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This business coaching lesson explains the practical steps for achieving financial freedom.

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Featured Coaching Excerpt - Notes & Transcript, Part 1
  • Lesson Nugget: If you don't read,plan, or have a to-do list, you will not be successful!
  • Lesson Nugget: It's not about how much you make, but how much you keep.
  • Lesson Nugget: Creating a schedule and sticking to it gives you control over your time.
  • Lesson Nugget: When you set up boundaries such as plans and budgets, you will feel more free and keep more of your money.

edtech for mindset, business education

[MUSIC PLAYING]

CLAY CLARK: And I think this is very big that you have a schedule. And again, I have yet to meet a successful entrepreneur who doesn't have some kind of schedule. Even with the venture capital guys I work with that have $100 million or $50 million-- and you go, well, you mean they carry a day planner?

This is what they say a lot-- Clay, I want to meet with you this week. Call my assistant. She'll schedule me. I just don't want to over-commit. I want to make sure I can be there. And then they're there like clockwork. But you've got to schedule. What you schedule will happen.

BRAXTON FEARS: It gives me the ability to make appointments within a time frame. It gives me control of my time as well. Also, whenever people say well, make time to read, or make time to work out, or make time. You think, well, what does that really mean? You have to actually write it down and put it in there.

And I like as much as possible make those things happen. If it's working out, it needs to be at the same time every day. For me, I don't wake up at a different time on Saturdays and Sundays. I wake up at the same time seven days a week, and it helps me to stay in that flow. And it gives me the ability not to just kind of do part of the time.

If I sleep in till 9:00 on Saturday and Sunday, I'm going to want to sleep until 9:00 on Monday. So I get up at 5:30 every single day of the week, and it works really well.

What do I do when I get up? What do you do? I have people why? Wow, why? What do you do? Well, I read, or I write, or I plan stuff. I do things that otherwise wouldn't happen at 8 o'clock at night.

CLAY CLARK: Video guys-- I know you can't necessarily-- we can't ask for an auditory response, I guess, because we don't have y'all miked. But everyone that we've interviewed so far, they all pretty much get up 5:30.

And what's funny is that there's nobody that we're interviewing that gets up at like 10:00. And I would say that as we build Thrive and it gets bigger and bigger, I bet you that we'll find maybe one out of 50 that don't get up early.

And it's why they all get together and have a conspiracy and say, we're going to get up at 5:30. No. It's because you have to read, you have to make a plan, you have to have a to-do list. And if you don't, you just can't be successful.

I know it sounds horrible, but you just cannot be successful. Hope all you are hearing me. You cannot be successful if you do not have a plan, a to-do list, goals. It's not going to happen. You've got to have that.

So now we're talking about point number eight here. It's not about how much you make, it's about how much you keep. Now, in life, the true goal for wealth building isn't how much money somebody can make, but how much money he or she can keep.

You hear about Antoine Walker? Antoine, I hope you're doing great, but the last time that we read about you, you had spent like $60 million, and you spent it all. And now you're bankrupt after an NBA career where you made $60 million.

Allen Iverson. If you're watching, Allen, we want to help you. But Allen made $100- something million, and he spent it all. And you go, that's Allen Iverson. That's so stupid. I could never do it. Really?

Well, what I have found is that everybody-- regardless of the income level-- always spends it all. And this is a human nature thing. So there are countless examples of people winning the lottery and end up going completely broke. Braxton, in your mind, why do most people who win money or who gain wealth through folly, why do they lose it all?

BRAXTON FEARS: Because they don't understand or appreciate the principle and the value of boundaries. I think that boundaries and borders-- I mean, you build a fence around your property to keep things from just anything from coming in. And you build a fence around a garden so that deer don't eat your whatever, if that's what you do.

You've got to build some fences and some boundaries not just for others, but also for yourself. You have to set up boundaries for yourself. That's what a plan or a budget is.

A budget is kind of this word that people don't like-- oh, that sounds very restrictive. It actually gives you freedom. When you set up that boundary of a budget for specific areas of your spending and saving and giving life, you will actually feel more free and be able to keep more of your money.

CLAY CLARK: Well, I've noticed here with budgeting-- and something that's just amazing to me-- is I met a guy. He's a schoolteacher who actually has a net worth of north of a million dollars. A schoolteacher. He actually invested in Thrive. And I'm like, what?

You know, in high school, they teach you that thing-- well, if you set $2,000 a month, and you set it aside every month, then eventually you'll have a million dollars. He actually did it. And so he's like 55, and he's got over a million bucks. And I think it's unbelievable how well off you can become without even ever having a big

income.

Learn more business education from mentors like Clay Clark

Featured Coaching Excerpt - Notes & Transcript, Part 2
  • Zero-Based Budget: A zero-based budget is a method of budgeting in which all expenses must be justified for each new period. Zero-based budgeting starts from a "zero base" and every function within an organization is analyzed for its needs and costs.
  • Lesson Nugget: If you don't follow the system, the system becomes ineffective and useless.

