What is your most valuable financial asset? Surprisingly enough, it is not your home, your investments, or your bank account. It is your earning ability. Your ability to earn money is the most precious and perishable asset you have.

It has taken you your entire life to develop your earning ability to the level it is today. Your current earning ability is a combination of your knowledge, skills, experience, education, background, personality, character, and qualities of thought and behavior, such as courage, self-discipline and persistence. By applying your earning ability judiciously, you can earn tens of thousands of dollars each year.94

You could lose your house, your car, your money, and all your other material possessions. But as long as you still have your earning ability, you can walk into the marketplace and earn them all back again.

Your Intangible Assets

Your earning ability is invisible. It is intangible. It is hard to estimate or measure. Two people with the same IQ and grades could graduate from the same college with the same education and begin work at the same time. Ten years later, one of those people has been promoted several times and is earning five or ten times as much as the other. Why does this happen?

The explanation is simple. Your earning ability can be an appreciating asset or a depreciating asset: it can increase in value or decrease in value over time. And this is completely under your control.

An appreciating asset becomes more valuable as time passes. When you dedicate yourself to lifelong learning, to continually increasing your knowledge and skills and your ability to add value wherever you happen to be, your earning ability will appreciate. You will get paid more because you become worth more. By the Law of Cause and Effect, as you increase your earning ability, you increase the value of your contribution and your value in a competitive marketplace.

The Highest Paid Intelligence

According to Howard Gardner at Harvard University, the most important and highest paid intelligence in our society is social intelligence. This refers to your ability to negotiate; communicate; persuade; and sell yourself, your products, and your services to others.

To accomplish anything worthwhile in life, you have to have the help and cooperation of lots of people. Your interpersonal skills are more valuable than anything else in gaining the help and support of others, and they may be underdeveloped.

You may lack the ability to negotiate on behalf of yourself and your business and to get the very best prices when you’re buying or selling. You may lack the ability to sell yourself or your products and services to skeptical consumers who are quite content with what they are currently using.

Step on Your Own Accelerator

Increasing your knowledge and skills is like using high-octane fuel in your engine on the way to your destination. Learning new skills that can increase your contribution is like stepping on the accelerator of your own potential. Simply put, to earn more, you must first learn more. As basketball coach Pat Riley said, “If you’re not getting better, you’re getting worse.”

Unfortunately for most people, their earning ability is a fixed or, even worse, a depreciating asset. Their ability to contribute is not increasing at much more than the rate of inflation, about 3 percent per year. Because of this, most people just have a “job,” which stands for “just over broke.”96

The top 20 percent of people in our society are continually increasing their earning ability, their ability to contribute more and better results to their own company or to their employers. They read the best books, listen to the best educational CDs, watch educational DVDs, and take additional courses in their fields. They pursue learning as if their future depended upon it, because it does.

Write Out the Lessons You Learn

A friend of mine started a marketing business in his twenties. He worked twelve hours a day, seven days a week, for two years, but the business failed and he lost everything.

Then he did something that changed his life. He sat down with a spiral notebook, and at the top of each page, he wrote one of a series of questions:

1. What lessons have I learned about business in general from this experience?
2. What lessons have I learned about customers and markets from this business failure?
3. What lessons have I learned about people and employees from this experience?97
4. What lessons have I learned about partners and business associates?
5. What lessons have I learned about money, banking, and finances?
6. What lessons have I learned about myself and my strengths and weaknesses?
7. What lessons have I learned about producing and delivering products and services from this experience?

He then wrote a full page of answers to each of these questions, as is done in Mindstorming. This spiral notebook became his handbook for his next business venture. Every time he had a problem or difficulty, he referred to the proper page to remind himself of the lessons he had learned.

By the time he was thirty-five, he was a millionaire. By the time he was forty, he was a multimillionaire. By the time he was fifty, he retired to a beautiful home on a golf course in Palm Springs, where he lives to this day.

