. “We’re currently looking at rationalising our product range. Products become obsolete and if you’re too focused on new products without paying attention to the entire range you can end up carrying old stock or manufacturing unnecessary items,” says Charles, Engineering Manager: Group Technical Services.
“Our customer base appreciates that we’ve become a problem solver in the market — they come to us with a need, for example, a stainless-steel cable gland for the food industry, and we will design and manufacture it. It must be viable for us as well, but on the whole, because we do everything in-house, we can add value as real problem solvers and as a one-stop shop,” adds Andrew.
Customers want quality, their lives simplified, and good service — exactly what Pratley aims to offer.
R&D’s role in creating diversification for the business has also mitigated Pratley’s risks. “Rubber brushes inside a flame-proof cable gland is what keeps people alive — if they fail, people die. If there’s an explosion inside the apparatus and it gets out and ignites the atmosphere, people die. The technology that goes behind that rubber is polymer technology; adhesives are also based on polymer science. We can bring the same expertise from the one side of our business into the others,” explains Kim.
A sister company of Pratley, Select Hairdressing Supplies, was first bought from Kim’s father-in-law when he retired, but the business has since been expanded to bring manufacturing in-house and to develop proprietary products. “We asked our R&D team what they knew about hair products,” says Kim. “They went away, did some research and came back and said we could definitely do this. We also import some products. It’s a profitable business in its own right that diversifies our risk.”
“It’s a high-end product,” adds Andrew. “Our market is professional hairdressing salons, and they cater to clients who demand quality, high-end hair products. We don’t compete with cheap imports at the lower end of the market. The focus is on quality at a reasonable price.”
On the whole, Pratley’s R&D follows a two-pronged approach. Charles, Andrew and Kim all love R&D. If they find something cool, they want to mess with it until they find a real-life application for it.
A strong R&D mindset means the team is always open to finding solutions to problems.
Pratliperl, a lightweight, thermally insulating cement aggregate that was originally developed for low-cost housing, is now used as a fire-proof plaster that doubles the thermal insulation of a building. It’s very lightweight and is ideal as a screed where additional floors to buildings are required. Pratliperl has been used at Loftus Versfeld Stadium and the Sandton City parking lot.
2. Finding market fit
A strong R&D component works hand in hand with the ability to shelve products that aren’t working in the market, and Pratley has had a few of those. Sometimes even the best products don’t find product-market fit — in one memorable case it was because the product worked too well.
“We launched a product called Wham a few years ago because customers kept requesting an ultra-quick super-glue,” says Andrew. “We wanted to design the fastest adhesive in the world — and we did — but it ended up being practically unusable. It was just too quick for the end user.”
It was an interesting lesson for the team on giving customers what they need, and not necessarily what they ask for.
“We also brought out a palm cleaner that I love, but which the market hated,” says Kim. “We wanted a solution for dirty palms after you’ve changed a tyre, for example. Palm Cleaner was essentially a glue that stuck to the dirt and then rolled off the hands in little balls. It was extremely effective.”
Consumers didn’t read the instructions and thought it was a hand cleaner. The result was Palm Cleaner getting stuck in the hairs on the back of people’s hands.
“We try to stay away from ‘me too’ type products. We look for problems that haven’t been solved or where we can do it better. That involves a lot of trial and error, and we won’t always get it right,” says Charles. “That’s the cost of R&D. You can’t let your ego or personal feelings get in the way of what your market research is telling you.
“We have a department that tests everything in every way the market could use it. Interestingly, we often find that we test a product for one thing, and end up finding a whole host of other applications for it. Sometimes the larger market is the one we didn’t originally develop the product for.”
It’s an interesting process. You can’t make assumptions about any market, even one you know well, and if you aren’t looking at solutions from every angle, you could miss a huge opportunity. This thinking has become ingrained at Pratley.
3. Quality first
In a world where one industry after the next is becoming commoditised and businesses are competing on price (particularly against low-cost imports), Pratley’s strategy has remained the same, with a strong focus on quality, in-house manufacturing and R&D.
How do they maintain this from a cost perspective, particularly when so many companies are turning to outsourcing to keep costs as low as possible?
“We have two main drivers,” says Kim. “Every pack of Pratley carries a statement signed by me that our products must outperform any other on the world market. It’s a big statement, and we mean it. It’s so big that we’ve found in some cases people actually don’t take it seriously because of its magnitude.”