-Braxton, you also see with large amounts of money who are losing it all. How have you become, kind of, a budgeting wizard. And what is your overall philosophy towards doing this? How are you-- we got the school teacher who makes a million-- we have a school teacher who becomes a millionaire. You got a millionaire athlete who becomes homeless. It's budgeting, is the difference. What is your philosophy towards budgeting?

BRAXTON FEARS: I mean, we talked a little bit about a giving plan and a savings plan, how you work that out. But if you spend it all, there's no way to-- it's really hard to do that kind of thing. So, I mean, there's some very specific things that I do. I use Dave Ramsey's gazelle budget.

-Gazelle budget.

-The gazelle budget. You can just Google Dave Ramsey gazelle budget. It's called a zero-based budget. And what I used to think, which I believe was wrong thinking, is that you set up a budget at the beginning of the year and you follow it all year long. A lot of businesses do that, but you've got to set up a budget monthly. If you don't have a monthly budget that you refine, like we've talked about in other sessions, where you define what you're going to spend. And then you're going to act on spending. That's very, very easy. But then you've got to refine that budget every single month.

So for me, I mean, I have a number of accounts in my bank. This is a very simple thing. I have two business accounts, and then I have a holding account. And then I pay myself, and I pay my wife.

CLAY CLARK: I'm going to, real quick, I want to kind of get the-- let me see if I can get this. It takes a college degree, apparently, to operate this. OK. So you have different accounts.

BRAXTON FEARS: Yeah.

-So go ahead and fire off the names.

BRAXTON FEARS: So I have two business accounts.

-So you have two. I'll put business-- that was the most crazy way to make a B--

BRAXTON FEARS: Yeah, that's awesome.

---Business 1 and you have Business 2.

BRAXTON FEARS: Yeah

CLAY CLARK: These are your accounts.

BRAXTON FEARS: So people pay me into the business. That's where-- I don't spend any money, any personal money, out of those accounts.

-So these are just, OK, Business 1, Business 2. What else do you have?

BRAXTON FEARS: All right, so then I have a holding account.

-OK, holding account.

BRAXTON FEARS: Yeah. So this holds money that I am paying myself out of the businesses. And then I have a personal checking for myself. And I have a personal checking for my wife. And they're both joint accounts. They're not-- she doesn't have her own account. I don't have my own account. But she has a card and a checkbook for hers, and I have a card and a checkbook for mine.

CLAY CLARK: How do you spell Haley?

BRAXTON FEARS: H-A-L-E-Y.

-Man, writing is not my strong suit. OK, Haley, and we have Braxton. Just try to give it some real here. So this is one for you.

BRAXTON FEARS: Yeah.

-This is one for her.

BRAXTON FEARS: Yeah.

-This is a holding account. This is where you pay your salary out of?

-That's is where, yeah, I pay myself out of those-- into that account. And then the money that we have budgeted to spend, each of us, we distribute from that account.

CLAY CLARK: Now this is going to represent a tomato sauce can, Braxton. Valspar tomato sauce. OK, so here's the deal. So you get to the end of the month, and you're going to go shopping. And the tomato sauce that you want to buy, and the organic milk, and some sort of item, I don't know. All these items in your grocery basket are now $22 of expenses. But you only have a total of $21 in the bank account. What you do with this?

-You put it back on the shelf.

CLAY CLARK: You say, I'm not going to buy you, you Valspar-branded tomato sauce, because I am out of money for the month.

BRAXTON FEARS: Because if you begin to not follow the system in those ways, the system will become completely ineffective.

CLAY CLARK: So you're like, hey man, so you go put this back. You say, I'm sorry, we're not going to buy this.

BRAXTON FEARS: There's some food at home that we can eat. And when we get to the budget amount and the plan for the next month, we can get like a million jars of tomato sauce.

CLAY CLARK: Have you ever got to the end of the month and you begin just looking for creative things in your cupboard to eat. Even in the last couple years where you're like, I guess we can't eat beans with crackers, because we're out of money in the account.

BRAXTON FEARS: Sure. And we've been able to increase grocery budget over the years, so we don't get into that. But if we needed to decrease the grocery budget, I feel confident that we could pull it off.

-I'm going to say this real quick. Let's pretend-- now, I just want to make this real for the folks at home-- let's pretend-- and I'm not saying you do. I'm not getting personal. I'm just giving an example. Let's say you had $50,000 over here in the business account. But you still needed $22 to buy food, and you only have 21. You're saying, even though you know there's 50 over, here you're just not going to pull from the other 50 to do it. You're just simply going to put the soup back.

BRAXTON FEARS: That's correct.

CLAY CLARK: That's the kind of discipline you're putting in.

-Well, it's a boundary that you set for yourself. And if you break that boundary once, then it gets easier break it again and again and again. So we have two meetings that are not intense, my wife and I, per month. She's on the same page with me. And it takes time, because money-- especially in a family, or even in a team, like in your business with your team-- you sit down and you have fun, reasonable, not really intense conversations. Everybody knows what's going on. People that need to know in your business end and especially in your family with your spouse. Then you kind of know, OK, we're all on the same team. Here's what we're going for, and here's what we're working for. So putting that jar of tomato sauce back on the shelf isn't like a terrible thing. It's an OK thing to do.

