When I was in high school, I’d often think to myself "how much money will I make when I graduate from college?"  I hated not knowing the answer, but like a good little boy, I figured if I went to college and studied hard, I’d get a good high-paying job.

But there was a problem.

I soon learned that how much money I made wasn’t relevant.  The only question that mattered was "How much will I KEEP?"  Let me explain.

After reading books on personal finance and wealth building, including Rich Dad Poor Dad , Cashflow Quadrant, Increase Your Financial IQ , and others, I better understood that the poor and middle class focus on their top line and not their bottom line .

As I’ve said before, your life is a business, and no one else will watch out for your bottom line but YOU.

3 Forces That Hurt Your Bottom Line…Preventing You From Keeping More Money

There are 3 forces working against you at all times to help keep you trapped from finding the financial freedom you desire.  They are:

1. Debt
2. Taxes
3. Inflation

Let’s look at each of these…

1. Debt
   
   • Debt is encouraged as a way of life.  Student loans, car loans, mortgages, easy financing options on computers, TV’s, etc.  Never-ending debt both personally and nationally leads people to distance themselves from financial freedom.  The sad part is, our entire system of money world-wide is built on debt for expansion since none are backed by any sort of tangible good in limited supply (like gold).
2. Taxes
   • For a detailed breakdown of all the different tax structures and how they impact your money, read How Taxes Eat Your Income: It’s Not How Much Money You Make, It’s How Much Money You KEEP That Matters . The tax code favors business owners; they provide the jobs to keep people employed, who pay the most in taxes.
3. Inflation
   • This occurs when governments print money or continue to issue government debt to finance operations.  This inflation mortgages the future of the country and its people.  This leads to higher taxation or price increases later.  So long as there are currencies backed by nothing but the "full faith and credit of the government" then there will be always be monetary inflation.

These 3 forces are responsible world-wide for many financial ills.  While you have limited control of government spending, you can control how you function within the system by reducing these negative forces on your finances.

What To Do About Them

1. Debt
   • Don’t take any on unless it will make you more money.  This can only happen when the cost of borrowing is less than the cash generated from the business or real estate investment that the loan was taken out for.  Happiness is positive cash flow.
2. Taxes
   • Minimize taxes through corporations and efficient use of tax deductions.  Consult a CPA.
3. Inflation
   • Do your best to invest ahead of inflation.  If you do not know of better yielding investments, seek out better information that will lead you to discover better rates of return.  They are out there.  Here are a couple of resources…
     • City Capital Corporation : invests in real estate and cash flowing businesses with good returns.  Allows you to use either your money or your credit to invest in deals.  (Minimum income and credit score requirements apply)
     • Lending Club : allows you to directly lend to other people with rates from 6-19% after their service charge

Once you understand the 3 Forces That Prevent You From Keeping More of Your Money, you’ll have a better understanding of what it takes to make, but more importantly keep , your money.

Happy investing!