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Portfolio of Motivation

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Table of Negotiation


Additional articles:

Get Rich After Retirement

Never Break the Copper Rule!

Barter Page

Step Thirteen to a Fortune:

photo of car wash supplies

Experiment Title

A Penny Saved is a Penny Invested

 

Vision

Two Visions is Better than One

There are times where more than one action will be required to get the outcome we invision.This will be the first Deal where more than one deal is dealt with.  We had a complete failure that will count against capital as a one time expense, then we had the subsequent deal that was successful. 

1. My wife bought a couple of picture frame keepsake boxes for $.50 each.  They were pretty nice and really cheap but we just couldn't sell them.  Evidently China had flooded the market with these and our entire market base had already bought all they could stand of these super bargains.  I don't want to linger on the loss as the law of attraction might attract more, so we will tighten up our pre-buy research (due diligence) and move on.  We charge $1.50 against our capital fund. 

capital before the picture frames $36.27

capital after the $1.50 loss $34.77

2. After this failure I wanted to do something where I was in control rather than market forces.  The course of these deals follow my own agenda.  As others follow their own plans they must look more like the people who are doing them than my own.  If I were to be doing these deals only for the instruction of others I would not do this particular deal they way I did. 

My purpose during this time period was more to my own interest.  I had a new truck and was washing it a couple of times per week.  It had a finish on it that required to be wiped dry or every water spot would show and even possibly spoil the finish.  I was spending $5 to $7 in quarters each time I went to the car wash.  If I drove through one of the auto washes it would cost up to ten dollars for the full fancy wash.

My next vision was to invest in a couple of tools to make it easier to wash my truck at home.  I bought a bottle of car wash soap and a spray attachment to fit on the end of my water hose to dispense the suds and turn from clear rinse to suds.  My plan was to wash my car at home and save the money I had been spending so freely.

 

Objective

From $36.27 (reduced to $34.77) in reserve capital I prepare to risk up to $2.59 (the scheduled amount for this step) looking for a return greater than $2.85

Hypothesis

If you save a penny, you've earned a penny.  If you invest your savings you'll grow richer!

Procedure

We wrote off our loss, adjusted our capital base, and invested in a new plan to save money.

I bought a bottle car wash soap and a spray attachment to fit on the end of my water hose to dispense the suds and turn from clear rinse to suds.  I washed my car many times over the next several months saving many more dollars than I count here.

I paid $12.99 for a super sudzer, $5.99 for spray nozzle, $4.99 for Zip Wax Wash, and $1.73 for sales tax.  I invested $25.72.   This is about ten times more than I was scheduled to be risking, but I was spending a small fortune of my personal money on these car washes.  I could see a way to save myself some money and put a part of the savings to work in my capital base. 

I've got my equipment.  Now I  have to use it.  I don't know what the extra water will cost but not much.  I'll only pay myself $4.00 for each wash I do.  When I tripple my investment, I'll stop charging myself and donate the equipment to a worthy cause....the customer....me!

After 20 washes I stopped paying myself and moved on.  20 X 4= $80 - $25.72 = $54.28 in profit.  It took about two months for this one.  Eventually I lost interest in washing it so often.  Now the trucks lucky if it gets washed once a month.  The nice thing about dirty trucks is they only get so dirty then the old dirt falls off.

Working capital after the small loss was $34.77.  Profit from two months of car washes was $54.28.   Uncle Sam doesn't tax us on the money we save so this money comes right out of my personal pocket into my penny capitalist pocket...no deductions.

New capital base is $89.05

 

 

 

 

Ending capital available for new investment                     $89.05

 

Questions

 

Why did I risk so much of my capital?  The whole point of penny capitalism is to invest in growing increments learning to handle all facets of each level as we go. Especially since we just lost our entire investment on the picture frames, why would I risk so much on this one?

I could lose the whole thing and have to start over.  As I said, I was spending a lot of personal money washing my truck.  I was in full controll of that money.  I wasn't likely to stop washing my truck anytime soon, so this investment seemed like a sure thing.

Life doesn't follow straight lines; it curves.  It skips, hops and jumps. 

I did this and it worked out! 

What can I learn from this experience? Ben Franklin was right!  A penny saved is the same as earning a penny.  We should be very carefull not to mingle our investment money with our personal money. 

Conglomerate Companies leverage profits off their various subsidiaries.  This is very similiar to what I just did, only on a less commercial level.  It is not a good idea to make a regular practise of this, but sometimes the opportunity is just too great to pass up.

Exercise extreme caution!

 

Conclusion or Final Result

A saved penny has the same capital as an earned penny.  When we see an opportunity to save money, we'd be foolish to ignore it.

capital before the picture frames $36.27

capital after the $1.50 loss $34.77

 

  Starting capital   before loss                  $36.27

                  capital after loss                  $34.77

Investment return goal                          >$2.59 with a net profit of >                                                                           $.24

actual investment  required                     $27.72 (supplies)

 

                                                                  

                                       total arbitrary gross revenue =$54.28

                                                             

                                                                 

                                                                                                       

                                                                             

 

Ending gross capital before deductions          $89.05

 

 

tax and contributions do not apply

Our new capital has grown to  $89.05 investment and surplus for future deals.

Next Step 14