Roger - I made a decision last month when I turned 46 that I would finally "figure out" this financial thing and that my future would alter to allow for the success I know I can create with my business. I read your book and then sat with the fact I was in red and no idea how to get to orange. Then I had opportunity to take online hours at my day job so I could start to pull out of red into Orange. I still felt bewildered that orange was elusive as all the debts and expenses increase commensurate with income increase as you've pointed out. Still I've been hopeful and watching your videos to see what I can glean that I have never gleaned before. BIG LESSON: putting all my eggs in the entrepreneurial basket for so many years at expense of personal /household wealth. My husband did the same. Together our ship sank - with children aboard. But THIS particular video really speaks to me and makes me wonder how come I never figured out what you've so simply illustrated. I am now chomping at the bit to create these four accounts and to simplify my financial life and influence people around me to do the same. Onward!
Thanks for sharing the story of your sinking ship. Inspiring to see you still motivated to learn the lessons and start again to move up the lighthouse. Wish you all the best with it.
Oh my goodness, Roger you have just given me a huge revelation!!! Until I have earned the right by managing my personal finances, my business will not grow to the level I know it can get to!!! A have set up a jar system for myself and my kids where we put money into 6 different jars, more like the lanes, but this has simplified it so much more!!! Thank you, thank you, thank you.
Roger, I really like this concept, but I have a few questions: 1) If you have a main business that gives you your primary income (say you're a freelancer for example), would you pay yourself into your clearing account, or into the investment account? 2) Where would you put savings and other money that is not directly for investment? Would you have a 5th savings account somewhere? I recently read a great book call Low Cost High Life where the author (Mark Homer) outlines a similar idea he calls the "bucket system". In it he says to divide up your income as follows: 1) 55% Bills and living expenses 2) 5% Giving/charity 3) 10% Investments 4) 10% Investing in yourself (education/networking) 5) 10% Bucket list (fun stuff to reward yourself) 6) 10% Save And Never Touch (high interest savings to which you can eventually live off just the interest) I think my wife and I are going to create a hybrid system between your model and this one. Finally, a another good money tracking system to check out is www.pocketsmith,com
Mark Hazeldine Hi Mark - Pay yourself a fixed monthly salary into your clearing account, so you're always covering bills and cash expenses. Then every three months, as you make extra profit, pay yourself a dividend into your investment account
Mark Hazeldine As for savings - you can have extra 'vehicles' in the fast lane which include high interest savings accounts or multi-currency accounts, which are effectively investment vehicles in the form of cash with low risk, low return.
Thanks for sharing this great idea of setting up 4 Bank accounts, Roger! I will set this up for me asap! ( You are right this not only will help you with your Personal Finance but with my Business I plan to start as well!). Thanks Roger for another Awesome video! as I like and learn a lot from all of your videos! Later! Walter from Utah, United States.
Thanks for this Roger, I set this system up personally when you were with OneLife, however, never thought to do that for Bloom. Beryl is onto it! PS Love the petals and stones, cute!
I've known about this system of money management of yours for a while now Roger but still had not set it up. Got on the phone to the bank today and was able to do it in about 15 minutes. :) Like many other people here I too have experimented with the jars/bucket system that people have mentioned but this is a great way to keep the money in the bank physically separate.
Hi Roger, I love your plumbing system the first time I saw it on GeniusU. I definitely have the experience of having a leaky plumbing system. Although I was an accountant before and I had a personal budget, I find that tracking money each month was tedious. Plus, when I started invested and business, all my money get meshed up together. I don't know how much to spend on each category. I have a of questions about the plumbing system: 1) If you have one-off big expenditure such as travel and education/courses that you don't spend on a monthly basis, where does the money go? The cash account? 2) Does your business has a plumbing system too. If so, is your business plumbing system similar to your personal plumbing system?
Nerdy Creator As much as possible, 1) should be billed through your business so they are a business expense and then focus on the business giving you a return. If it is for a holiday then yes, only go if you have the money in your cash account to afford it! For 2) yes you can set up your business like this too. All big businesses, banks, stock exchanges and entire countries etc use clearing accounts - For example the US Clearing House Network cleared $39 trillion last year, always with $0 balance at the end of each day...
I couldn't wait to tell my husband about this! I know I said this before, but the mere fact that you are teaching us life changing, mind shifting concepts, PLUS you still take time to answer all these questions says a lot about your heart. I am so touched by the help you are giving us. so I have an IRA that I have no idea what is going on with it(for like 20 yrs now, im so embarrassed). Im just "trusting" someone to handle it at scottrade. when you say the money from the fast lane like dividends should go back to the middle lane, how do you do that with a retirement account and I have had not great experiences with finding a cpa-I only want one who understands your concepts, should i google cpa who listens to roger hamilton?..LOL seriously though that will be a qualification now that I am learning from you, thank you
Michelle StayingHomeMom Take control of your retirement account! Have a read of Tony Robbins' new book Money: Master the Game for details on how to do that.
