MONEY Warren Buffett

Warren Buffett Just Predicted the Next 50 Years for Berkshire Hathaway

Warren Buffett
Lacy O'Toole—NBCU Photo Bank via Getty Images

While the days of Berkshire's amazing 20% average annual returns are likely a thing of the past, Buffett expects Berkshire to outperform the market.

Berkshire Hathaway is one of the most fascinating stories in the history of investing. In the 50 years Warren Buffett and his management team have been running things, a struggling textile company has transformed into one of the largest corporations in the world, with dozens of household-name subsidiary companies and an equally impressive stock portfolio. In the process, early investors have gotten very rich, with the per-share book value rising from $19 to $146,186 during the past half-century.

In Buffett’s most recent letter to shareholders, he discussed his thoughts on Berkshire’s next 50 years. Here’s what Berkshire investors can expect — straight from the pen of the Oracle of Omaha:

Berkshire will not be a good short-term trade, ever

Buffett said that the chance of permanent capital loss with Berkshire is the lowest among any single-company investment. But he added a caveat: If the company’s valuation is high, say approaching two times book value (it’s at about 1.5 times book value now, so not too far off), it could be years before investors realize a profit.

In other words, Berkshire has never been, and will never be, a good “traders’ stock.” The company has one of the most shareholder-friendly business models in the world, but it is geared exclusively toward long-term investors. As a result, Buffett recommends that investors should look elsewhere for investment options if they plan to hold their shares for less than five years.

Berkshire can survive the “thousand-year flood”

Not only will Berkshire be prepared to withstand any economic storm, but the company is positioned to capitalize when things go bad. The company maintains a huge earnings stream, a great deal of liquid assets, and virtually no short-term cash requirements.

This combination keeps Berkshire immune to virtually any adverse market conditions. This is illustrated by the company’s performance during the financial crisis of 2008-09, when Berkshire not only survived, but took advantage of “discounts” in companies like Goldman Sachs.

Berkshire will maintain rather large stockpiles of cash (at least $20 billion at all times, according to Buffett) in order to weather any storm and capitalize on developing opportunities. As Buffett said, “if you can’t predict what tomorrow will bring, you must be prepared for whatever it does.”

Earnings power will continue to grow

Perhaps Buffett’s boldest prediction is that Berkshire can build its per-share earning power every year. This might sound like a lofty expectation, considering he’s talking about a five-decade period. However, it could be achievable.

Now, this prediction doesn’t mean earnings will increase every year. It does, however, mean that each and every year, Berkshire will create the potential to earn more than it did the year before. Actual earnings gains (and declines) will depend on the U.S. economy, but the company will keep moving forward no matter what the economy is doing.

Past performance will not be duplicated

Many casual observers were put off by the following line from the letter: “Berkshire’s long-term gains … cannot be dramatic and will not come close to those of the past 50 years.”

However, this really shouldn’t be much of a surprise. There is only a finite amount of money and investment opportunities in the world, and as companies grow, it gets tougher and tougher to maintain a high growth rate. For example, Apple has increased in value by more than 100-fold since 2004. Would it be reasonable to expect the same over the next decade? Of course not! That would make Apple a roughly $70 trillion company.

The same principle applies to Berkshire. Repeating its performance of the past 50 years would produce a book value per share of roughly $1.2 billion, along with a market capitalization of more than $900 trillion, which would be completely impossible in the absence of extreme inflation.

But the right people are in place to deliver for shareholders

While his time at the helm might be nearing its end, Buffett reassured investors that over the next 50 years, no company will be as shareholder-oriented as Berkshire. Buffett is completely confident the company will have the right CEO, management team, and investment specialists in place, as well as safeguards to protect shareholders in the event that the wrong person is put in charge.

As Buffett stated in a past letter to shareholders: when the market soars, Berkshire may underperform; when the market is down, Berkshire will outperform; and over any full economic cycle, Berkshire will outperform the markets. While the days of Berkshire’s amazing 20% average annual returns are likely a thing of the past, the company’s winning philosophy and business model remain the same, and will deliver for shareholders for decades to come.

