The Book That Changed My Life

American poet, critic and diplomat James Russell Lowell has a quote about books: “Books are the bees which carry the quickening pollen from one to another mind”. Books are essentially vessels that contain the ideas, thoughts and knowledge of its writers or authors. Books are very powerful knowledge tools because the ideas and knowledge written into these collection of papers are preserved for many generations. I’ve read many great books, but there is one book that I must highlight here: the book that changed my life. The title of this book is ‘The Parable of the Pipeline’ by Burke Hedges, an author, speaker and entrepreneur. It was in 2010 when I read this book, and my life has never quite been the same since. It has given me a paradigm shift from an employee mindset to an entrepreneur mindset. This book has taught me about the concept of leverage and also the importance of building a system of pipelines which will generate future residual income regardless of your active income.

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The author started by telling an inspiring story about two ambitious young men from Italy in the 19th century who were hired to deliver buckets of water from the lake to the village. The first man would work hard carrying more buckets a day and eventually carrying bigger buckets to earn more money. The second man would carry the bucket as usual while working hard to build a pipeline from the lake to the village. Eventually, as time passed, the pipeline builder found out that he did not have to work anymore because his pipeline would deliver the water to the village for him. Money flows into his pocket even when he is not working. From this story I understood that in this world, there are two types of people; the bucket carriers, and the pipeline builders. The bucket carrier is none other than most of the people in this world: people who trade their time for money, who also happen to cling to job security and live from paycheck to paycheck. On the other hand, the pipeline builders constitute to only less than 5% of the world population; these people are also known as entrepreneurs, business owners and sophisticated investors. The pipeline builders have already built ‘pipeline’ systems which generate income for them 24/7. Before reading the book, I thought the only way to be rich and successful is to find a job which pays high. And in order to achieve that, I have to study hard for good grades, and then work harder and longer.

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Another importance which I would love to highlight here is the concept of leveraging which was introduced to me at that time. The word 'leverage' simply means to make lighter something by the use of a lever (a tool). In the book, there are two main types of leverage explained: the leverage of money, and the leverage of time.

The leverage of money works primarily through saving and investing, whereby your money works to make more money for you. By investing a portion of your income into an investment vehicle (stocks, bonds, real estate, unit trusts and many more) consistently, your money will grow bigger and bigger through the power of compounding. The Rule of 72 is a useful formula could be used for calculating how long would it take for an investment to double.

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However, the process of leveraging money is often very long (up to decades), especially if you could not set aside a large enough portion of your income for your investment, or the ROI (Return on Investment) of your investment is low. The good news is - there is another more powerful form of leverage that everyone could use free-of-charge. This second form of leverage is the leverage of time, which works by building a system or ‘pipeline’ which allows you to do more with less.

One example on how to apply the concept of time leverage in building wealth and success is the franchise model. The franchise system works whereby the franchise owner (franchisor) sells to the franchisee a license to use the business’s trademark, processes and knowledge to sell a product or service under the business’s name. In this model, you could earn more with the same amount of effort. Some notable franchise businesses include McDonalds, KFC, Old Town White Coffee, and Subway.

The other example on how to leverage time is to harness the power of technology. Today, in the Information Age, information and knowledge transfer has never been quicker and easier before with the invention of the Internet. Most of the information could be obtained from the Internet for free, and businesses can be operated online at the fraction of the cost required to operate a traditional brick-and-mortar business.

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To wrap this up, this is a life-changing book for me. A brand new reality, a reality of new possibilities was introduced to me. Life has never really been the same ever since. Although I still have not achieved my goals of building a successful business and being financially free, I am now constantly working towards it and I feel closer to my dreams with each step that I take. Instead of focusing in the reality of trading time for money, I now focus on the reality of working to build pipelines which will bring me more and more residual income in the future. I’d love to quote Robert Kiyosaki in his book ‘Retire Young, Retire Rich’:

“People who only work hard have limited leverage. If you’re working hard physically and not getting ahead financially, then you’re probably someone else’s leverage”.

I hope that this article has been able to light up the bulb in your head, and inspired you to do more with less!

Here are some of my previous posts which you could read:

1. My First (Introduction) Post in Steemit
2. Why Haven't You Achieved Your Goals (And How You Could Achieve Them
3. 5 Simple Steps to Increase Your Cashflow

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