Over the years Kim has performed a number of stunts proving his confidence in Pratley’s products, including filming a TV commercial standing below a 13 tonne bulldozer suspended by a joint bonded together with Pratley Wondafix.
“We don’t believe the statement itself necessarily leads to sales, but it does have a big impact internally,” he says. “Inherent in our core values is the ideal that we need to be producing the best — it’s expected from every person in the organisation, at all times.
“From an external customer point of view, the fact that the product works is important. How we ensure that quality is a result of what we do internally.” A product that consistently works fosters trust and brand loyalty, which results in repeat customers.
Because the company’s focus is on quality, this is a non-negotiable, but there is a cost to quality as well. From a sales perspective, this means Pratley’s sales force needs to concentrate on educating the market about purchasing a slightly higher priced product for the long-term gains that are achieved from peace of mind and the risk mitigation of operating in a safer environment.
“We manufacture cable junction boxes, cable glands and the rubber shrouds that protect those glands for hazardous locations. If something goes wrong and there’s a fire or an explosion because a cheap inferior product was chosen and used, people can lose their lives,” says Charles.
“In some cases, it’s relatively easy to convince the customer as they have either had a costly experience with a cheaper product or have seen UV-damaged rubber shrouds from a cheaper brand. It’s up to our team to educate our customers. There is also always a segment of the market that will buy cheap, no matter what, and we accept that and don’t waste resources trying to convert them. There is also a segment that recognises and always chooses quality, and that’s our ideal market.”
To mitigate higher costs associated with quality, R&D and local manufacturing, Kim and his directors work tirelessly to control costs. Every line item is scrutinised, but never at the expense of quality.
“Our sales arm plays a key role in the business for this reason and we emphasise training to ensure the team is equipped to engage with customers and understand their needs and the risks they face, balancing those risks with the costs of investing in quality.”
In line with a strong quality proposition are high exstore service levels that ensure Pratley can offer high-quality customer service. “We measure this according to the value that comes in versus the value executed. If 100 orders come in, we must execute 99% of them exstore immediately,” says Kim.
“This requires a large amount of inventory on hand, so we need to pay attention to which stock moves and how quickly, but ultimately we understand the frustrations and costs of downtime, and we aim to minimise both for our customers.”
From a cost perspective, the father and sons team understand that they need to be aware of the market and competition in order for their manufacturing methods and pricing to be internationally competitive, and the way to achieve that is through the right machinery, controls and management.
“We have a very flat management structure,” says Kim. “We aren’t top heavy. We have directors who are in charge of specific departments, middle managers and foremen. Each department is run as clean and lean as possible. The numbers are monitored by each foreman and reviewed at board level. Nothing slips through the cracks, and each number is scrutinised.”
4. The power of (the right) people
One of the biggest hinderances to growth that Pratley has faced is human resource issues. Based on the West Rand of Johannesburg, the business doesn’t have access to as large a labour pool as it would if it was based on the East Rand or closer to the city centre.
That said, Kim, Andrew and Charles love the lifestyle on the West Rand, and they operate from a large property developed specifically for their needs. 185 employees work from that site, with satellite offices in Durban, Port Elizabeth, Cape Town and Bloemfontein.
“We employ multi-disciplined people who have skills in their primary activities, but who can also play a secondary role,” says Andrew.
“If you employ a person for their underlying work ethic, willingness and general attributes, you’ll employ a good person who can do anything,” agrees Kim. “Attitude and a willingness to learn means you can upskill someone and they will be eager to take on more responsibility and perform their defined roles. This is true across the organisation and not just in middle management positions.”
As a result of this people-focused strategy, Kim, Andrew and Charles remain involved in the business’s hiring process. “It’s not something you can delegate,” says Kim.
5. Cash is king
Pratley is in the enviable position of never having financed the business. As a result, the company has grown more slowly than it could have, with each new acquisition or investment into machinery or R&D funded internally through cash flow, but it has never had to service debt.
“We’ve been comfortable delaying growth, where necessary, to be able to make investments from our own cash reserves,” says Kim.
“We have very strict but fair payment policies in place. Credit control is a non-negotiable. Our rules are set in stone and there’s never an exception; it doesn’t matter who the client is.”