MONEY College

Graduates of These Colleges Make the Most Money (and It’s Not Just the Ivies)

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Lawrence Sawyer—Getty Images

Party schools do better than you'd think—but there's a twist.

Far and away, the nation’s science, math, technology, and Ivy League colleges produce the highest-earning graduates, according to PayScale.com salary data released today.

The average grad of math- and science-heavy colleges such as Harvey Mudd, CalTech, and the Georgia Institute of Technology out-earned grads of any other type of college, netting $677,000 more in earnings over 20 years than someone who didn’t attend college at all (minus the cost of attending the college).

Graduates of the Ivy League came in a close second, netting $650,000 in extra earnings over the first 20 years of their career. Both groups of schools report returns on investment that are at least 80% higher than any other type of school in PayScale’s analysis.

Hope if You’re Hopeless at Math

But what if you’re not a math genius, or lucky enough to get into an Ivy League college?

PayScale says the next-highest-earning group of colleges are so-called “party schools,” such as the University of Florida, Syracuse University, and Penn State, whose graduates’ salaries over 20 years added up to a net extra $354,000.

Graduates of research universities, such as large private universities and flagship public schools, and so-called “sober” schools, such as religious schools, commuter colleges, and military academies, earned just slightly less, on average, than party school alums.

Graduates of arts and liberal arts schools reported comparatively low salaries, notching a return on investment over 20 years of about $200,000. Music school graduates had the lowest average 20-year return of just $128,000 over their costs.

So Party On?

PayScale spokeswoman Lydia Frank says neither parents nor students should take the party school findings too seriously, however. “That was just a fun comparison and kind of surprising,” she says. “Apparently there is some studying happening in between partying.”

What’s more, the salaries reported on PayScale.com are only for college graduates whose education ended with a bachelor’s degree and who work full-time. All the students who couldn’t balance partying with class work and dropped out aren’t counted.

That could be a big number. There is plenty of research that shows that students whose partying involves lots of drinking flunk or drop out at a higher rate than those who have more moderate social habits. And federal earnings data show that college dropouts have a harder time finding jobs, and earn less, than college graduates do.

Meanwhile, other studies shows that the more time undergraduates spend intensely studying–especially studying alone–the better their odds of getting a good job after school.

Scott Carrell, an economist at UC Davis who has studied how alcohol use affects academic performance, says that the PayScale findings could reflect one important truth: Students who manage to graduate from a party school may have developed self-restraint, social skills, and networks of friends that help them find better paying jobs after graduation.

But Carrell also questioned the accuracy of Princeton Review’s labeling of selective universities such as the University of Florida and UC Santa Barbara as “party schools” over less selective and, perhaps, jollier schools such as Chico State University.

The bottom line, Carrell says, is that students shouldn’t conclude from the PayScale data that it pays to go to a “party” school because, he says, “you don’t know if you will be the one who drops out.”

The Top 10

These 10 colleges were ranked highest in PayScale’s latest return on investment analysis: the total average earnings for each school’s graduates over 20 years, minus the cost of attendance and the average pay of someone who didn’t attend college.

College 20-year ROI
Harvey Mudd College $985,300
California Institute of Technology (Caltech) $901,400
Stevens Institute of Technology $841,000
Colorado School of Mines (in-state) $831,000
Babson College $812,800
Stanford University $809,700
Massachusetts Institute of Technology (MIT) $798,500
Georgia Institute of Technology $796,300
Princeton University $795,700
Colorado School of Mines (out-of-state) $771,000

Money uses PayScale.com earnings data as a part of its college rankings, but balances that data with graduation rates, student loan repayment rates, educational quality indicators, and value-added measures. See which colleges Money judges offer the best value overall.

MONEY Earnings

The 3 Best Ways to Boost Your Earnings This Year

hand holding dumbbell with coin at the end
Sarina Finkelstein (photo illustration)—Getty Images(2)

To pump up your salary, switch up your career routine.

