Wealthy Pulling Ahead
Wealthy pulling ahead: StatsCan
(September 24, 2007) The majority of Canadians saw little improvement in their real income between 1992 and 2004, according to a study by StatsCan released today. But life was considerably better for the 20% of the population earning the highest income.
“Between 1992 and 2004, constant-dollar income for people in the top 20% of the tax-filer population rose substantially, and the gains got bigger the higher up the income distribution,” the report says.
To make it into the top 5% of tax-filers, Canadians only had to earn $89,000. An income of $181,000 put them in the top 1%, while those earning $2.8 million or more found themselves in the top 0.01%.
Not surprisingly, Canadians between the ages of 45 and 64 made up the bulk of the wealthiest 0.01%, representing three out of five in the cohort. Seniors made up the second largest group in this highest bracket, at 23%.
Of the top 5% of tax-filers, 46% lived in Ontario, 18% in Quebec, 15% in Alberta and 13% in British Columbia.
Wealthy families tended to live in large urban areas, with 51% of those earning in excess of $250,000 per year living in Toronto, 11% in Montreal, and 8% in both Vancouver and Calgary.
But do you know why the wealthy saw more improvement over the rest of Canadians?
Because of what I have been saying for a long time now – Leverage!
The wealthy realize and harness the great and awesome power of this concept.
“Doing ever more with ever less”.
Or another way of saying this is to: “do the work once and get paid for it again and again”.
Remember, what you lack in skill you can always make up for in LEVERAGE!
A rental property?
A dividend paying stock?
Income paying mutual funds?
Because you need only buy the investment once – and it will continue to pay you income for as long as you hold the investment!
If it weren’t for this little truth I would have nothing of value to share with you.
All you have to do is master the art of leverage and that’s what I’m here for.
To help you increase your potential for financial and personal success by introducing you to the appropriate products and systems that will free you up from the tyranny of living “pay check to pay check” like the majority of Canadians do!
The Power Of Leverage – Maximum Success in Minimum Time…
The concept of leverage is all about achieving “ever more with ever less”.
Getting better results with less and less effort – time after time.
Leverage is THE key to ANY success – and by extension personal success.
Other examples of leverage are authors and recording artists. They produce a book or a recording once and get paid royalty checks for ever. What a concept. What a great notion to aspire to.
The wealthy understand and use 5 areas of leverage and you will want to begin using them too.
1. Leverage through money. This notion most people understand but far too few actually implement. Take an investment property for example. You leverage other people’s money once and receive rental income and capital appreciation for as long as you hold the property. Income investments such as income and dividend paying securities and mutual funds also fit the bill here.
2. Leverage through systems. McDonalds is the classic case for running and managing systems. The term SYSTEM stands for “Save Yourself Time Energy and Money”. Any system that you have for doing a task in your business – if it is known only by you – is counter productive…Write it down, photograph it, record it, make a video of it – and then you have documented a basic system that anyone can understand and follow. Systems are key to successful leverage in business.
3. Leverage through people. Train your people once and have them work for you long-term. Too many business owners try to do it all themselves to save money. Their time should be spent on other things – not the repetitious and the mundane – pay someone to relieve yourself of these burdens. You are far better off to pay someone to do a $10 an hour task so that you and your time is freed up to be able to charge yourself out at $100 an hour!
4. Leverage through customers. This is the one to really focus on if you are in business or contemplating getting into business. Do the work once (get a customer/client). And get paid over and over again (keep them as a client for life and get the financial benefits of their repeat business). If you have the business set up correctly and treat your customers with care and respect you will have them coming back again and again…
Leverage is crucial to your long-term success in business and your wealth creation plans.
So constantly ask yourself – “Am I being paid once for this activity – or forever”.
The answers to that question should immediately and dramatically change things around for you!
For example, I wrote this only once.
However, you and others like you have already read it – and others will be reading it…
About The Author
Mark Huber is a full time practicing certified financial planner (CFP).
Mark has distilled 22 years of insights and experience in the financial services industry into “The UnCanadian Way” series of eBooks, audios and videos.
For the latest: “How To Get Rid Of Your Mortgage – The UnCanadian Way”
2008 Mark Huber
This article may be freely distributed if this resource box stays attached.
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