Roger James Hamilton got the book and will listen while at work.. i always listen to books not music while working(multitasking)lol, loved all of your wealth cd's now I will go back and listen again so I can actually apply and take action
I shared this video with my little sisters. On Monday I'll be helping one of them set theirs up. I got mine set up this November, but I was wondering, what kind of bank account is best for the wealth/investment account? At the moment I have three current accounts for cash, checking and clearing, and I'm using my e-isa as my wealth account. Will that do, or should there be a fourth current account that is called the wealth account, where money is put first before being transferred to savings accounts or bonds or other kinds of investments when the time comes? Hope my question makes sense, cheers :)
CharGyse Hi - best kind of account for your wealth account is a deposit account with interest. BTW I just read Tony Robbins' new book which, as Step 1 of his 7 Steps to Financial Freedom he calls the wealth account a 'freedom account'. I like that!
Thank You!!!! I have been working on Managing my Money. It seems to come in from everywhere and go everywhere. =) This really helps me understand a simple solution for paying bills, knowing my cash flow, and investing. Also I love that the 1st one is called clearing, it puts a new mindset into paying bills. I am clearing them out of the way so that I can focus on my wealth. =) Gratitude Gratitude Love Krysta Bell
Roger- The MMP Playbook #3, Measure Your Money, mentions a mirrored Debt System with Debt Accounts. With a business in Infrared, we deal with credit card debt, loans and business credits. Can you do a similar video for the debt system and how to integrate the Cash and Debt system and prioritizning flows into each system. Thank you.
Hey Roger, Love those rose petals and stones in the grass. Perfect teaching tools lol. Question: Can investing in myself for courses, coaching / mentoring programs, etc. come from my Investment account? I do have a separate Education part of my budget, but I funneled a lot more money over time into my Investment account. And then I justified the expenses by saying, "Well, the best investment I can make is investing in myself. I need to learn before I can earn..." Now that I'm writing this, maybe I should just budget separately for "investing in myself," so I'm clear on how much there is to invest in me vs. actual investments. What do you think?
Sunni Sukumar The best way to invest in yourself is to set up a business and make it a business expense. That way it needs to be justified by the business making profit, and that's where you'll see a return on investment
Hi Roger, thanks for the great training. Need clarity. If we're always putting all the dividends/returns from our investments (fast lane) back into our investment account and not in Cash or Checking, then at what point do we pay ourselves to spend on our bills and lifestyle to become 'financially free'? And what portion of it?
Shiraz Khan You can create a lifestyle out of your investments. For example Richard Branson lives on Necker, but he owns that through his business. Then the earnings you pay yourself from either the 3rd lane (from your businesses) or from the 2nd lane (a trust fund or salary from your holding company) will cover your costs without you needing to work (except on the things you love)
Hi Roger, I'm a little overwhelmed here as I am an Australian living on the borders of Switzerland and France. So I have a personal account in Aus, a personal account in France, and personal, plus business, plus credit card in Switzerland. I need them all as I have to pay bills from both Switzerland and France and I'm trying to save into the Aus account for when I return (hopefully in a year). So I thought your idea of Mint or Xero would help however they dont seem to be able to take accounts from multipal countries and currencies? I've been trying to find one through online searching but not having much luck. Can you (or anyone else out there that has had this issue) please help me with how to set up this plumbing system so it will work for me. Thanks so much. Kind Regards Tammy
Hi all! I am a Dynamo genius in France, and would love to set up my team. Any steel, tempo and blaze geniuses in France or Europe who would be interested?
![Noob To Max With DRAGON REWORK In Blox Fruits [FULL MOVIE]](http://i.ytimg.com/vi/LnBMOinoOvA/mqdefault.jpg)
starting to now see that making a business / money work is not magic but to a large extent process. Thanks Roger, keep 'em coming!
Roger - I made a decision last month when I turned 46 that I would finally "figure out" this financial thing and that my future would alter to allow for the success I know I can create with my business. I read your book and then sat with the fact I was in red and no idea how to get to orange. Then I had opportunity to take online hours at my day job so I could start to pull out of red into Orange. I still felt bewildered that orange was elusive as all the debts and expenses increase commensurate with income increase as you've pointed out. Still I've been hopeful and watching your videos to see what I can glean that I have never gleaned before. BIG LESSON: putting all my eggs in the entrepreneurial basket for so many years at expense of personal /household wealth. My husband did the same. Together our ship sank - with children aboard. But THIS particular video really speaks to me and makes me wonder how come I never figured out what you've so simply illustrated. I am now chomping at the bit to create these four accounts and to simplify my financial life and influence people around me to do the same. Onward!
