Editor’s note: This article was first published in December 2015; Tony Robbins’s estimated net worth of 440 million, his 20 companies, his Fiji resort and his private jet are described as of that year.
Tony Robbins knows what it’s like for a family to have barely enough money for food: that was his childhood. Later, as a grown man, he learned what it’s like to be in debt and to spend the last $20 bill left in his bank account.
But he also knows what it’s like to own an island in Fiji, turned into a resort, and to fly in his own private jet, which he says was one of the best investments he could have made, because he doesn’t have to waste time in airports.
He went from a family that couldn’t afford Thanksgiving or Christmas dinner to a fortune now estimated at $440 million. He has become the world’s go-to personal coach, with several bestsellers to his name, including Unlimited Power and Awaken the Giant Within.
Robbins has coached, among others, Bill Clinton, Paul Tudor Jones, Serena Williams, Leonardo DiCaprio and Nelson Mandela.
None of this would have been possible if he hadn’t listened to several pieces of advice he got from Ken Blanchard, the author of Know Can Do! Looking back, Robbins knows that following that advice is the smartest thing he has ever done with money.
Ken gave Robbins an old piece of advice taken from the classic The Richest Man in Babylon, the bible of financial education on which several authors, including Robert Kiyosaki, have based their work.
Pay yourself first.
This is advice we’ve gone over plenty of times in previous articles (see Even better than paying yourself first: treat every euro as an investment), and it’s one of the most ignored pieces of advice among young people, who are precisely the ones who should apply it without excuses, since they have the chance to quickly unlock the power of compound interest.
Robbins says he set aside 10% of his income to start building his critical mass, committing to put that amount aside every month as soon as he received it.
(See: The 12 worst mistakes people make in their 20s)
When Ken Blanchard gave him this advice, Robbins was 24 and at a critical point in his life and career: he was writing his first book and still building his image and personal brand.
Ken gave him another piece of advice that many business people ignore: never mix your personal finances with your business finances.
Whatever money you put into the business, Ken told him, the business will eat it up. A business is always hungry. Since Robbins was writing a book, and that was outside his main business, he shouldn’t mix the income from the book with the income from the business.
The book would help him grow his brand and his company by connecting closely with people. It would increase his number of fans, and therefore the number of people who would end up doing business with his company.
But he had to make sure to take the profits from that book and set them aside, and never let them mix with the company’s accounts, because businesses are always hungry.
Robbins admits that at the time he didn’t fully understand that advice, but he listened to Ken anyway, and it turned out to be one of the smartest decisions he ever made in business.
Decades later, Robbins has 20 companies and says he is actively involved in running a dozen of them.
Over the years, he says, he never forgot Ken’s words, and they became the foundation of his financial independence as he knows it.
See also: The 6 areas of your life you need to master to control your destiny
Featured image: unknown author, CC0 1.0, via Wikimedia Commons.
