Transformation of risk

Transformation of risk Risk is an axe. Proficient control can lead to wealth. The motto of Zhiben Instructor: To get rich, there is risk. Without risk, you cannot get rich. The key is to look at...

Risk is an ax that can be mastered and mastered to make you rich

>Zhiben Tutor's motto If you want to get rich, you have risks. Without risks, you cannot get rich. The key depends on whether you can control the risk. Well-known entrepreneurs must learn to think with numbers and turn numbers into your eyes. Understanding numbers and understanding a company's financial system is like looking at a person's body with X-rays. You can see any problem. A debt that someone pays for you is a good debt, a debt that you pay yourself is a bad debt. To become a rich person, you must learn the thinking mode of the rich and learn the methods of making money, so that there is no risk in becoming rich.

Risk is the starting point. If you want to get rich, there are risks. Without risks, you cannot get rich. There is no risk in saving, but you cannot make big money by saving. Because interest on savings is very low, and the tax bureau also taxes the interest. The profits from investment are huge, but the risks are also very high. The key depends on whether you can control the risk. When you have a correct understanding of risk, you can control it; when you don't recognize it, you can't make money. The child of a colleague has a project to produce optical discs, which is very profitable. He hopes that the author will invest 300,000 yuan, with an annual interest rate of 50%, and an interest payment of 150,000 yuan at the end of the year. After various investigations, the author has determined that the risks are there, but they can be controlled. The decision was made immediately and the investment was 300,000 yuan. After a year of operation, the risks were overcome and successfully completed, and all the principal and profit will be recovered by then. The next year, he persuaded me to continue investing and asked for 400,000 yuan. This time the author was careless and did not carefully analyze the risks. There was an unexpected situation in the market, and the price of raw materials for optical discs suddenly increased, resulting in a significant drop in product profits. His profits fell, and the author's investment interest was not guaranteed. The principal and interest were in trouble, and he was not able to repay it for several years. It can be seen that investment is risky. If you can control risks, investment will bring considerable benefits; if you cannot control risks, it will bring losses. Risk is like a mountain ax. If you master it well, you can dig out gold mines. If you don't master it well, not only will you not be able to dig out gold mines, but you will also lose all your capital and profits. Thinking with numbers

An entrepreneur must learn to think with numbers and turn numbers into your eyes. Understanding numbers and understanding a company's financial system is like looking at a person's body with X-rays. You can see any problem. Having financial vision reduces your risk and conversely increases your risk. One of the "magic weapons" for an entrepreneur's investment operations is to strictly control the ratio of investment and consumption. This ratio should be 8:2. In other words, when you make money, you should use 80% of the money to reinvest and 20% of the money for consumption. The reason why "8:2" is a magic weapon is because if you strictly control it, you will make a fortune; if you cannot control it, you will fail. Most successful entrepreneurs strictly control this ratio. They always keep an eye on the monthly financial statements and constantly control and adjust the ratio of investment and consumption. There is a professional manager in our circle who is engaged in management and has countless things on his mind. The money handed over by the user is put into the account; when the money is used, it is taken out of the account. No matter how much money you earn, you don’t even count how much money you spend. When there is a project to invest in, there is no money in the account. When asked where the money went, he said he didn't know. It is difficult to make money with countless operations in your mind. In fact, thinking with numbers is not difficult. You can do it as long as you improve your way of thinking. The difficulty lies in the unwillingness to change old habits and old ways of thinking.

If you're going to build a big business, you have to have a handle on the financial numbers. Numbers tell you the real story. This is why many large companies often have a financial director controlling their operations. There was a professional manager in our company who made a payment error during the execution of a contract, which put the company in a very passive position. The signed sales contract stipulates that payment should be made within one week after delivery. The same method is also stipulated in the purchase contract that payment should be made within one week after delivery. One week after delivery, the user should have paid. However, the user's purchasing staff and its financial director had a conflict. The purchasing manager should pay from the perspective of executing the contract; the financial director should not pay from the perspective of his company's accounts. Before that, our professional manager had already paid a deferred check to the supplier. I want users to pay on time and have deferred checks take effect when they expire, getting the best of both worlds. Unexpectedly, the user did not pay, but the supplier took the money out of our account. Because this transaction involved a relatively large amount of money, almost all the money in the company's account was wiped out, causing great disruption to the company's financial operations. Although the problem this time lies with the other party, that is, the company's management was very chaotic during the contract signing process, and the financial director did not control the operation of the purchasing manager well, which caused such a contradiction. But we have learned a lesson since then. The author told the financial staff that from now on, no checks, including deferred checks, can be issued until the user's money is received.