Welcome to Day 8 of MONEY’s 10-day Financial Fitness program. By now you’ve seen what shape you’re in, bulked up your savings, and cut the fat from your budget. Today, add some muscle to your paycheck.

When you hit a fitness plateau, taking a new class or picking up a sport can be the key to breaking through to the next level. The same concept applies to your career. Landing a new job will likely result in a salary 18% to 20% higher than what you’d get via an internal promotion, according to a study by Wharton professor Matthew Bidwell.

Thanks to a rapidly rebounding job market, this is the best year since the recession to get a new gig. More than one-third of employers expect to add full-time employees in 2015, according to CareerBuilder’s annual job forecast, up from one in four last year. Here’s how to stand out.

1. Get the Inside Scoop

Employee referrals generate a full 40% of new hires, according to the JobVite 2014 Recruiting Survey. So rather than scouring the job boards, talk to people you know and ask about openings at their firms. Love a certain company but don’t know anyone there? Reach out to your personal network or tap your LinkedIn contacts to see if anyone can connect you to an employee.

2. Make Yourself Poachable

Employers are increasingly courting passive job seekers, says John Hollon, editor of TLNT.com, which covers HR trends: “These are employed workers who may be willing to switch jobs but aren’t actively searching.” Recruiters like these candidates because they’re successful and valued at their current jobs. Interested? Get on hiring managers’ radar by peppering your LinkedIn profile with keywords related to the type of job you want. You can also sign up with the website Poachable, and get the Poacht app. List your dream job and resume for recruiters to browse.

3. Be Bold

That said, maybe you love your job or just can’t move right now. That doesn’t mean settling for a middling raise. While the biggest bumps do go to top performers, simply asking goes a long way. A new study from Payscale found that 75% of employees who requested an increase got one, with 44% landing the exact figure they asked for. The odds of receiving your requested amount are even better if you’re already a high earner: Those with a salary of $150,000 or more had a success rate of 70%. Before you ask, get a sense of the budget. You have more influence when you show you see the boss’s side, says career coach Lee Miller.

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MONEY Social Security

Why a Better Job Market Can Mean a Social Security Bonus

Getting back to work for even a few years before you retire can make a big difference to your income.

More Americans over 55 are finally getting back to work after the long recession. The strong national employment report for January released last week confirmed that. The unemployment rate for those over 55 was just 4.1% in January, down from 4.5% a year ago and well below the national jobless rate. The 55-plus labor force participation rate inched up to 40% from 39.9%.

That is good news for patching up household balance sheets damaged by years of lost employment and savings, and also for boosting future Social Security benefits.

Social Security is a benefit you earn through work and payroll tax contributions. One widely known way to boost your monthly benefit amount is to work longer and delay your claiming date. But simply getting back into the job market can help.

Your Social Security benefit is calculated using a little-understood formula called the primary insurance amount (PIA). The PIA is determined by averaging together the 35 highest-earning years of your career. Those lifetime earnings are then wage-indexed to make them comparable with what workers are earning in the year you turn 60, using a formula called average indexed monthly earnings (AIME); finally, a progressivity formula is applied that returns greater amounts to lower-income workers (called “bend points”).

But what if you are getting close to retirement age and have less than 35 years of earnings due to joblessness during the recession?

The Social Security Administration still calculates your best 35 years. It just means that five of those years will be zeros, reducing the average wage used to calculate your PIA.

By going back to work in any capacity, you start to replace those zeros with years of earnings. That helps bring your average wage figure up a bit, even if you are earning less than in your last job, or working part time.

“Any earnings you have in a given year have the opportunity to go into your high 35,” notes Stephen C. Goss, Social Security’s chief actuary.

