The Latte Factor | David Bach

Three Secrets

1) Pay Yourself First

Keep your first hour’s worth of each day’s pay. An hour a day, in other words, of paying yourself first.

2) Don’t Budget – Make It Automatic

3) Live Rich Now

The first two secrets – pay yourself first, make it automatic – those are the how. This is the why. Figure out what matters, and follow that.

If you don’t know where you are going, you might not like where you end up. What am I doing with my life?

Oculus, it means figuring out where you want to stand. Where you stand, and what you see from there, is the key to putting together the right Picture. That’s what creates the perspective you want. The picture happens first in your mind’s eye. Before you shoot. That picture is where everything starts. That picture is what guides it all. Your oculus. Where you stand, and what you see from there, is the key to putting together the right picture.

The latte factor isn’t about being a penny-pincher or denying yourself. It’s about getting clear on what matters. It’s about the little daily extravagances and frivolities, whatever they may be – the five, ten, twenty dollars a day that you could just as easily redirect toward your own future.

When you pay yourself first, what you are really doing is putting yourself first. 

Life is paradox, and sometimes the only way you can serve others is to put yourself first.

It is usually the simplest ideas that change people’s lives, not the complicated ones. Sometimes the simplest truths are the easiest to overlook. Or to dismiss as well, as too simple.

Down in Texas they have this expression, “Big hat, no cattle”. All show, it means, and no real assets to back it up.

You build your health the same way you build your wealth. One bite at a time. Your health doesn’t just happen; it is not something that takes care of itself as you go through life. You can’t leave your health in someone else’s hands, and the same goes for your wealth.

Money is the biggest reason marriages fail – but it is not money itself, and not even the lack of money. It’s the lack of talking about it and working it out together.

When you grow your income bigger, you just take whatever money problems you have and make those bigger, too.

The solution to your money problems isn’t more money; it’s new habits. It’s about shifting your everyday habits, just a little. And with that little shift, changing your destiny.

By and large, the wealthy spend their money on things that truly matter to them – no more, no less. It’s the unwealthy who spend money on frivolous things.

You know how to make your dreams come true? You buy them… a dollar at a time.

Do I take the safe route, where I think I know the outcome? Or do I take the riskier route – the one where I hope the real gold lies, but the path to get there is uncertain? Two voices: the big-boy voice that says, “Be safe, go to the safe road!” And the little-boy voice that says, “Go this way! It’ll be fun! Let’s try! That voice, the little-boy voice, the one that’s excited and wants to play – let that little boy come out and play. And tell your friends to do the same.