The terms are straightforward: Payment is in the month after the date of invoice. If you place your order on the first of the month (and it’s dispatched immediately, thanks to the company’s 99% exstore service levels), you can essentially have 60 days to pay, as the payment is only due at the end of the following month. Pratley also offers good settlement discounts.
But there are never, ever any exceptions to the rules. When their biggest adhesives client took a R2 000 settlement discount that they weren’t entitled to, supply was immediately stopped.
“The Adhesives sales manager resigned over that decision,” says Kim. “He handed over his letter of resignation and said we were mad. It was a small amount and they were a big customer, but I knew that we’re not in business despite that decision; we’re in business because of that decision.
“If we had buckled, it would have set a precedent. Instead, I called them up and said, ‘You know the rules, I know the rules, I know what you’re doing, you know what I’m doing, let’s carry on.’ They’re still a very good customer today — but it was important to stick to our guns. It’s important to have people in the business who understand this, which is why I accepted that sales manager’s resignation. More companies flounder on the rocks of cash flow than anything else.
“Our growth strategy has been to build up cash reserves. That takes rules that you stick to above all else. One of my favourite business mantras is that profit is the very small difference between two very large numbers. All you need is one small percentage change on one of those numbers and your profit disappears. If you’re not taking risk with one of those numbers, well, I see that as security and survival.
“That doesn’t mean we don’t spend money — we’ve just invested in some very expensive machinery that will increase our output, productivity and efficiency down the line. It’s a large upfront expense for future growth and sustainability. But it’s a mitigated risk because we’ve built up the reserves to take that next step.”
Cash is King
Profit is the very small difference between two very large numbers. One small percentage change on one of those numbers and your profit disappears. How are you mitigating that risk?
In a competitive business landscape where skills are in high demand, employing multi-disciplined people who have skills in their primary activities but can play strong secondary roles is crucial.
The cost of quality
When you’re competing against commoditised products that differentiate in price, it’s not enough to know you offer quality. You have to prove the value of that quality by educating your market.
The Law Of Attracting Your Success
Once you discover your who, you automatically discover your why, which in turn allows you to lead with your heart rather than your head. Discover that energy source, and the world is your oyster.
From the teachings of Buddha to the concept of karma, the Law of Attraction has been expressed in many ways by both ancient and contemporary thinkers. In its most simplistic interpretation, the Law of Attraction states that ‘like attracts like’.
Your ability to Magnetiize exists whether you are aware of it or not, whether you are positive or negative. You make daily decisions to choose whether you want to attract success or failure (however you define them), whether you want to live a more conscious, elegant and curious life or whether you want to keep your head down and stick to the old rules.
We are constantly Magnetiizing in every aspect of our lives, whether we’re running a business, interacting with friends or simply walking into a room. Changing how you do it can be a scary prospect, but it will move you from a stagnant space to one in which you can develop with meaning.
When you are in a space of positive magnetism, the momentum builds and your access to energy is incredible — it feels like electricity running through your body, with your ideas in focus and creativity flowing.
Magnetiize in 3 Steps
To Magnetiize is to take control of your own future and, in so doing, transform from a state of panic to a state of calm; from chasing ambition to seeking meaning.
- The first step is a process I call Micro Inspection: How to confront the obstacles in your mind and start making decisions that are led by your heart.
- Then comes Mega Exploration: Examining the qualities of future-forward and conscious businesses.
- Finally, you need to bring it all together into your own reality, with the Macro Perspective: Understanding new technology and trends, and embracing the future.
This holistic approach allows you to Magnetiize into your life the right type of people, appropriate access to opportunities, and the money and power you need for sustainable success. To truly achieve, you must combine Micro Inspection, Mega Exploration and Macro Perspective.
When you learn how to Magnetiize, you attract a tribe of people who you can work (and socialise) with in harmony. Your tribe should consist of elders, advisers and friends who complement your skills and personality and bring out the best version of you — the best ‘I’ behind your ‘I’. You’ll find that the tribe changes, for the better, the type of decisions you make and the discussions you have.
And as a result, your ability to Magnetiize will rub off on those around you, encouraging them also to step out of their comfort zone and to participate in shaping the future.
