Types of Leverage

Leverage . Concept, types of leverage, when to leverage, techniques, strategies and methods to leverage successfully . Includes downloadable PDF.

In this post I will explain what is the leverage and the different types of leverage, or what is the same: the power of levers or how to leverage your income and business to achieve success .

It is not about working for work, but about doing the minimum necessary to obtain maximum results (minimum effective volume). Tim Ferriss.

Previously, and although many imagine that they will know, we will determine what is that of leverage or leverage income, business or finance.

When it comes to doing things, there are usually two ways: one shorter and one longer, one easier and one more difficult, one that requires more effort and another less.

Using the long and expensive way means that you do everything, exclusively, with your person, your means and your money. Using the easy way and with less effort means that you use tools, strategies that push you further, that allow you to multiply the effects of what you do, even if your intervention and your work is the same.

These tools are the levers, and their use is the use of leverage . We are talking, therefore, of mechanisms that allow us to multiply the effects and increase the speed of what we do. Just as if we used a physical lever.

However, if we resort to traditional definitions, leverage is usually associated exclusively with financial aspects, which in my humble opinion is not so since, as we will see below, there are many ways or means of leverage that have nothing to do with the capital.

However, as I have just said, some relate this figure to money. The Wikipedia , without going any further, says that the leverage is the ratio between credit and equity in a financial transaction, ie, the more credit you use in economic operation more leverage you have. That means that your profit margin is greater (or may be higher), since you get more money by contributing smaller amounts of your own, but also that the risk is greater, because if the operation goes wrong the money must be returned anyway.

I believe that leverage is something much broader and therefore, without further ado, I will now explain how you can leverage your business, income and activities , that is, the different types of leverage .

Types of leverage

# 1 Technology

The use of technology today no doubt that allows us to multiply the effects and speed of what we do. Try to act without internet or a PC and you will see the difference. When we talk, for example, about the sale of infoproducts , using the right platforms is a huge difference compared to not using them.

I have to say that I have always been quite technologically inept, but when I began to discover the benefits of using various devices and systems, I was the first to be amazed and, frankly, I do not cease to be amazed. When had it been seen that someone could be sleeping, or on vacation, and obtaining income in an automated way thanks to online businesses and platforms that exist today? That’s why I say that technology (well used, of course) is equal to leverage .

# 2 Money

In a double sense:

♦ On the one hand, using someone’s money (the OPM, other people money,which the Englishmen would say) means that we can obtain profits that we ourselves could not obtain, since we do not have that money.

♦ On the other hand, giving a signal to the account of the ownership of something, and securing the rest, allows us to acquire the property in question by paying only a part of the amount. This is what happens on occasion, for example, in real estate investments .

(If you want to know money investment strategies, I recommend these articles: Where to invest money and 3 solutions to make money In any case, you can always take a look at the 100 best blogs in business, finance and entrepreneurship )

# 3 Talent 

In this case it is about using someone’s talent . How? Hiring, subcontracting, delegating, commissioning, empowering … in people who have it. It is the collaborative economy, one of the most effective types of leverage that exist and closely related to the 80/20 Law (achieving 80% of benefits with 20% of own work).

Types of leverage.

# 4 Media

Here we talk about media, platforms or systems that belong to other people ( operational leverage ), for example web pages, online stores , affiliation platforms, etc. You can use them and multiply the effects of what you do. And if you know how to do it well, moving in those media can be an extraordinary profession of the future .

# 5 people

We all have contacts (and if we do not have them, we can get them), with which to create networks to expand our products, services or businesses. A network is one of the most effective types of leverage that exist, since each person in turn is connected to others and in this way the network can be extended to infinity.

Networks can lead to multilevel marketing businesses, also called network marketing or marketing networks. But not only that, they can give rise to sales systems by commission and collaborative agreements of different types between people.

# 6 Popularity

If in addition to contacting a person we are lucky that it is popular or known, the effects increase. We are talking about the so-called influencers , who in turn can be celebrities , opinion leaders, famous bloggers , etc.

If you fall in grace (or do you fall for grace) to one of these great, I can tell you that you have already achieved enough. Having a good sponsor is a simple and powerful marketing strategy of a lifetime  ?.

# 7 Financial instruments

If we are engaged in pure and investing money in some places, such as stock markets , we can use mechanisms that enable us to invest X , although we have X , but little or small part of that X . Example: the so-called CFD’s, with which you can acquire a stock amount although you only pay a percentage of the amount of the same. This is the financial leverage , and calculate it and its use is one of the most effective formulas that exist to grow our money.

# 8 Marketing strategies

In general, the use of key strategies  (something basic for the future that awaits us ) always allows us to go further, but specifically marketing strategies (for example experiential marketing , horizontal , vertical …) is something that does not can lack in our business in different ways: know the specific actions to develop, its duration, its timing, the money to invest in each, the periodicity … With strategy we go safe and fast. Without strategy we are leaves moved by the wind.

# 9 Knowledge and training

Something that is also part of the  types of leverage that exist: knowledge and education in key areas, for example taxes. From knowing the tax legislation of your country or sector ( and its use ) to not knowing it, there may be substantial differences between paying more or paying less and between paying immediately or postponing payment (in some cases, more than a year). Interesting, right?

 

# 10 Productivity

And finally, by being productive and learning the strategies to be successful, you will reach far beyond what you set out to do. You can even get one more day a week. You do not believe me? In this free ebook you show it.

Enjoy and be very successful in your projects.

When humanity discovered the lever the world was transformed. If we apply a lever to our physical life, the world is transformed. If we apply a lever to our mental life, the world is still transformed more, because what changes is not the tools, but those who manage them. – Idriss Aberkane –

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