I want to talk to you about money today, more money today versus money tomorrow. I’ve probably about 14 points on a very important, but maybe not that frequently discussed topic.

From an economic standpoint, money is always worth more today than it is tomorrow. And the reasons being inflation. Money today will erode in value tomorrow due to inflation. There are other factors that mean as a general rule, money today is worth more than money tomorrow. That would be loss. You have loss. You have theft. You have risk. You have bad debt. I mean, if you have clients, and there’s 30 or 60 invoice terms, or you may have some bad debts, where you do a service, and you may not get paid for all of it.

Conceptually, it’s often worth cashing in money today especially, your products and services. If you’re a business owner, and you make those offerings. Usually, if there’s a payment plan on a product or a service, there’s a surcharge. There’s interest. Interest as a definition, is actually, interest to stay interested in collecting the money. And for you as the buyer, the debtor, for you as the buyer, you will only stay interested in paying for a product or a service, if it’s a penalty, if it’s penal. Money today, for those reasons, is always worth money tomorrow. But there are some money-making concepts around this that aren’t often discussed.

The first one, is, unless you invest in an asset. If you invest in an asset, a property, maybe you write a book, you have some IP, you write a song, I don’t know, there’s lots of assets, then the money could be worth more than tomorrow. But it has to go up above the rate of inflation, of the acquisition costs, of the maintenance costs, and of the management costs. A lot of people don’t factor those in. That might be on average let’s say, 5 percent a year. If an asset goes at 5 percent a year, it’s likely to make you more tomorrow, than it is today.

I don’t know, if you’ve seen that meme going around that image of Warren Buffett’s wealth. Age what? 14. And it goes up really slowly. Age 50, it looks like nothing has happened even though it’s many millions, and then it goes bang!! A massive compounding at age 50, all the way up, until what? Probably not far off 100 billion. And that’s all thanks to assets, otherwise inflation would have eroded the future value.

The element that a lot of people don’t necessarily put into when it comes to money today versus money tomorrow, it’s the time relationship between money today and money tomorrow. If you have a salary, or you exchange your time for money, which some kind of entrepreneurial teachers make out, it’s like a massive faux pas. Oh no, you shouldn’t be exchanging any time for money.

Well, I’ve actually completely pushed that back, because I get paid £10,000 for my 90 minutes speeches. And I’m quite happy to exchange my 90 minutes for £10,000. Now, some people charge £200,000, 2 million. Some people charge £200. But I enjoy speaking, and even if I could earn more than that in another venture, I’m quite happily exchange my time for money in that regard.

The money today versus money tomorrow principle, when it comes to your time, is, how much time do you spend on exchanging time for money on your salary and money today, essentially. Well, money 30 days in arrears. But let’s call that money today versus money tomorrow.

Money tomorrow would be building your assets. It might be building your speaking business. It might be writing books. But they’re going to take a year to get published, and then a year to get your time back. And they’re going to trickle down some revenue. Your new business, your side hustle, your new income streams, they’re all money tomorrow.

You have this balance going on, where you need to make money today to pay the mortgage, to counteract inflation, to pay your overhead, to survive, to feed your family, et cetera. But if you’re not looking at building new income streams for money tomorrow, then inflation could erode your money over time, such that 10 or 20 years, you’re actually net worst off especially, if you don’t get a really good incremental pay rise or increase in your prices.

But also, you may not have a pension. You may not have a future. You may not have a retirement pot. And a lot of people get overwhelmed about this, because they’ve got their job, and they really want to set up their second business or their side hustle, or they want multiple streams of income. But they’re either stuck in this paradox, where they have to earn money today. But they want to look into money tomorrow.

I would say to you, you probably want to have a little plan of how you divide your time. For example, you could say 70 percent of my time is money today, that is, current job, current business model. And 30 percent of my time is money tomorrow. So, at least you know you’re working some point towards the future to negate inflation, and create multiple streams of income, and have a future. But also, you’re getting the needs of today met.

If you work 60 hours a week, you might have to do 85-90 percent earning money today versus 10-15 percent earning money tomorrow. But it’s still really important you do that 10 or 15 percent. Because that 10 or 15 percent in 5 years and 10 years, could grow to 50 percent or 100 percent. When you have equalled your revenue from money tomorrow activities with money today employed or worked/earned income, then you can quit the job, or move into earning on assets, which is, always money tomorrow.

