Why do you own your own building company?
For some, it may be a case of being your own boss…
Others see it as a way to earn more money and improve their lifestyle...
For most though, it’s a combination of the two and that really equates to one ultimate goal which is to achieve financial independence…
And in order to achieve financial independence, you need to figure out a way to generate passive income.
Warren Buffett once said, “If you don’t find a way to make money while you sleep, you will work until you die.”
That’s harsh, but the Oracle of Omaha knows what he is talking about.
Consider this, just $1 million invested at 7% a year generates more annual income than the median American household makes working nine to five!
Historically, people who learn how to invest their money and generate a passive income successfully see both their income and their wealth snowball over time.
But far too many business owners simply don’t know where to get started.
Financial independence has never been easier
And by not planning to generate a surplus income that can be invested to produce a passive income, they never get started.
However, getting started on the path to financial independence has never been easier.
Today, it is easier to invest and track your surplus income than ever before.
And the beauty is, once you get started, you begin to look at money in a different way.
If you follow the 4% rule, which a lot of followers of the FIRE movement (Financial Independence, Retire Early) do, then every $10,000 you invest will return you $400 a year in passive income, while also growing at a pace that covers inflation.
What that means is that if you have a $240,000 a year lifestyle, then you need to reach $6 million in passive investments to reach financial independence.
It’s fair to say the 4% rule does not work for everyone, or in every situation. Therefore I’m not attempting to give you any investment advice, I can’t, I have no idea about your unique circumstances.
However, I use this as an example of why it is so important to think about building wealth and investing money outside of owning your own home and business.
It all starts with a business plan
And what that typically means for most business owners is reassessing their margins to a level that generates a net profit.
The benchmark NET profit for a residential building company is between 10% to 15%.
The reality for over 95% of residential building companies is less than 3%, and in the vast majority of those builders, it’s actually less than 1%.
The owner of the company literally has a job rather than a business.
So how can we fix that and generate surplus net profits that can be invested in order to generate a passive income that will allow us to work less and become financially independent?
It all starts with a business plan.
However, creating a business plan on its own is not enough.
Because most business plans are flawed.
They contain some fundamental errors that reduce their impact.
To be clear, a builder with a flawed business plan will always outperform a builder with no business plan!
However, better information leads to better decisions. So the more accurate the plan, the better the end result.
If you’d like to follow the APB step-by-step process for creating a plan to grow your building company safely and securely, then click on the link below and take a look behind the curtain in order to see the templates and tools we are providing to our members.
This video will reveal how you can generate more quality leads and more sales at higher margins while improving the building experience for your clients.
Click the link below to watch the demo now.