I ran the numbers for a an average worker (2014 income: $49,000) born in 1953, comparing PIA levels following 40 years of full employment with the benefit level assuming a layoff in 2009. The fully employed worker enters retirement at age 66 (the full retirement age) with an annual PIA of $20,148; the laid-off worker’s PIA is reduced by $924 (4.6%). Getting back into the labor force in 2014, and working through 2015, would restore $720 of that loss.

That might not sound like much, but it would total nearly $25,000 in lifetime Social Security benefits for a female worker who lives to age 88, assuming a 3% annual rate of inflation. And for higher income workers, the differences would be greater.

You also can continue “backfilling” your earnings if you work past 60, Goss notes. “You get credit all the way along the way. If you happen to work up to age 70 or even beyond, we recalculate your benefit if you have had more earnings.”

The timing of your filing also is critical. You’re eligible to file for a retirement benefit as early as age 62, but that would reduce your PIA 25 percent, a cut that would persist for the rest of your life. Waiting until after full retirement age allows you to earn delayed filing credits, which works out to 8% for each 12-month period you delay. Waiting one extra year beyond normal retirement age would get you 108% of your PIA; delaying a second year would get you 116%, and so on. You can earn those credits up until the year when you turn 70, and you also will receive any cost-of-living adjustment awarded during the intervening years when you finally file.

Getting back to work will be a tonic for many older Americans, but what they might not realize is that it is also a great path to filling their retirement gap with more robust Social Security checks.

TIME Food & Drink

3 Charts That Show Why No One Wins the Coke vs. Pepsi Fight

Coke Pepsi Charts
Bloomberg via Getty Images

It's no longer a matter of who's winning—it's about who's losing the least

It’s a question that’s been around about as long as the oldest human living on Earth: Coke or Pepsi?

Lately, the answer is “neither.”

Health-conscious consumers have been turning away from sugar-sweetened beverages, and that’s causing headaches for the country’s top soda sellers. Coca-Cola reported a 55% drop in quarterly profit Tuesday, while PepsiCo investors are also bracing for less than stellar news when that company posts earnings Wednesday. Coke actually saw its first rise in North American sales in four quarters, but that was thanks to price hikes rather than increased demand.

All told, nobody’s really winning the soda wars. Soda sales have been in decline since 2005, falling 3% in 2013 alone, according to market research publication Beverage-Digest. Coke and Pepsi have both posted negative yearly sales changes for the last 11 years, though Coke has better weathered the storm:

If you think soda’s salvation lies in the word “Diet,” think again. Health experts have for years rejected the myth that “diet” soda is a healthy alternative. Now, consumers are distancing themselves not just from sugar-sweetened drinks, but also their artificially-sweetened cousins:

One corner of the beverage industry that’s actually winning? Energy drinks. Compared to the contracting Coca-Cola and PepsiCo businesses, energy drink companies like Monster and Red Bull have consistently experienced positive yearly growth:

Both Coca-Cola and PepsiCo have gotten in on the energy drink game: Coca-Cola bought a stake in Monster last year, while PepsiCo has shunned acquisitions, instead focusing on its own Mountain Dew Kickstart. Those moves have turned energy drinks into the latest battle ground between these perennial beverage titans.

Read next: This Smart Cup Knows What’s Inside of It

Listen to the most important stories of the day.

TIME Earnings

GoPro Rides Big Wave of Camera Sales, But Shares Wipe Out

Newest Innovations In Consumer Technology On Display At 2015 International CES
David Becker—Getty Images A GoPro Hero 4 camera is displayed at the 2015 International CES at the Las Vegas Convention Center on January 6, 2015 in Las Vegas, Nevada.

The action camera maker’s stock tumbled 15% despite strong revenue and profit growth.

Action camera maker GoPro reported fourth-quarter revenue of $634 million, beating Wall Street’s predictions thanks to strong holiday sales. Here are the key points from Thursday’s earnings release.

What you need to know: GoPro’s $634 million in quarterly revenue improved 75% year-over-year and more than doubled the company’s third-quarter sales of $280 million. The San Mateo, Calif.-based company easily outpaced the expectations of analysts, who predicted revenue of $580 million, according to Thomson Reuters. GoPro closed out 2014 with a 41% increase in annual revenue, to $1.4 billion.

