The ability to execute an idea

Great inventors and industrialists became great, not so much because of their ideas, but because of their ability to execute. This is the crucial aspect.

It Really Does Take Money to Make Money

Now before discouragement sets in, I want to stress that it doesn’t necessarily have to be your money. As we all know, ideas have value. This value can be unleashed by using other people’s money (OPM). OPM, has launched many a fortune based on nothing more than a fine idea.

What these great men had in common was the ability to execute, which as we’ve already determined, requires money.

Ideas, however, are like sphincters—everybody has one (or more). Taking an idea from wishful thinking to a viable business enterprise requires (you guessed it) MONEY! In the not too distant past, finding the money to turn ideas into realties was an arduous task. Loans from friends and family, bootstrapping with your own assets and credit, angel investors and venture capitalists were the only available sources of capital.

The process of turning an idea into a commercially viable product or service is known in the entrepreneurial community as execution. Great inventors and industrialists became great, not so much because of their ideas, but because of their ability to execute. Samuel Morse wasn’t the first to invent the telegraph; Thomas Edison was not the first to conceive the light bulb and the venerable Alexander Graham Bell wasn’t the first to envision the telephone. What these great men had in common was the ability to execute, which as we’ve already determined, requires money.

History of these inventions

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If we delve into the history of these three inventions, we learn that an Italian, Antonio Meucci, was the first to develop a working telephone. He filed a temporary patent 5 years before Bell but poverty and poor health prevented him from paying the patent office the $10 fee required for the patent’s renewal.

Heinrich Goebel was likely the first to invent the light bulb. In fact, he tried selling Edison on the idea but Edison wouldn’t bite. Goebel died a couple of years later and Edison bought the patent from Goebel’s impoverished widow for a song.

A French inventor by the name of LeSage invented the telegraph 60 years before Samuel Morse. The idea didn’t take root in France but Morse brought it to fruition here in America.

These examples demonstrate the important roles money and execution play.

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Challenges millennials face today are different from the challenges my generation faced, chief among them, crushing student loan debt.

I hate millennials … well, not really. I ENVY them! I envy them because they have their entire lives ahead and I’m looking at mine in the rear view mirror. I hate them because, like all young people, they are ignorant—not stupid, but ignorant. They refuse to learn from the mistakes previous generations have made and many refuse to learn from the successes. But hate is the wrong word. How about profoundly disappointed?

I’m not a sociologist, psychologist or anthropologist. Therefore, I have no academic insights into the reasons young people so often refuse the advice of their elders. All I know is—they do! And like those that have come before me, I continue to offer my advice and counsel, secure in the knowledge that it will rarely be acted upon. As a millennial, you will have your opportunity to have your own look into your own rear view mirror one day. When you do, remember these:

#1 Start early!

Now is the time to start saving and investing. For example, if you invest $5000 each year from the time you are 25 years of age, you will have over $1 million at age 65. If you put $5000 per year in a mattress, you will have only $200,000. This illustrates the power of investing and compound interest.

#2 Conquer your fears!

Forty percent of millennials surveyed are uncomfortable with investing in stock. This is a fear you need to conquer. For almost 8 decades, stocks have returned more than 10% gains when held over any twenty year period. Bonds, in contrast, have yielded about 4%.

#3 Tune in, turn on and don’t drop out!

Shockingly, about one-third of those between the ages of 25 and 34 do not participate in their employer’s 401(k). Tune in to the benefits your employer offers, turn on the payroll deduction and don’t drop out of the plan. Need a reason? Ten years of savings beginning at age 25 trumps 30 years of savings started at age 35.

#4 Guard your credit score.

Always pay on-time. Carry three or four credit cards but use no more than one or two. A good credit score will save you thousands in interest costs over your lifetime.

#5 Buy previously owned cars.

Want that new car smell? It comes in a spray bottle for $6.99. Buying a second-hand car will save you $9000 over a 5 year period. Avoid buying someone else’s problems by targeting off-lease vehicles. Lease agreements mandate proper maintenance and leasing companies charge the lessee for needed repairs. This removes the financial barrier for leasing companies to repair the problems and enhances your odds of getting a trouble free vehicle.

#6 Watch your pennies!

In short, be thrifty. If you watch the pennies, the dollars will take care of themselves. Your $4, four times a week, Starbucks latte racks up $16 of budget drain each week. Over thirty years that represents about $25,000 that you have quite literally pissed away. Don’t let anyone tell you different. And remember—that doesn’t include any gains you may have enjoyed by investing that money!

#7 Open an IRA account.

There are two types of IRAs, the conventional and the Roth. The conventional IRA is funded with pre-tax dollars. This can save you Federal income tax expense. You will be taxed on this money at withdrawal, but you will likely be in a lower tax bracket at that time. The Roth is funded with after-tax money. As a result, there is no immediate Federal tax relief. However, when you withdraw it, you won’t have to worry about Federal income taxes. Get one of each and cover all your bases.

#8 Set Goals!

If you don’t set goals, you are playing the game but failing to keep score. Goals are the destinations on your financial map. Goals force you to watch the road and keep you from making wrong turns.

Look! I get it! The challenges millennials face are different from the challenges my generation faced, chief among them, crushing student loan debt. Although the challenges faced may be different, the solutions are time-tested and as valid today as they were decades ago.

So I’m passing the baton to you. You can drop it or run with it. Your choice!

Are you willing to take advice? If not, why not? What would motivate you to take action on the tips you’ve read here? Would you be interested in ten more tips for millennials? Whose advice do you trust?

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