Achieving Personal Excellence

Personal excellence is perhaps the most important of all invisible and intangible assets that you can acquire. Achieving personal excellence in your business or industry requires lifelong dedication. But once you get into the top 10 percent of your field, you will be one of the highest paid people in the country. You will enjoy the respect and esteem of all the people around you. You will be able to live your life the way you want to live it. You will enjoy high levels of self-esteem, self-respect, and personal pride.98

A gentleman came up to me at a seminar in Las Vegas not long ago. He said, “When you spoke to this company four years ago, you told us that if we had clear written goals, worked continually to upgrade our skills, and never gave up, we could double our income.

“Well,” he said, “you were off by a long shot. I followed your instructions to the letter. I have been working on myself almost every single day for the last four years. But I didn’t just double my income; I have increased my income by almost ten times. Even I have a hard time believing how much money I am making today in comparison to what I was earning before I dedicated myself to getting better every day at what I do.”

Build Your Intellectual Assets

Each person has or can acquire three forms of intellectual capital. These require an investment of study and hard work, but they pay off in higher income for the rest of your life.

The first type of intellectual capital you can acquire consists of your core knowledge, skills, and abilities. These are the result of education, experience, and training. They determine how well you do your job and the value of your contribution to your business. They can be increased and improved almost without limit throughout your life. Sometimes, the addition of one key skill can double the value of your contribution and your income.99

Build Your Internal Knowledge

The second form of intellectual capital that you possess is your knowledge of how your business operates internally, in comparison to that of your competitors or any other business.

Each business develops a series of systems, procedures, methods, techniques, and strategies to market, sell, produce, deliver products and services, and satisfy customers. Each business or organization has its own political and social structure, its pecking order, which determines the relative importance and power of each person and whom you have to work with to get things done.

Each business has internal systems for accounting, administration, and financial controls. These systems take many years to develop and considerable time for a new person to learn. Nonetheless, they are often a key part of the “stock in trade” of the company. A person who knows and understands these systems intimately has a form of intellectual capital that is difficult for the company to replace.100

When my executive assistant of fifteen years comes to me and asks for a salary increase, I realize immediately that to replace her would cost me a lot in terms of time, effort, and expense. It might take months or even years for a new person to acquire her intellectual capital. Her detailed knowledge of every aspect of my business, including customers, contacts, contracts, communications, and the complexities of my business activities, has taken her years to acquire. Giving her a raise is easy when I compare it to the cost of replacing her with someone else. She has made herself extremely valuable.

Build Your Ability to Get Results

The third form of intellectual capital that you possess, and that is perhaps the key determinant of your earning ability, is your knowledge and understanding of how you can get financial results in a competitive market. This includes your knowledge of your products and services and how to sell them. It includes your knowledge of customers and suppliers and how to deal with them. It embraces your familiarity with bankers, lawyers, accountants, and government officials and how to interact with them effectively. This form of intellectual capital may take years to build, and it is extremely valuable to your organization.

Your first responsibility to yourself is to develop your earning ability to a high level. You do this by continually increasing your intellectual capital, by upgrading your ability to do your job, by becoming a valuable part of your organization, and by getting more and better financial results for your organization.101

Your Efficiency and Effectiveness

Your goal is to first make yourself valuable and then make yourself indispensable. The way you do this is to start a little earlier, work a little harder, and stay a little later. You become indispensable by getting more and better results than anyone else in your position. As you get a reputation for making a valuable contribution, you will quickly come to the attention of people who can help you move ahead. You will be paid more and promoted faster at every stage of your career, whether running your own business or working for someone else.

Chance Favors the Prepared Mind

You can improve your ability to capitalize on the invisible influences that can help you succeed greatly. The key is to continually take in new information. Read the books, magazines, and newsletters produced by the experts in your field. Attend the annual meetings of your industry association and learn everything you can from the experts in your business. Meet regularly with other people who work in your business and trade ideas with them.