Kennerly Clay Great! Our future always begins today, so good to learn from the past - but even more exciting to focus on the future!
Thanks for sharing the story of your sinking ship. Inspiring to see you still motivated to learn the lessons and start again to move up the lighthouse. Wish you all the best with it.
Thanks all - I appreciate the camaraderie and understanding the journey more and more!
Oh my goodness, Roger you have just given me a huge revelation!!! Until I have earned the right by managing my personal finances, my business will not grow to the level I know it can get to!!! A have set up a jar system for myself and my kids where we put money into 6 different jars, more like the lanes, but this has simplified it so much more!!! Thank you, thank you, thank you.
Nozipho Hoohlo Nonyana Great. Now follow it and see the magic a year from now :-)
Definitely. And I plan to be in Bali for the iLab mid 2015.
Many thanks for the effective plumbing system, Roger!
I've already started implementing it and I'll tell you the outcome in 3 months time!
Roger, I really like this concept, but I have a few questions:
1) If you have a main business that gives you your primary income (say you're a freelancer for example), would you pay yourself into your clearing account, or into the investment account?
2) Where would you put savings and other money that is not directly for investment? Would you have a 5th savings account somewhere?
I recently read a great book call Low Cost High Life where the author (Mark Homer) outlines a similar idea he calls the "bucket system". In it he says to divide up your income as follows:
1) 55% Bills and living expenses
2) 5% Giving/charity
3) 10% Investments
4) 10% Investing in yourself (education/networking)
5) 10% Bucket list (fun stuff to reward yourself)
6) 10% Save And Never Touch (high interest savings to which you can eventually live off just the interest)
I think my wife and I are going to create a hybrid system between your model and this one.
Finally, a another good money tracking system to check out is www.pocketsmith,com
Mark Hazeldine Hi Mark - Pay yourself a fixed monthly salary into your clearing account, so you're always covering bills and cash expenses. Then every three months, as you make extra profit, pay yourself a dividend into your investment account
Mark Hazeldine As for savings - you can have extra 'vehicles' in the fast lane which include high interest savings accounts or multi-currency accounts, which are effectively investment vehicles in the form of cash with low risk, low return.
Thanks for clearing that up Roger. Good suggestions!
Thanks for sharing this great idea of setting up 4 Bank accounts, Roger! I will set this up for me asap! ( You are right this not only will help you with your Personal Finance but with my Business I plan to start as well!). Thanks Roger for another Awesome video! as I like and learn a lot from all of your videos! Later! Walter from Utah, United States.
Excellent, thank you Roger. Can't wait for the next one.
Thanks for this Roger, I set this system up personally when you were with OneLife, however, never thought to do that for Bloom. Beryl is onto it! PS Love the petals and stones, cute!
Rustica Lamb Great!
Roger-Q& A Reminder for Debt Systems and Debt Accounts.
Thank you.
I've known about this system of money management of yours for a while now Roger but still had not set it up. Got on the phone to the bank today and was able to do it in about 15 minutes. :)
Like many other people here I too have experimented with the jars/bucket system that people have mentioned but this is a great way to keep the money in the bank physically separate.
Kevin James McAuley Yes - While the jars system is a nice idea, it doesn't scale to when you have millions flowing through :-)
Good point. If your making a million and spending 55% on expenses probably want to have a look at your lifestyle haha.
This is worth a shot. I'm supposed to be a Mechanic, anyway, so let me tinker with Mr. Hamilton's system a little. :D
Hi Roger, I love your plumbing system the first time I saw it on GeniusU. I definitely have the experience of having a leaky plumbing system. Although I was an accountant before and I had a personal budget, I find that tracking money each month was tedious. Plus, when I started invested and business, all my money get meshed up together. I don't know how much to spend on each category.
I have a of questions about the plumbing system:
1) If you have one-off big expenditure such as travel and education/courses that you don't spend on a monthly basis, where does the money go? The cash account?
2) Does your business has a plumbing system too. If so, is your business plumbing system similar to your personal plumbing system?
Nerdy Creator As much as possible, 1) should be billed through your business so they are a business expense and then focus on the business giving you a return. If it is for a holiday then yes, only go if you have the money in your cash account to afford it! For 2) yes you can set up your business like this too. All big businesses, banks, stock exchanges and entire countries etc use clearing accounts - For example the US Clearing House Network cleared $39 trillion last year, always with $0 balance at the end of each day...