Magnetize is circulated through all good book sellers and at www.johnsanei.com
Lessons From The Rich And Famous: Manage Your Money Like Oprah To Avoid Going Into Debt Like Nicholas Cage
Have a plan in place for your money, no matter how much you earn.
Seven-figure pay cheques are enough to buy a lifetime of financial security, right? Well, not exactly. Despite making millions, seemingly wealthy celebrities often have a tough time keeping their heads above the financial waters.
Johnny Depp spending $3 million to fire Hunter S. Thompson’s ashes out of a cannon, or Nicholas Cage shelling out $150,000 for a pet octopus, are both prime examples of how lavish lifestyles can quickly lead to debt. The two A-listers are part of a long list of actors, musicians, athletes, etc. – including Floyd Mayweather, 50 Cent and Curt Schilling – who have all experienced financial troubles.
While there’s nothing wrong with celebrities enjoying their earnings, a little budgeting can go a long way. Just take a look at Tori Spelling. After failing to pay a balance of more than $35,000, the actress was taken to court by American Express. Another example is 80s movie star Corey Haim. He became so desperate for cash after filing for bankruptcy he tried to sell his own tooth on eBay for $150, which didn’t get any buyers.
Avoid falling into any of these situations by keeping a close eye on your spending. Regardless of how much you make, the following few budgeting tips promise to help you practice safe and responsible money management.
Put a plan in place
Nearly everyone lose sleep over their finances. Get a good night’s rest by figuring out where your money should be going long before it’s in your bank account. Spending without a plan, even if it’s only splurging on a one-time event, can have unintended consequences.
One example of this is former NFL star Vince Young – after dropping $300,000 on his own birthday party he was forced to file for Chapter 11 bankruptcy. Another example is Mike Tyson, who went into debt after overspending on Bengal tigers, 110 cars and a $2-million bathtub.
That doesn’t mean you can never treat yourself, but make sure you’re not spending money faster than you can earn it. Set up a series of “fun funds” each month to splurge on nonessentials. Depending on what else you have going on that month, each fund should be adjusted accordingly.
If, for example, you’re heading out to a friend’s wedding, there may be a little less left over for eating out. Stay up to date on your spending by downloading a budgeting app. The easier it is to see where you are for that month, the better chance you have of staying under budget.
Carry around some cash
Credit cards are becoming the most common payment method among consumers. The average American currently carries around three credit cards at any given time. While they may be more convenient, credit cards can easily lure consumers into a false sense of security.
After all, a simple swipe or tap is often all it takes to complete a purchase. However, it’s important to take time to research any costly items thoroughly and ensure you won’t regret them like Nicholas Cage. He learned this lesson the hard way when he blew $276,000 on a dinosaur skull that he was forced to return after it was discovered to be an illegal import.
Curb some of your impulse spending during a night out by bringing enough cash for the occasion. In addition to avoiding spending money you don’t have, you’ll also sidestep costly ATM fees at establishments that only accept cash.
Whether it means stopping by your bank on the first of every month or getting cash back at the grocery store, do whatever it takes to have a little bit of cash on hand. As you cut back on credit card purchases, your chances of falling into debt should begin to dwindle.
Lean on an expert
When it comes to your finances, take a lesson from the likes of Oprah, Tyga and Hugh Jackman, who invest in financial and life coaches. Many celebrities, including Oprah, attribute their success to their coaches helping put them on the right path. Even celebrities are human and can find it difficult to stick to budgeting goals.
Personalised features of a comprehensive coaching programme, such as daily check-in texts and bi-weekly budget reviews, promise to provide you with the encouragement needed to remain accountable even as the going gets tough.
Better yet, a financial coach can take your individual goals into account. Say you decide to start a family or need to make a cross-country move. Instead of wondering what that might mean for your budget, you can work with a financial coach to modify your spending habits and investments long before a change comes to fruition.
Budgeting goes beyond class. No matter how much you make, responsible money management has shown itself to be a necessity. Avoid following in the footsteps of celebrities who face serious financial trouble by keeping a close eye on where your money is going.
As we’ve seen all too often, failing to do so can mean losing millions. Simple steps – including creating a spending plan, occasionally relying on cash and reaching out to an expert – can help you achieve financial security sooner rather than later.
And if you plan carefully enough, you might just end up with the funds you need for that pet octopus.
This article was originally posted here on Entrepreneur.com.
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