Risks of "Taking Big Steps" For people who have long-term financial success, their investment principles are not measured by taking big steps, but by the number of steps and years. Some people always want to take a "great step" in their business plans and always want to get rich overnight. Whenever you fail to achieve your goals, you become discouraged and seek to change direction. The author has a niece who majored in calculators. After investigation, she found that the profits from the calculator business were too thin, so she changed her professional direction. She heard that clothing business could make a lot of money, so she switched to clothing business. After two or three years of hard work, I didn’t make much money despite the wind and rain. I heard that people were buying new houses, furniture, and sofas, and that selling sofas could make money, so I switched to the sofa business. After several years of hard work and not making much money, I wanted to change my career again. I heard that the author was making a lot of money in Beijing, so I came to Beijing to find the author. She said: "I want to make a lot of money, but why can't I make a lot of money?" The author said: "You learn calculators and are in the clothing and sofa business. Your advantage has dropped to the level of a middle school student. How can you make a lot of money!" She said: "I want to come to Beijing, can I make big money?" The author said: "There are many people in Beijing who can make big money, and there are also those who can't. Whether you can make money depends on whether you have advantages in this area. If you have advantages, you can make big money, but if you don't have advantages, you can't make big money. You are a calculator student. Beijing is a place where the information industry is concentrated. You should be able to make a lot of money in the calculator business." After hearing what the author said, she came to Beijing. First, they visited the Hailong calculator supporting market, and then conducted an investigation at the Zhongfa Electronic Components Market. Seeing the market in full swing and flourishing with flowers, I was a bit dazzled, so I came to see the author again. She said: "I am eager to make money. Firstly, I have no capital, and secondly, I have no experience. I don't know how to make big money quickly." The author said: "In order to make money quickly, you should go work for others first! I will introduce you to a boss who is my friend and is in the electronic components business in Zhongfa. You go to work for him. On the one hand, you can make some money, and on the other hand, you must learn from the boss's experience in making big money. This way you will know how to make big money!" She accepted the author's suggestion and went to work for my boss friend. I have been working for a year and my monthly salary is only more than 1,000 yuan. She didn't want to work because she didn't make enough money, so she came to see the author again. She said: "I have been working for a year and only made a little money. When can I make a lot of money?" The author asked her: "Have you learned the boss's experience in making money?" She said: "Yes, his experience is to attract customers at the counter! I worked for him, and he asked me to do tests and deliver goods, but refused to let me go to the counter. When will I learn how to sell? I want to go to the counter, I want to do it myself, and I want to make a lot of money!" The author said: "You have to go to the counter. Do you know how much it costs to rent a counter?" She said, "A counter on the first floor of Zhongfa Market is 120,000 yuan per year, and I can rent half a counter for 60,000 yuan per year." The author said, "Are you sure you have 60,000 yuan?" Earn 60,000 yuan a year?" She hesitated and said, "I'm not sure yet!" The author said, "When you earn 60,000 yuan, it means you have done it for nothing! If you earn 50,000 yuan, you will lose 10,000 yuan." At this time, she hesitated. The author continued: "I also have a friend who works at the counter on the first floor of Zhongfa. He is also in the electronic components business and is also the boss who has made a lot of money. I told him that you can occupy a space with him for free and try selling for some time. On the one hand, you can sell your goods, on the other hand, you can help him, and more importantly, you can learn from his experience in making money." She followed the author's advice and went to the counter to sell her goods. A year later, she came to the author again and said: "It's been a year and I haven't made much money. I don't want to do it anymore. I want to work part-time!" The author said to her: "You can't get rich overnight. People who make a fortune have the following three characteristics. First, they have long-term plans. The two bosses you worked for are people who think long-term and can formulate practical long-term plans. After five or six years, some even after 6 to 10 years of planning, they worked hard and finally achieved success. Second, they believe in delayed returns and are willing to They make short-term sacrifices and make long-term preparations to achieve success. Third, they make use of the power of compound interest. They invest 80% of the money and only use 20% for consumption. They believe that the capital will be compounded after years of accumulation. It is impossible to make a fortune before you get to this point. The author said: "Look at those who really made a lot of money, they didn't get rich overnight. They all have long-term plans, not by taking big steps, but by steps, direction and years of accumulation. You just want to make a lot of money, and it's impossible without a long-term plan. Generally speaking, successful young entrepreneurs have to work for 3 to 5 years, and those who engage in high-tech need to work for 5 to 8 years before they can gain the experience they need to run their own company and make big money." I gave her a poem for this purpose:

Success cannot be achieved by thinking about getting rich. Long-term planning must be measured. You cannot make big strides by accumulating work experience.