Roger James Hamilton Got it. Thanks Roger! :)
Awesome video on the effective plumbing system thanks Roger
I couldn't wait to tell my husband about this! I know I said this before, but the mere fact that you are teaching us life changing, mind shifting concepts, PLUS you still take time to answer all these questions says a lot about your heart. I am so touched by the help you are giving us.
so I have an IRA that I have no idea what is going on with it(for like 20 yrs now, im so embarrassed). Im just "trusting" someone to handle it at scottrade. when you say the money from the fast lane like dividends should go back to the middle lane, how do you do that with a retirement account
and I have had not great experiences with finding a cpa-I only want one who understands your concepts, should i google cpa who listens to roger hamilton?..LOL seriously though that will be a qualification now that I am learning from you, thank you
Michelle StayingHomeMom Take control of your retirement account! Have a read of Tony Robbins' new book Money: Master the Game for details on how to do that.
Roger James Hamilton
ok great thanks...
Roger James Hamilton
got the book and will listen while at work.. i always listen to books not music while working(multitasking)lol, loved all of your wealth cd's now I will go back and listen again so I can actually apply and take action
I shared this video with my little sisters. On Monday I'll be helping one of them set theirs up.
I got mine set up this November, but I was wondering, what kind of bank account is best for the wealth/investment account? At the moment I have three current accounts for cash, checking and clearing, and I'm using my e-isa as my wealth account.
Will that do, or should there be a fourth current account that is called the wealth account, where money is put first before being transferred to savings accounts or bonds or other kinds of investments when the time comes? Hope my question makes sense, cheers :)
CharGyse Hi - best kind of account for your wealth account is a deposit account with interest. BTW I just read Tony Robbins' new book which, as Step 1 of his 7 Steps to Financial Freedom he calls the wealth account a 'freedom account'. I like that!
Thank You!!!! I have been working on Managing my Money. It seems to come in from everywhere and go everywhere. =) This really helps me understand a simple solution for paying bills, knowing my cash flow, and investing. Also I love that the 1st one is called clearing, it puts a new mindset into paying bills. I am clearing them out of the way so that I can focus on my wealth. =) Gratitude Gratitude Love Krysta Bell
Roger- The MMP Playbook #3, Measure Your Money, mentions a mirrored Debt System with Debt Accounts. With a business in Infrared, we deal with credit card debt, loans and business credits. Can you do a similar video for the debt system and how to integrate the Cash and Debt system and prioritizning flows into each system.
Thank you.
Thomas Watson Sure Thomas - will talk about this in the upcoming Q&A vid.
Hey Roger,
Love those rose petals and stones in the grass. Perfect teaching tools lol.
Question: Can investing in myself for courses, coaching / mentoring programs, etc. come from my Investment account?
I do have a separate Education part of my budget, but I funneled a lot more money over time into my Investment account. And then I justified the expenses by saying, "Well, the best investment I can make is investing in myself. I need to learn before I can earn..."
Now that I'm writing this, maybe I should just budget separately for "investing in myself," so I'm clear on how much there is to invest in me vs. actual investments.
What do you think?
Sunni Sukumar The best way to invest in yourself is to set up a business and make it a business expense. That way it needs to be justified by the business making profit, and that's where you'll see a return on investment
Roger James Hamilton Thanks, Roger! That'll help my clarity when deciding.
Thanks Roger!
Hi Roger, thanks for the great training. Need clarity. If we're always putting all the dividends/returns from our investments (fast lane) back into our investment account and not in Cash or Checking, then at what point do we pay ourselves to spend on our bills and lifestyle to become 'financially free'? And what portion of it?
Shiraz Khan You can create a lifestyle out of your investments. For example Richard Branson lives on Necker, but he owns that through his business. Then the earnings you pay yourself from either the 3rd lane (from your businesses) or from the 2nd lane (a trust fund or salary from your holding company) will cover your costs without you needing to work (except on the things you love)
Hi Roger,
I'm a little overwhelmed here as I am an Australian living on the borders of Switzerland and France. So I have a personal account in Aus, a personal account in France, and personal, plus business, plus credit card in Switzerland.
I need them all as I have to pay bills from both Switzerland and France and I'm trying to save into the Aus account for when I return (hopefully in a year).
So I thought your idea of Mint or Xero would help however they dont seem to be able to take accounts from multipal countries and currencies? I've been trying to find one through online searching but not having much luck.
Can you (or anyone else out there that has had this issue) please help me with how to set up this plumbing system so it will work for me.
Thanks so much.
Kind Regards
Tammy
Can you redo it for those of us who drive on the left?
Kyron Gosse Should work fine if you watch the video in a mirror
Hi all! I am a Dynamo genius in France, and would love to set up my team. Any steel, tempo and blaze geniuses in France or Europe who would be interested?