I’ve got a few points here. I’m going to read through. Just to check that I’ve covered them all. The risk with money tomorrow, is, it could come to nothing. You could put your time and effort into new ventures, and it comes to nothing. That’s the risk of money tomorrow. But the risk of money today, is that, it doesn’t grow enough to pay your future retirement. That’s why it’s good to have a plan and a time divided strategy, which I don’t think a lot of people do.

Money today is kind of pretty much proven and guaranteed. Money tomorrow is a leap of faith, because you have no idea, if it’s going to work. You have no idea, if you can do it. It takes faith for money tomorrow. But it’s comfort for money today.

Money today is sometimes, too comfortable. You get a nice salary. You’ve got a decent lifestyle. And you just get kind of used to, and addicted, and too uncomfortable with that. Then you don’t ever do anything for money tomorrow. Then all of a sudden, you’re 50, 60 and 70 years old, and you actually haven’t got a future. You’re stuck in your job, and you can’t retire.

For me, money today would be the assets I already owned, my pay income, my property portfolio. It will be the revenue from my training business and my existing other assets like, my book revenue, et cetera. I think Mark and I have about 9 incomes streams, the various companies that we own.

But 5 or 10 years ago, they were money tomorrow. Money tomorrow can become money today. And the more income streams you have of money today, the more revenue and capital you’re going to have for money tomorrow. For me money tomorrow, is, all the content I put out there. It’s the new books I write. It’s the new properties I buy. It’s the podcasts that I do. It’s the building the personal brand. And all that stuff, which is, a leap of faith.

Because I do like to give my time. I do like to give content. It’s something I enjoy. But of course, I want to get some pay-off as well. So, what’s my future pay-off going to be? Maybe, brand endorsements. Maybe, because I have such a big following. I might get speaking opportunities, TV opportunities. I might be able to do some partnerships and joint-ventures, et cetera.

There are a few snobs in the world of, if you think about Rich Dad Poor Dad, that talks about exchanging time for money. There are people who take that very literally, and they’re a bit snobbish like, oh, one does not exchange one’s time for money. That is not what one does.

Actually, I like the idea of having money today and money tomorrow. I like the idea having income from assets and income from doing what I love. Because, if you get to monetise doing what you love, then surely that is one of the great things of life, to be alive, to do what you love to do more often, and then to enjoy it with the added personal benefit of getting revenue. That also, increases your self-worth when it increases your net worth.

Don’t be too much of a snobber around money today. Also, if you have a good job, then you don’t want to chuck it all in, and risk losing everything. If you have a good job, you can still get mortgages, before you then quit going to property, when you might not get mortgages. You can transmute the experience of your money today into your money tomorrow.

It’s often quite a smart move to build both at the same time simultaneously. But then people get overwhelmed. That’s why I say it’s good to think about the time input and value in money today versus money tomorrow, which is, how much time you spend on money today, and how much time you spend on money tomorrow.

Then you can split it over time. So, for example, you might be 80 percent money today, 20 percent tomorrow. But then as you earn more income from that assets, that work tomorrow, that now become today, you can then go down to part-time. Then you can go down to full-time in your business ventures, and become a proper entrepreneur or business owner.

A couple more things to finish, is that, inflation will erode money today over time. You need to make sure that you are also building money tomorrow, such as your pension, your assets and your multiple streams of income. The risk of money tomorrow, is, it doesn’t always happen. It can come to zero. It can take you away from money today. That’s why it’s always wise to keep some good money today earning. A lot of people just quit their job on the dream of being an entrepreneur. I know it’s sexy, and it’s good for films. It’s good for podcast interviews. It can be risky. I don’t always advise that. I often say it’s good to balance both.

What I believe actually, a really smart strategy to do, is, earn decent money today as you can in your current business model, or your job, or whatever. Maybe it’s not the thing that you want to do for the rest of your life. But hustle like heck on the side. Set a date 1, 2, 3 years in the future, where you’re going to match the income from money tomorrow with money today. Then that be the day that you quit the job. All your income is coming from money tomorrow. Actually, when you’ve built enough assets, it’s money today and money tomorrow, which is, a double win.

