You Must Show Work To Receive Credit: Fill & Download for Free

“I’m rich! I’m making tons of money!”“You may feel rich, but you will never be wealthy!” I interrupted Pete who was expressing his joy after getting a new job.“What does that mean?” he asked with eyes wide open.I returned his question with a question. “What are you working for, Pete?”“Uhh, Hector! Obviously I’m working for money! I want money! Show me the money! I want to have lots and lots of money!”“Well, Pete, if you’re working for MONEY, if your goal is accumulating MONEY, you will NEVER be wealthy!” I said.“WHAT? You are wrong, Hector! I’m accumulating MONEY! I work, for money, that’s why I work really really hard!”“Pete, you are confusing money with wealth,” I answered in a calm voice to get his emotions under control. “Let me ask you something. How much do you make per hour?”“I got a raise from $120 dlls/hour to $200 dlls/hour! I’m making huge money. Last week I celebrated by buying a Mercedes for my wife. She was so happy. I’m so happy that I can afford all her dreams.”“You can’t afford it, Pete!”“What do you mean I can’t afford it? I just did! I have the car at home now!”“How much did you pay for the new car?” I asked.“Ohh, you need to see it to believe it! It’s that SUV, with all the gadgets you could ever imagine. It’s a $90,000 beast!” Pete said proudly. He couldn't contain his emotions. It meant success for him!“How much cash did you pay?” I asked.“That's the best part! The financing was unbelievable! With my new payroll, I qualified in a heartbeat! I charged my credit card with a small 10% down payment, just $9,000!”“You couldn't afford it, Pete! That was a bad decision!”“I deserve this! I worked hard for this! I make $300,000 a year! I’m rich, Hector! I can buy all my gadgets. I love my boat, my motorcycle, my cars … and when you visit my media room at home, and listen to that audio, your pants will drop!”“No, Pete, your pants will drop the moment you realize that you are working for money. You are working to accumulate stuff and you will never accumulate wealth! The moment you lose your job, you will be living in hell!”“Shut up, Hector! Don’t even mention it!” he quickly replied.“Pete, wealth is only found in assets, not a job. People who own assets are wealthy. Assets increase their value over time or better yet, the best assets make money for you. That is what real wealth means.”I continued.“I invite you to see money through a different lens. Money is a tool, a medium of exchange. Money is simply a unit of measurement used in the act of giving and receiving. Money is just a source of energy.”“I don’t get it, Hector!”“Pete, you make $200 per hour. That’s amazing! But have you noticed you owe hundreds of hours of work to pay for your lifestyle? How much do you owe today?”“About $500,000, including the mortgage on my house. I am not worrying about it because today I am able to make much more!”“Do the math, Pete. Convert your debt into labor hours! You make $200/hour. Good, but take away taxes, around 30%, take away cash invested into your IRA, 401K, etc. Effectively, you have available around $130/hour.”“Correct …” Pete said attentively, trying to find something to prove me wrong.“Let’s divide $500,000 / $130. That’s 3,846 hours of work you owe. You don’t owe money, you owe time! You are hooked! You don’t have the assets to cover your debt. You are the only source of income. Your work, your labor, your time.”“That can’t be right!”“You can’t afford all those things! You must start accumulating assets!”To answer your question: What’s the best money advice I have ever received?Think of money this way: Spending more money than you earn, is consuming more value than you produce. It isn’t money owed; it’s a deficit of your TIME.If you don't own any assets, your TIME is the only source of VALUE you have!DEBT = PRODUCED VALUE - CONSUMED VALUEPete has a debt of $500,000. This means he has consumed $500,000 more value than he has produced. The debt that Pete has with the Mercedes is a promise of future production of value!This is why COLLEGE DEBT is so dangerous!Debt is modern slavery — young generations attached with student debt require future work to pay back — even if they can’t find work!Invest your hard work wisely — invest and accumulate assets, not junk!