Bad debt and good debt. There are good debts and bad debts. What is good debt? Debt that is paid for by someone else is good debt. What is bad debt? Debt that you pay yourself is bad debt. The daughter of a classmate is a professional manager. She made some money through her own business and wanted to buy a house. She came to consult with the author. "Uncle Lian! I want to buy a house, but I don't have enough money. What do you think I should do?" The author suggested that she could get a loan. "What should I do if the debt is too heavy and I can't pay it back?" she asked. The author said: "Debts can be divided into good debts and bad debts. If you buy good debts, don't be afraid. Don't buy bad debts. Bad debts are risky." She didn't understand and asked: "What is good debt? What is bad debt?" The author said: "Debts paid by others for you are good debts, and debts paid by yourself are bad debts." She was even more confused and asked: "How can someone else pay for your debt?" The author said: "For example, if you buy an office, don't use it yourself, rent it to others, and others pay the loan for you, this kind of debt is a good debt. If you buy an apartment to live in yourself and pay the loan yourself, this kind of loan is a bad debt." She hurriedly said: "My husband advocates buying an office, and I advocate buying an apartment. I am hesitating whether to buy an office or an apartment. According to you, is buying an office a good debt?" The author said: "Yes, if you buy an office for your own use, the loan can be used to finance the company's operating costs. This kind of loan can be paid for by business expenses, which is a good debt. If you buy an office and rent it out if you do not use it, the loan will be repaid by the lessor. This is also a good debt." She said: "Then buying an apartment is a bad debt?" The author said: "Not entirely. For example, if you rent out a house bought with a bank loan, it is a good debt. If you live in it yourself, it is a bad debt." She said: "According to what you said and based on my actual financial situation, I took out a loan to buy two offices, one for self-use and one for rent. I don't have to buy an apartment for the time being. Isn't that good?" The author said: "Very good, so that all your debts are good debts." She said: "The original house is still livable, but I just want to improve it. So don't buy it now, and buy it later based on the business situation!" The author said: "This is a good decision. When your business efficiency improves, you can use 20% of the profits to buy an apartment. By then, your profits will be bigger and bigger, and your capital will be higher and higher. Of course, our purpose of making money is to improve our lives, but when is the most appropriate time to improve? It should be said that your loan becomes When the debt is good, it can be improved under the condition of ensuring improved efficiency. When the business efficiency is getting higher and higher, the improvement of living standards will be correspondingly higher. When your loan becomes a bad debt, you will become an employee of the bank. If you borrow a loan for 20 years, you will have to pay off the debt with your own hard-earned money. " For this reason, I gave her a poem:

It is good for others to pay the debt, but it is bad to pay the debt yourself. If you consume too much, you cannot buy an office or rent it out, but you can get a loan.

