David Bach on How to Build a Career Without Going Broke

I recently caught up with David Bach, who has written multiple New York Times bestselling books such as The Automatic Millionaire and Start Late Finish Rich. His latest book is called Debt Free for Life: The Finish Rich Plan for Financial Freedom. In total, he has more than seven million books in print, translated in over 19 languages. Bach has appeared several times on The Oprah Winfrey Show and is a reoccurring guest on The Today Show. He is the founder of FinishRich.com, a website dedicated to revolutionizing the way people learn about money. In this interview, he talks about how your career can impact your financial life, offers some career tips for succeeding in business, and more.

Does your career choice impact your long-term potential of becoming wealthy? Why or why not?

The obvious answer to this is “yes”, the real world answer however, is “no”. I will give you an example. When I was a financial advisor and a Senior Vice President of Morgan Stanley, I had a realization that I loved to teach people about money as much as I enjoyed managing people’s money. The challenge was, “teachers” don’t make a lot of money historically. My friends thought I was crazy to go spend time writing a book and teaching when I could simply manage money and make so much more. Today however, I teach millions to be smarter with their money, and I have earned millions as a result.

I took my passion and purpose of teaching people to take action financially and turned it into a multi-millionaire dollar business. In ten years, FinishRich Media, LLC has produced 9 consecutive New York Times bestsellers with over seven million copies in print and taught and trained millions of people our principles around the world. My work has been translated into 19 languages and can be found in over 50 countries. We have had some of the largest companies in the world partner with us to license our financial education content. All of this started from me teaching an adult education class at a local high school for free.

Is it wise to choose a career based on earning potential or is it better to do something you love regardless of your paycheck? Why?

I think personally, it’s important (actually critical) to find something to do that you deeply love. You have to be able to jump out of bed and be excited every morning when you start a business or a job, if you are going to be successful. The truth about business is that it’s normally very tough. It’s very rare that you will start something and succeed right away and if you do succeed, you might not make a lot of money.

Most businesses take at least two to three years to show profits. The other thing is that most huge success stories that we read about and see have been ten years in the making. I’m a true example of a “ten year overnight success story”. In 2004, my fifth book The Automatic Millionaire was the #1 book that year. It spent 31 weeks on the New York Times bestseller list and reached #1 on the New York Times, Wall Street Journal, USA Today and Business Week bestseller lists. Most people thought that was my FIRST book when in reality, it was my fifth.

The beauty of truly loving what you do is you can get through the tough times, because you feel in your soul it’s your mission and purpose in life. And people can also tell when you truly love what you do versus doing something for the money. I believe this is what has truly worked for me.

With this all being said, there is a second route to go—and I have seen it work very effectively. I have friends that have started businesses purely because they have a specific mission and purpose to make a certain amount of money. I have a friend that built a business, in a space he didn’t care deeply about, but he knew if he built the business he could sell it for a seven to ten times multiple of EBITA. He even had a great idea of who would buy it. He built the business over a seven year period and reached his goal (which was to sell the company for over $20 million dollars). My friend today is now focused on his real passion which is a charity built around helping moms and children that are victims of domestic violence. His business goals lead him to now have the time and resources to fulfill his true passion and purpose.

What three career tips can you offer based on your experience?

My first advice is “decide what you want”.

You have to see what you want your future to look like. You have to deeply imagine, put on paper and create a plan to go for your dreams. No one is going to show up and help you make your dreams real until you are clear on what your dreams are and you are moving relentlessly towards them. When I decided to write my first book Smart Women Finish Rich, I had a mission to educate one million women about money so that they could teach their families and kids how to be smarter with their finances. I felt this was my purpose in life, and I didn’t listen to the naysayers telling me, “you can’t do this, you’re a guy, women won’t buy a book for women about money, there’s no money in what you want to do…” and on and on. I had total clarity about what I intended to do and worked on an action plan to make it happen. I started this dream in 1994. Ten years later when I was sitting next to Oprah on her little yellow couches teaching ten million people how to become an Automatic Millionaire™, find their Latte Factor® and “Pay Themselves First”—the only one that wasn’t surprised I was there was ME. I had been working toward that for ten years; I knew the day would come. I saw it, I decided, and worked the plan until it became a reality. Okay, maybe I was a little surprised…

My second advice, is manage your cash flow well.

The number one reason most business don’t work, and most people don’t reach their dreams in their careers is financial. When you are living paycheck to paycheck it’s harder to go for your dreams. Having emergency money set aside creates more courage—it’s simply a fact. Whether it’s a career decision or a business decision when you have money you have more courage to take risk and invest in your future. I strongly suggest that the moment you start a business, you treat it like a business. You need to set up a corporate structure, hire a book keeper, separate the business money from your personal expenses (corporate bank account, business credit card etc.) You should be on top of the financials from day one. You can’t afford to screw up the finances or your business simply won’t make it. Cash flow is the life of a business and you need to watch it daily. You also need a true financial plan as an entrepreneur because you won’t realistically have a pension or health care plan when you retire—so you need to set up your own retirement account day one, and you need to invest in real estate for your business and you ideally need to build your business for “exit—a sale”. Most businesses are dependent on the entrepreneur, and if that is you then you really need to get the first two issues handled (saving money and investing in assets that make you money).

The third advice I have is you need a really GREAT team around you.