1. Financial vs. Managerial: Accounting has two main disciplines: managerial is the one you use internally for keeping track of things and financial is the one you present externally to investors, banks and the government. For instance, in your managerial accounting you will enter the day-to-day expenses and sales, while your financial accounting will be a summary of all those transactions.2. Double entry book-keeping: Every transaction must be entered in two accounts and these must eventually balance. This ensures that you are on the right track. Although accounting is as old as human civilization, double entry book-keeping was invented only in the 14th century. Fundamentally, all an accountant does is balance the books - make sure all the transactions are entered in two accounts and they all eventually balance (like the last line in the image below).3. Assets & Liabilities. These are the foundations of accounting. Assets include everything you own - your home, car, factory, equipments are all your assets. Liabilities include everything you owe - this includes all your loans. A lot of transactions involve increasing both. For instance, when you buy a home with a loan, you increase both your assets and liabilities.4. Equity. The gap between assets and liabilities is your fundamental worth - equity. For instance, if you own a car worth $10,000 and your auto loan balance is only $3000, your equity on the car is $10,000 - $3000 = $7000. If your overall equity is less than zero, that means you are broke.Equity = Assets - Liabilities5. Credit vs. Debit. This is the yin & yang of accounting system. Credit (Cr) is an entry that increases your liabilities and debit (Dr) is an entry that increases your assets. Debit in general means adding a positive number to an account and Credit in general means adding a negative number. Credit is traditionally written on the right side of a ledger, and debit is usually written on the left side of a ledger.6. Ledger. The image that you see above is a part of a ledger. A ledger is a principal book, where you enter the money transactions in the format above. Companies typically keep 3 types of ledgers: General Ledger - for keeping track of all expenses, income, assets, liabilities and equity, Sales Ledger - for keeping track of customers who have purchases, but not yet paid for their goods and Purchase Ledger - for keeping track of all purchases we have made for which we have not paid yet.From the ledger, we create financial statements that summarize a company's overall position. International standards mandate companies to keep four main types of financial statements. See: Financial statement7. Balance sheet - This is the snapshot of a business. It states how much assets are there in various categories (bank accounts, buildings, equipments and the amount you need to receive from your customers), how much liabilities are there in various categories (short term loans, long term loans, amount you need to pay your suppliers) and the overall ownership equity - how many shares of the company are held and how much money was got from the owners.8. Income statement - This records the incomes and expenses in various categories. For instance, following is a part of Coca Cola's income statement. http://www.thecoca-colacompany.com/investors/pdfs/form_10K_2011.pdf You can see that they have made $46,542 million (top line) in 2011 and are left with a profit of $8634 million (bottom line). Given that the profits are written in the bottomline, you have this common expression bottomline that refers to the final results, while topline is used to show the overall sales that a company makes.9. Cash flow statement - If you have run a business, you know that cash is the king & it is very important to understand how a business manages its cash. For instance, if you have made a sales of $10 million, but none of your customers have repayed yet, you can no longer afford to be happy that you have made $10 million in sales. The cash flow statement records how a company got and spent its cash. The cash flow statement shows whether the company is growing its cash and how it is spending the cash (new equipments, repaying loans, paying more wages, etc).10. Accounting is not an exact science. Accounting, contrary to popular perception, is not an exact science but involves a lot of judgment. For instance, if 3 of your customers have not paid in 6 months, you must decide if you have to keep them in the account receivable or write it off. Also, you are required to understand tax policies, how inventories are increasing/decreasing in prices and what is the lifetime of the assets you are own.See more: Basic Accounting Concepts | AccountingCoach.comWikipedia: AccountancyRelated:Balaji Viswanathan (பாலாஜி விஸ்வநாதன்)'s answer to What should everyone know about investing?What should everyone know about economics? Which websites or books do you suggest for someone dipping their toe into the subject?Balaji Viswanathan (பாலாஜி விஸ்வநாதன்)'s answer to How does the stock market work? Who decides the price of stocks? What is the logic behind the valuation of stocks?

You should completely forget about yourself first. It includes your habits and daily routines. It includes your past family-connection and love relationships. It includes changing your hang-out spots, restaurants you like to visit and friends you see.The Secret Service focuses on your behavior and repetitive lifestyle patterns to spot you or follow you. They try to find your weakness i.e. need to consume alcohol, girls, drugs, sex, or anything you need to do regularly . If they know your weaknesses, it's just a simple waiting game for them until you return to your usual spots.It's extremely difficult to follow anyone 24/7 as it is resources intensive but it’s also very easy to find someone given you know their weaknesses.Have you wondered how police or any security agency look for the person after he is declared as “wanted”? Or how they surveillance anyone for collecting evidence?There is a fundamental mistake all criminals make, which is getting into a routine and being overly confidence for whatever reasons. Even if they know that they are being followed, they just don't care as they think they can keep outsmarting law enforcement.For example,John Gotti had plenty of chances to disappear with all the money he had and live peacefully, but no! He had to brag, get lots of attention from the media and thought he was smarter than law enforcement.The interesting thing is his right-hand man Sam the bull is a free man even after murders. He never made the mistake of being arrogant.The another example isMichael franzese was one of the richest gangsters. He made $100 million a week by selling gas.This is what Saksham looked like because he ran his mouth a bit too much:Do not go and live in an isolated area as it may provide you some cover, but it’s also easy to spot you/arrest you.Here are some things you could do:Change your home city and home province or state.It's safer to live in the city because easy to blend in the crowd.Live in middle class (clean folks) area.Don't show off your money.Spend money via third party's credit card, cash, or use prepaid visa cards.Use prepaid phone. Don't make or receive phone calls. Let it go to voicemail and respond from public phone booth if you have to.Don't hire prostitutes or escorts from the city.Don't go to troubled clubs but go to the clean bars and have fun. Take only about $100 with you in cash.Avoid clubs on weekends as you have to scan your I.D.Don't be the part of the crowd that is causing trouble. Stay away.Speak at a minimum. Control your mouth (remember Gotti).Your past is your kryptonite, so don’t tell anyone about it for a while. You must let the statutory limitations to be in your favor before you open your goddamn mouth.Pretend to go to work everyday so your neighbors don't notice that you don't go to work and live a comfortable life.Become regular at the bar, obviously you are going to have to chat with people who work there. Let them know that you work for the “government” and can't really give the details. However, you can say, “I follow money from illegitimate sources. It's why you always see me by myself as I can't risk my job by telling anyone anything under the influence of alcohol, you know?”Buy daily items from the corner store. Make good relations with them. Use them as your spies. (Law enforcement agencies usually go in neighbourhood. They need refreshments as well or they will be spotted by members of the public who visit the establishment and “discuss” the moment in the neighbourhood. You should have “barber, coffee shop and corner store” as your friends. Every other day ask, “Is there anything new in the neighbourhood?”Basically if you want to avoid being spotted by security agencies, you must learn to respect your enemy. If you don't, you are never going to win.