The risk of "showing off" If you want to become rich, you must learn the thinking mode of the rich and learn the methods of making money, so that there is no risk in becoming rich. However, some people do not have the thinking of the rich nor the ability to make money. They just envy what the rich have, which will cause great risks. There is a professional manager in the circle who has great ability to create markets, but lacks strength. He saw that wealthy people renting large offices had a good image. Although he did not have many employees, he also rented a large office. He saw wealthy people buying expensive cars, and even though he had no money, he borrowed money to buy one. Seeing rich people hiring experts at high prices, even though they don't have any high-tech projects, they still hire senior engineers to work for them. Seeing that the rich have many employees and are vigorous, even though they do not have much business, they still employ many employees. He does not learn how the rich think, but compares with what the rich have. Every year when the accounts were settled at the end of the year, the accountant told him that the income was not enough, so he tried to find ways to borrow money. The debt he owed last year had not been paid off, and he borrowed new debt that year. In fact, he made a lot of money every year, but he was heavily in debt. This result is caused by "making a big show" and is also the most dangerous. There is an old classmate, the old couple are both working-class people, and the son and daughter are also working-class people. His son saw others buying villas and bought one for his parents. Although my son paid for the house, the water, electricity and property management fees were too expensive, especially air conditioning in summer and heating in winter. It was not enough to cover the entire retirement salary of the couple without food or drink, so they had no choice but to move back to their original residence. Master Zhiben has a poem that says: Develop markets to make money and make money to improve life. Don’t look at the rich before you become rich. It can be seen from this that before you become rich, you must not blindly compare the property of the rich, otherwise you will definitely fall into a debt trap. Risk and Insurance In the era of planned economy, although there were insurance companies, there was no personal business, and everyone was unfamiliar with insurance. After the implementation of the market economy, selling insurance became a fashionable business. There are many types of insurance, such as occupational insurance, property insurance, life insurance, life insurance, medical insurance, children's insurance, etc. There are many details, which must be understood through training. In fact, it is a measure of social security. Occupational insurance does not guarantee employment, let alone make you rich. It can only provide you with some basic living expenses after you lose your job and some pensions after retirement; life insurance cannot guarantee your longevity; life insurance cannot guarantee your life safety; and medical insurance cannot guarantee that you will not get sick. A friend's daughter is studying finance. She heard people say that selling insurance can make a lot of money, so she also started selling insurance. It was very hard for her to go to the east and the west, and she had not made any money yet. Her father told her: "Your Uncle Lian is a rich man. He has money to buy insurance. You can find him!" She came to this author with great hope, hoping to make some money through my insurance purchase. She said: "Uncle Lian! I'm in the insurance business now, come and buy some insurance! Introduce me to some rich people who want to buy insurance from me!" The author said: "I don't buy insurance, and the rich don't buy insurance!" She asked me in surprise: "Why?" The author asked her: "What insurance do you want me to buy?" She said: " Buy occupational insurance!" The author said: "The insurance company only protects unemployment, not making money. We run a company to make money, and there is no unemployment." She said: "Although it cannot guarantee making money, I can get a pension when I reach retirement age. I have already left a pension for myself. If I pay myself a pension, why should I give the money to the insurance company and let it pay it to me?" She said, "Then buy a corporate insurance for the company!" The author said, "Every business project of the company has risks. We can't make money without risks. We are dealing with risks every day. It is our job to manage risks. Insurance companies are only effective if we fail to do our job. We require employees to do their jobs well and not to fail in their duties. Therefore, I do not buy corporate insurance. She said: "Then buy a medical insurance!" The author said: "Can medical insurance guarantee that I will not get sick?" She said: "I can reimburse you for the cost of medicine." The author said: "Now the country advocates health care, and health care is a good thing for the country and individuals. Practice at home and abroad has proven that spending 100 yuan on health care can save 10,000 yuan in medical expenses. I want to use the money on health care, and do not want to spend it on medical insurance premiums." After listening to the author's theory, she suddenly understood and said: "No wonder I found at work that the richer the people, the less willing they are to buy insurance, and the poorer the people, the more willing they are to buy insurance." The author said: "Salary-wage earners are your users, buy from them! Salary-wage earners pursue safety and they need insurance." She said: "Salary-wage earners are willing to buy it, but they don't buy it if they don't have the money." The author said: "The rich don't buy insurance if they have money, and the salary earners don't buy insurance if they don't have the money. This is how difficult it is to sell insurance." She said disappointedly: "I originally thought I could make a lot of money selling insurance, but it's too difficult and I can't make a lot of money at all. I don't even want to do it anymore." The author advised her: "Okay, stop doing it. You learn how to do business! I will help you learn how to do business. Once the business is done well, you can make a lot of money." For this reason, he gave her a poem:

Life insurance does not protect life, and medical insurance does not protect illness. The rich who have no money to buy insurance on salary do not need self-insurance.

After she went back to discuss with her father, she adopted the author's advice and came to my company to learn how to do business. She and her husband cooperated and achieved good results on the gas boiler project. She was very happy and said to the author: "My direction has changed in the right direction, and my wish is about to come true."

Zhiben Tutor's motto: Risk is the starting point. Insurance companies don't protect wealth. You can't make big steps when making money. Don't make a big show of getting rich.