Step 19 - Amazon.com & The $32,000 Brain Budget

This lesson explains where to spend your money, because it is essential for the man you ought to become.

The idea is, that you should calculate and track your discretionary income, which is your income minus your fixed expenses, like rent, to be able to spend money on matters that matter.

In general the idea is to spend 30% of your discretionary income on your brain. It can be books, seminars or even a tour to a place where a highly educated person lives. Seriously, if you have $100 discretionary income, spent $30 on your mind. If you have $100.000 residual income, spent $30.000 on books and seminars. It's a matter of ratio and less a matter of amount.

The other 30% of your discretionary income should be spent on life, because you need social intercourse and fun because life might be over tomorrow.

And the last 30% shouldn't be spend at all, they should be saved.

To start doing this, get a sheet of paper or use excel and track your income. Then calculate your exact discretionary income. After that you can do the math yourself. But remember that Amazon.com should become your friend. Don't be penny wise and dollar foolish. Be dollar wise.

Spent

  • 30% on your mind
  • 30% on life
  • 30% for savings

Questions

  1. Right now, what is the discretionary income that you have available to you?

    I'd like to keep this amount for myself.

  1. How are you currently spending it? In other words, what minors are you majoring in?

    I saved a lot of it. And when I spent it, I did it on a suit, books, mentors and a few bucks on some socializing. Would say about 60% mind and cloths, 30% on mind, 10% on socializing.

  2. What are you going to reinvest in?

    I'll book probably a seminar in mnemonics and speed reading. Also in gifts and dinners for mentors and mentors to come. Also I am going to enroll in a university course in economics. Then probably some more books of Tai's list.