By the Law of Probability, you can never know which idea will be the breakthrough idea that saves you years of hard work in achieving a certain level of success. You must therefore expose yourself to as many ideas and as much information as possible to increase the probability that you will have the right idea for the right situation at the right time.102

The Top 10 Percent in Your Field

To achieve all that is possible for you in your chosen career, you must dedicate yourself to getting into the top 10 percent. This idea comes as a shock to many people. When I first learned that to succeed greatly, I would have to be in the top 10 percent in my field, my initial reaction was disappointment and discouragement. I had not graduated from high school. I had worked at laboring jobs for several years before I got into sales. I had been fired and laid off multiple times and had been broke or nearly broke well into my thirties.

Then I learned something that changed my life: everyone who is in the top 10 percent today started in the bottom 10 percent. Everyone who is doing well today was once doing poorly. As speaker T. Harv Eker says, “Every master was once a disaster.”

Everyone Starts at the Bottom

Just think! Everyone who is at the top of your field today was at one time not in your field at all and did not even know that it existed. Today they are at the top and earning several times the average income. And the best news is, whatever countless other people have done, you can do as well if you simply learn how.103

No one is better than you and no one is smarter than you. You have more talent, ability, and intelligence than you could use in one hundred lifetimes. By the Law of Cause and Effect, if you learn and practice what other successful people are doing, you will eventually master the same skills that they have and get the same results that they do.

There are no limits except those that you impose on yourself with your own thinking.

Here is the tragedy: the absence of a commitment to excellence becomes, by default, an acceptance of mediocrity. No one ever became excellent accidentally. Like achieving any long-term, worthwhile goal, becoming excellent at what you do takes a long, long time.

The Achievement of Mastery

How long will it take for you to get to the top of your field? In more than fifty years of study into the subject of mastery, the experts have determined that it takes approximately seven years, or ten thousand hours, of hard, focused effort for someone to get into the top 10 percent of any field.

It takes seven years to become an excellent neurosurgeon. It takes seven years to become a top salesperson. It takes seven years to become a successful entrepreneur. It takes seven years to become a top diesel mechanic. Whatever your chosen profession, it takes about seven years to get to the top.104

When I share this with my audiences, they often react with disappointment and dismay. But the facts are the facts. Perhaps you can beat the averages, but don’t bet on it. The reason that it takes seven years or ten thousand hours of hard work is because that is the length of time necessary for you to master your craft, to become truly excellent at whatever you do.

The Time Is Going to Pass Anyway

Sometimes people will say, “Wait a minute! I’m thirty years old right now. What you are saying is that I will be thirty-seven years old before I get into the top 10 percent and start to enjoy the big rewards in this field. Do you realize that I will be seven years older?”

I then ask a simple question, “How much older will you be in seven years in any case? Seven years from now, you will be seven years older than you are today. The only question is, Will you be at the top of your field, or will you still be in the bottom 80 percent, earning an average living, and worrying about money most of the time?”

The same rule applies to business success. According to a study of 30,000 businesses by a major accounting firm, a new business loses money for the first two years.

In the next two years, it earns enough money to pay back the losses from the first two years. At the end of the fourth year, the business starts to earn net profits. Only in the seventh year does the business begin to take off, often making more money in a year than it made in the previous five to seven years. As Peter Drucker said, “No new business makes a profit within the first four years.”105

Put Yourself onto the Fast Track

So, how do you reach cruising altitude as quickly and as predictably as possible? The answer is simple: knowledge, skill, and hard work.

Dedicate yourself to continuous learning, to nonstop personal and professional development. Read in your field daily, listen to educational CDs in your car, attend seminars to learn new skills, and take additional live and online courses. Never stop learning and upgrading your knowledge.

Turn this knowledge into skill by continuous practice. Realize in advance that most new techniques that you try won’t work the first time. Be prepared to work at the new skill until you master it, no matter how long it takes.

Learning a new skill is like learning how to prepare a new dish at home. No matter how good it tastes when prepared by an expert cook, your first attempts will not be as successful. But when you practice with a new recipe, continually adjusting the ingredients and changing the way that you prepare it, eventually the dish will taste delicious. From that point onward, you can prepare that dish in a superb fashion every single time.

It is the same with any business skill. At first, you will be clumsy and awkward. But as you work with the skill, over and over, you will eventually master it and own it for life. This is one of the most important principles of success you’ll ever learn.106