The most important member on your team is your attorney. Every single deal I do is vetted by my legal team. Bad deals can destroy your business and take away your future. It costs a lot to protect yourself, but the reality is you need to. You also need a great accountant, a financial advisor, and a book keeper. Then depending on your business you may need a PR person and/or marketing team. In my business I also have a team of agents. But regardless, of who’s on your team the bottom line is you need a ‘GREAT’ team not a good team. The quality of your life and business will be massively impacted by who you put on your team, and that of course includes who you hire. You have to hire people that “get it”, and are equally committed to you and your vision. If you do the above you will be on the right track.

Last but not least, what is most important is this. Don’t give up! Don’t give up! Just get UP!

If you agree that the richest people are the entrepreneurs, then what is the best way to go from a job seeker, or employee, to an entrepreneur (without going broke)?

Well this one is easy. Don’t just quit your day job and make sure you have money set aside for the leap you want to take.

In my case, first and foremost what I did was I worked really, really, hard at Morgan Stanley to build a “DREAM BASKET” of money that I set aside from each paycheck—to use someday to walk away. I teach people how to build a dream basket in my books, Smart Women Finish Rich, and Smart Couples Finish Rich. I had a very specific financial goal that when I reached X dollars I would force myself to leave the business and just teach people full time how to be smarter with their money. The second thing I did was I started my new company while I was still at Morgan Stanley. I worked on my business from 5am to 7am, and then went to work. Then I worked on it again from 7pm to about 11pm, every day and on weekends. I didn’t quit my day job when my business started taking off.

In fact, my agent told me over and over again, “David don’t quit your day job.” I had three bestselling books out before I quit my day job. I had a million dollar a year business at that point on the side and I had savings (and still it was scary). I had a hugely successful career at Morgan Stanley as a Partner of the Bach Group managing money—my life was basically set financially if I stayed there. My dream however, required me to make the leap—and I went for it full time in 2001. But the moral here is that I worked toward that dream for a solid five years before I made the leap. It wasn’t on a whim and a prayer. I had proof that my business would work. And most importantly I had proof that what I was teaching was getting results, people loved my programs and I loved providing them—what could be better?

You’re a highly visible figure in your industry. What recommendations do you have for people who want to become more visible in and out of the workplace?

I think the first question is: why do you want to be visible? And then what do you want to be visible for? Today, you can put up a YouTube video of how to “trick people into thinking you’re good looking”…and over 33 million people watch it. (That video by the way is pretty hilarious and now another ten million will go watch it because I just said this.) But the point of this is you need to know why you want to be visible.

I think the way you build a “brand” and become highly visible is that you have a plan to do just that. I worked on a specific well thought out plan to be one of the leading financial experts in North America. To get there I did everything. I have traveled hundreds of thousands of miles across this country, and spoke on almost every radio station, television station, and public television show you can think of. I have literally done thousands of interviews. This week I did my 100ths segment on NBC’s Today Show. After the Today Show I did an online chat with 17,000 people, and now I am doing this interview. And I could do six more today if I had the time. I got to where I am because I focused on being exactly where I am. The only real thing I haven’t accomplished yet in the media world is having my own television show—which I still want and I’m working towards.

But aside from the plan and execution here is what makes someone stand out.

1. You have to have a story. Your story…who are you, and why should I care that you care? My story begins with my grandmother Rose Bach and how she taught me to invest starting at the age of seven—when she helped me buy my first stock in McDonalds. Her story of being a self-made millionaire who started with nothing at age 30 and became rich, is amazing—and how she taught my whole family to invest, is very much a part of why I do what I do. I want to teach others, like my grandmother taught me. You need to tell your story and love your story. People know my story because I love it so much, and I never get tired of sharing it.
2. Your story has to help people. My story is about ultimately helping people to take “action” when it comes to their money. I make being smarter with your money seem doable. I take you by the hand and point you in the exact direction you need to go to get results. And I make it easy, so that people who follow me do take action and get results. And they in turn become raving fans and spread the message, and share it forward. Not a day goes by that we don’t get heartfelt letters from readers about their successes. When you help enough people get what they want—as Zig Ziglar said, you my friend will get what you want.
3. Your story has to be authentic. The “B.S.” meter today is higher than it has ever been. If you are not giving people the real deal, and you are not authentic, people will know. Businesses and brands today have to have trust as a core metrics of their business, because trust is where the ability to scale comes in. The media for instance is not going to have you on their air, if they don’t think what you have is trust worthy. You wouldn’t be interviewing me if you didn’t think “this guy is trust worthy, and a leader in the space”—and so much of that comes as a result of showing up with the goods for years, and years, and now decades. Most experts by the way come and go, as do celebrities, because staying out in the spot light long term takes massive, massive energy and purpose. Getting to the top is not as hard as staying there.
4. Be nice, show up on time, do what you say you will do, and then say thank you! You could teach an MBA course just on this. But at the crux of it all is that if your goal is to ultimately stand out, and be highly visible you do it by doing great work, consistently, over time. And as you do you great work, you then do a really great job of being nice to everyone you work with and then you are always grateful. People do repeat work with people they like. It doesn’t matter how good you are, if you are rude and difficult to work with—as soon as you are not “hot” you are done. And more importantly, people will block you from your success if they don’t like you. If they like you they will root for you and pull you up to the top.

Dan Schawbel, recognized as a “personal branding guru” by The New York Times, is the Managing Partner of Millennial Branding, a full-service personal branding agency. Dan is the author of Me 2.0: 4 Steps to Building Your Future, the founder of the Personal Branding Blog, and publisher of Personal Branding Magazine.

This article original Appeared on Forbes:
http://www.forbes.com/sites/danschawbel/2012/01/16/david-bach-on-how-to-build-a-career-without-going-broke/#7dcd189a1db7