GoPro’s quarterly profits nearly tripled to $122.3 million from $43.7 million during the same period in 2013. The company’s annual profits more than doubled, growing to $128.1 million from $60.6 million a year earlier.

The company also announced that COO Nina Richardson is leaving GoPro at the end of February. The company’s stock dropped more than 15% in after-hours trading following a day in which GoPro shares already improved by nearly 5%.

GoPro’s shares were down nearly 30% over the past three months. The company’s shares were in high demand for months after a successful IPO last June, but began to reverse course in the fall. (The company’s shares are still selling for more than double their $24 IPO price.)

Recently, GoPro’s stock fell dramatically as the market responded to Apple receiving a new patent for a wearable video camera that could potentially rival GoPro’s own products.

The big number: Last month, GoPro CEO Nick Woodman boasted about the company’s uptick in sales during the holiday season, telling CNBC that “it was a GoPro Christmas” for the company as well as for retailers and customers. The launch of a new version of GoPro’s Hero line of wearable sports cameras in September helped make it a strong holiday season.

GoPro shipped 2.4 million cameras in the fourth quarter, which represents an improvement of 68% over the same period in 2013. In fact, the company said shipped more units in this most recent fourth quarter than it did in all of 2012. The company’s 5.2 million shipments for the whole of 2014 marked a 35% jump over the previous year’s shipments.

What you might have missed: GoPro has been touting its strategy to expand beyond just camera sales to a full-fledged media company, and it noted in the earnings release the importance of adding live-broadcast capability to its cameras. Last month, the company announced a long-term partnership with the National Hockey League that will see the league’s players and referees using GoPro cameras to film live action during games.

Also on Thursday, GoPro announced a deal with streaming media company Roku to add a GoPro channel to Roku’s portfolio of streaming content. GoPro previously announced a similar partnership with Microsoft’s Xbox gaming console.

TIME stocks

Twitter Stock Pops as Company Tops Earnings Expectations

FIThe Twitter logo is displayed on a banner outside the New York Stock Exchange in New York City in 2013.LE: Twitter To Announce 4Q Earnings
Andrew Burton—Getty Images The Twitter logo is displayed on a banner outside the New York Stock Exchange in New York City in 2013.

The company reported a 97% jump in quarterly sales as it pursues profitability

Twitter reported a 97% jump in sales in the fourth quarter, continuing its impressive streak of doubling revenue nearly every quarter. The company’s shares were up 12% in after-hours trading.

The company’s impressive growth in revenue is often obscured amid the criticisms of the company. One such criticism: Twitter is not profitable, and continues its streak of losing a lot of money. In 2014, it earned $1.4 billion but posted a net loss of $577 million.

What you need to know: The company beat earnings estimates by a significant margin, earning $497 million on an expected $453.6 million in sales.

It’s a much-needed boost for Twitter. Through the last quarter analysts, investors, and the tweet-happy peanut gallery have criticized the Twitter for its slow user growth and lack of vision, even calling for CEO Dick Costolo to step down. This week, Twitter built up positive momentum, announcing an intriguing new revenue stream through syndicated Tweets and a reportedly renewing a lapsed partnership to with Google.

The big number: 288 million monthly active users. This is a 20% increase over last year, and includes the loss of four million users due to third-party integrations.

Twitter has taken heat for its inability to increase active users. Last quarter, Instagram surpassed Twitter in monthly active users with 300 million, for example. Analysts have focused on this metric, alongside Timeline views, which grew 23% year-over-year, because those were the key metrics Twitter identified when it went public in 2013. Recently, though, Twitter has moved away from the focus on monthly active users, emphasize its influence off of Twitter. This includes the plan to syndicate Tweets to other apps, including Flipboard and Yahoo Japan.