And that's how you're keeping your expenses low, is just by budgeting and being diligent about sticking with it.

-You've got to be reasonable. I mean, you can't give-- we have a family, I have four kids. I can't give myself a $500 grocer budget. I have to be reasonable about it.

Featured Coaching Excerpt - Notes & Transcript, Part 3
  • "If you will live like no one else, later you can live like no one else." - Dave Ramsey
  • Lesson Reminder: The point of budgeting, and strictly sticking to that budget, is so you can hit your long term goals. Often, short term pain can equal long term gain.
  • Ask Yourself: Do you want to be comfortable short term or comfortable long term?
  • Lesson Nugget: Following the system may include having to get through uncomfortable situations. If it was always easy, everyone would do it.

[MUSIC PLAYING]

-Do you have cable?

-No.

-OK, I want to make sure that we're hearing this. I know a lot of people who are successful. They have chosen at one point in their career they say, I don't have enough time in my schedule to watch cable and watch the stuff I need to learn. I don't have enough money in my schedule, or not enough money in my budget to buy this and by that. And they make these choices. They choose to make a wise decision to get the result they want.

I've noticed that unsuccessful people never sacrifice ever, and then, ultimately, they sacrifice in the end. Where successful people choose-- to quote Dave Ramsey-- "they choose to live like nobody else today, so they can live like nobody else in the future," in a positive way. And I think that's where it really gets down to is--

-Let me share one more boundary that I set for myself, and my wife and I've decided to do this. We went to the bank with both of our cards. Because we cut the credit cards-- we've used those before. We used the bank cards, because we can see it. It's real money. We know that when we spend that money, it comes directly out of our bank account. That's a boundary we set.

But not just that, we went to the bank together and we said here's what we want to do-- these cards, if we spend more than what's on them, we want to be declined at the cash register. The bank person said you realize that you won't be able to-- we'll cover your overdraft. If you overdraft, you have enough in your other accounts, we'll cover it. We said no, we'd like to be declined at the place there.

They even said, you know that's going to be kind of embarrassing? Yes, we understand that. It's a boundary we want to set for ourselves-- to be declined with our debit card. We do not want to allow ourselves to spend that $21.00 when we actually only have $7.00 in the account.

-Now, you meet with your wife twice a month about this stuff?

-Uh-huh.

-Do you have a set time?

-We have Thursday at 7 o'clock. The kids go to bed, and we sit down. We have a little tea, sit down, and we talk for 30 minutes about our finances. We pull out the gazelle budget, print it off.

I also do this with our schedule-- that schedule I showed you earlier. We say, do we need to tweak the schedule? Do I need to change the way it is? I print off a new schedule probably every two or three weeks.

-Now, I want to throw this out here, because I think this is so important. If you were to meet Braxton's incredible wife-- probably one of the most sweet, caring I would say almost-- she would appeared to be light hearted, and very gregarious, lot of energy, and that kind of thing. And so you don't have to be-- it's not like you're married to the most intense accounting minded budget focused person. But you guys, as a team, have come together and said, we're going to do this.

-Yeah.

-You're a team.

-In fact she's the opposite of that. She's more-- I'm the analytical-- she's more like you. You know, opposites are good at that. But she wants to be in control of her time. And she wants to be in control of her finances. She's bought into that and I think that-- well, I know-- that makes it much more enjoyable.

[MUSIC PLAYING]

-In terms of driving down costs, I've noticed that you are very relentless about doing that. And I guess some of the best examples that I could give would be there's a lot of people that, they buy everything at a retail store. They buy their coats, their jackets, their socks, their shoes. It's gotta be from the mall. It's gotta be full price. It's gotta be-- and yet you always look for a good deal.

And I don't know if I've ever heard you say it, but it seems like in your mind you feel like you're making more money. It's like if you had $50,000 but you could buy $70,000 of stuff for that $50,000, you're going to find a way to do it. So you almost make money on the buying side too. What is your philosophy towards driving down costs and just being frugal?

-Well, I think when you set up the boundaries you just do that. And you could spend too much time trying to find a good. That can happen. If you're like, I've got a coupon. I'm going to go drive 50 miles to go use this coupon. Obviously, that's stupid.

But for a car-- in my family, we have four kids and a suburban makes sense for us. And so, rather than go out to the dealership, and buy a brand new suburban, and borrow money for it, or even, whatever, I know that my car is going to be trashed within the first three days of owning it. So I'm comfortable with that stage. But I'm not going to buy a brand new suburban. I have two suburbans, but I've bought them both used. And I bought them, I've looked on Craigslist. I've done all my due diligence. I've found good solid cars for under $10,000. And they're nice cars. They're not-- and you think, how can you buy a good suburban for under $10,000? You can find it. You just have to work a little bit harder, and you find those times. You schedule that time. That's one of those things that I might do at 5:30 or 6:00 in the morning while I'm drinking coffee.

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