The next thing, is, just thinking about when you cash in. I feel like watch prices are really, really high. And I feel like, there might be a little watch recession coming in. At the moment I’m cashing in a few Rolexes. Because, if I’m thinking money today is always going, sorry, money tomorrow is always going to come, but then the asset prices drop 30 percent, or it’s like a mini recession in the market, then I might have been better cashing in earlier, back to the economic, meaning that money today is always worth more than money tomorrow.

I’ve got some Rolexes that have gone up maybe 500 percent in the last 5 or 6 years. I’m cashing in some of those. Because I actually believe that, if it’s a watch recession, or a correction price, of which, it has to be at some point, then money today definitely is worth more than money tomorrow, even though they’re in an asset, where it’s usually money tomorrow is worth more.

With something like assets, watches, is an asset, they’re quite tradeable. I can get rid of them in a few days. Whereas property I’d always hold them forever, because I know that money tomorrow is always worth more than money today, when it comes to properties, because they tend to double every 10 years or so. Of course, they go through their cycles.

But if I sold a property today for 200,000, in 10 years even through a recession, it’s likely to be worth 300,000 or 350,000, 400,000. It’s knowing what assets actually reverse the rule of economics and money, which is, money today is worth always more than money tomorrow.

When it comes to clients, and products, and services, I would always cash in today, if I could. I might even have a small concession or discount for paying upfront, because I know there’s risk of default, and bad debt, et cetera.

Let me just summarise maybe the 10-12 points I’ve made on money today versus money tomorrow.

So, money is always worth more today from an economic and finances standpoint., because of inflation, loss, risk, theft, bad debt, et cetera.

Unless it’s invested into assets, which appreciate over time, such as property, certain intellectual property, certain businesses, certain managed funds although maybe not managed by certain funds managers, maybe, just the FTSE100 or something might be better. There are some stories of those going on at the moment.

The asset must appreciate above inflation, acquisition costs, maintenance and management costs for it to go up and be worth more tomorrow.

The big factor in money today versus money tomorrow is actually the time relationship, i.e., how much time do you spend on money today, which is, real, and how much time do you spend on money tomorrow, which is, future, and pension and retirement? But there’s a risk that it does actually come off.

So, the money tomorrow could be huge, or it could be zero. So, you’ve got to weigh up that risk. If you don’t build for money tomorrow, money today doesn’t grow.

There’s faith needed to build for money tomorrow.

For me, money tomorrow comes from assets. So, existing books, new properties, blah, blah, blah, blah, blah, blah, blah, blah, blah. Money tomorrow for me comes from existing assets. So, books properties, the current businesses that we have, et cetera. Incidentally money today for me, comes from those 2. It’s just the assets that haven’t been built for quite as long such as…

You know what? Blah, blah, blah, blah, blah, blah. I wish I could edit it. I’ve just got it the wrong way around. Anyway, I’m just repeating myself. But I’m doing the summary. You do need really care or need to know where money today or money tomorrow comes from, from me.

Maybe, a time split of 70/30 between money today and money tomorrow. It might be a good time split. If you’ve not got much money today, then you can maybe put a bit more time into money tomorrow. Whatever works for you, and you can change that over time.

Inflation will obviously erode money today, and actually, it erodes money tomorrow. So, a lot of people when they talk about property growth, they don’t factor in inflation. They just talk about gross figures.

Yeah, so, some things to think about, when factoring in building future income streams, and understanding how you get your income, and putting it into assets, and creating multiple streams of income, et cetera.

So, thanks for tuning in, everyone. This will go on the Money Podcast, which is, the second podcast of mine. Many people don’t even know I have that podcast. This will go up in a few weeks. So, yeah, I do fairly short one here. What we have on here? 15 minutes. That’s often one of the longer episodes, just on all different things around money that can help you:

Make money

Know more about money

Give money away, if that’s your desire

The way to use money

To embrace money

To have a better mindset around money

To create multiple streams of income

To understand the economics

To understand the history, the psychology, the meaning, et cetera.

Because there’s not enough money education out there, I don’t think, certainly, not in a lot of school. okay, there was Economics, which was optional. Probably, it should have been non-optional. Why is French compulsory in some schools, but Economics is not? That seems strange to me.

Rob Moore

The Disruptive Entrepreneur, double world record holder, business of the year winner 2016, 8x best selling author including 'Life Leverage', property investor, pilot & proud parent

"If you don't risk anything, you risk everything"

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