The article you are about to read will deal with your financial conduct, the financial conduct of large companies, the economic crisis, and finally – the important lesson to be learned by combining all three elements together.
Here are some questions you should ask yourself and answer them sincerely:
1. When was the last time you looked at your credit card billing statement?
2. Do you know how much you pay for Internet / TV (cable and / or satellite) / insurance?
3. Do you know how much you pay per minute on your cell phone and how much costs the plan you're in?
4. Do you know more or less how much are your expenses and what is/are your income/s this month?
5. Do you have an overdraft on your bank account?
If most of your answers to these questions and other questions alike are "no" or "I have no idea" there is a problem…
On the Chapter dealing with "developing a personal philosophy", I wrote the following sentence: "..just because disaster didn't occur immediately - doesn't mean it won't occur at all" - That is if your answers to most of the questions above are "No", and your financial status is "ok", it does not mean it will remain so forever…
The Conduct Of A Large Company
Here are some questions worth asking about large companies:
1. Is a big company aware of all the rates it pays for different services?
(communication / leasing cars / outsourcing, etc.)
2. Is a big company working with a business plan that takes into account different variables?
(decline in revenues / expenses and special advertising / bonuses, etc.)
3. Is a big company taking into account risks?
4. Does a big company know the bottom line expenses versus revenues?
The answers to most if not all of the questions are "Yes!" (Especially to the last question, as the law requires the company to submit financial reports to the state).
The companies whom the answers to most questions are "No," you can read about them in newspapers under the headline "economic crisis" or "bankruptcy"…
The Global Crisis
The recent economic crisis happened (at least in part) as a result of taking uncalculated risks, and reckless conduct that lasted until… well until it turned into a crisis… But as I wrote already: "..just because disaster didn't occur immediately - doesn't mean it won't occur at all", and it did!Large (and supposedly
Large (and supposedly established) companies fell and collapsed.
The current crisis also damaged other industries because one business feeds the other; The crisis spread worldwide since we have become one small global village, but it is important to emphasize, not all of them! - the word "crisis" sounds scary, but the crisis has "attacked" those who took uncalculated risks, those who were reckless and those who did not prepare themselves…
Yes, tycoons such as Warren Buffett also suffered from the economic crisis, but not as some of the largest companies did, and certainly he's not even close to bankruptcy, the opposite.
The crisis has created a rare opportunity to buy "goods" (other businesses) at a low price - this opportunity was preserved only to those how were accountable, those how managed their risks along with a proper financial conduct.
Coca-Cola will suffer from the global recession, but you can be assured that this company will survive...
This is my recommendation – act as if you are the chairman of a large company!
The company you manage: you, your family, your household.
* Check what you pay for and check if you are paying too much for that service.
* Monitor your expenses and your incomes. More importantly – make sure you make the necessary adjustments if your expenses are bigger than your income, that's what every big company does.
* Take risks, but make sure they are calculated in the framework that you can afford, be aware of your limits.
A note to summarize this issue:
The expression "Be accountable" is not equal to "Cheapskate".
Large companies don't act like that, and I do not recommend you to turn into a cheapskate.
If you love to give, I think it's wonderful! What I am saying is this: give as much as can afford and not above it, so you would be able to continue giving in the future.
I kept this issue to the end because it actually concludes the article, and it's also the result of been accountable and having a proper financial conduct.
Companies who are accountable and have a proper financial conduct, earn over time and become stronger.
That's exactly what can happen with you. Words like profit, stability and development will become familiar to you, if you'll act as a chairman of a successful large company, and just like a big company – there is no doubt bonuses will start knocking on your door…
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