What you might have missed: Twitter is unprofitable, but it is appears to be closing the gap to profitability. In the fourth quarter of 2013, Twitter posted a net loss of $511 million on $242 million in revenue. In 2014, that shrunk to a net loss of $125 million on $479 million in revenue.

This article originally appeared on Fortune.com.

TIME Social Media

Your Tweets Will Soon Show Up on Google Search Results

Users should see the change sometime in the first half of this year

Our 140-character tweets will appear more prominently on Google searches in coming months thanks to a deal reportedly signed between the search engine and Twitter.

Instead of crawling for data, as Google previously had to do, the search engine giant will now have access to Twitter’s firehose, basically a flow of data created by the microblogging company’s 284 million active users, according to sources cited by Bloomberg.

In layman’s terms, this means users will be able to view live tweets instead of Google’s current model of just showing the profile information.

Twitter also provides data to Yahoo! and Bing.

The deal reportedly does not include advertising revenue, but Bloomberg suggests Twitter will receive data-licensing revenue, which reached $41 million in the third quarter of 2014.

Engineers from both companies have reportedly already begun the process of designing the new search arrangement.

Twitter CEO Dick Costolo is trying to boost his company’s users to compete with more popular social-media sites like Facebook, with 1.4 billion users, and Instagram, which boasts 300 million users and is also owned by Facebook.

The company’s growth rate has clearly disappointed investors and stock has dipped from nearly $66 per share at this time last year to just over $40 today.

News of the deal comes as the Verge reports that Costolo worries Internet trolling is negatively impacting the company’s growth potential.

“It’s no secret and the rest of the world talks about [trolling] every day. We lose core user after core user by not addressing simple trolling issues that they face every day,” he said.

Twitter is set to report fourth-quarter earnings Thursday.

TIME Careers & Workplace

How to Create Multiple Streams of Income

multi-colored-piggy-banks
Getty Images

Diversifying your income stream is crucial to protect yourself and your family against the unavoidable ups and downs in finances

“Don’t let the opinions of the average man sway you. Dream, and he thinks you’re crazy. Succeed, and he thinks you’re lucky. Acquire wealth, and he thinks you’re greedy. Pay no attention. He simply doesn’t understand.”
Robert G. Allen

At age 25, I began planning my exit strategy to leave a lucrative career in sales to become an entrepreneur and pursue my passion: empowering people to maximize their potential and make significant improvements to their results.

While still in my sales position, I started my first business — and my first additional stream of income — serving as a life and business success coach. In the past nine years, using the exact formula below, I’ve been able to add nine additional streams of income. These have involved authoring books, speaking, private and group coaching and staging live events.

For anyone who values financial security and ultimately desires financial freedom, creating at least one additional stream of income is no longer a luxury. It has become a necessity.

Diversifying your income stream is crucial to protect yourself and your family against the unavoidable ups and downs of economic and industry cycles. Because of the financial risks that come from relying on one source of income, such as a job or a business, consider creating at least one or more additional streams to generate cash flow.

Your additional income streams can be active, passive or a combination of the two. Some may pay you for doing something that you love (active), while others can provide income for you without your having to do much of anything at all (passive). You can diversify your income streams among different industries to protect you against major losses during downturns in one market and allow you to financially benefit from the upswings in another.

This truly is one of the not-so-obvious secrets of how the wealthy become — and stay — wealthy, which unfortunately isn’t taught to the masses. The good news is that it’s not magic. It’s not even complicated. Creating your next stream of income is a simple, step-by-step process, which you can arrange to start bringing you monthly income faster than you might realize is possible.

Related: The 3 Decisions That Will Change Your Financial Life

1. Establish financial security.

Now, this idea isn’t sexy, but it’s imperative: Don’t focus your time and energy into building a second stream of income until your primary source is secure. Whether you have a day job or own your own business, focus on establishing and securing a primary monthly income that will support your expenses before you pursue other steps.

2. Clarify your unique value.

Every person on this planet has unique gifts, abilities, life experiences and value to offer — and be highly compensated for. Figure out the knowledge, experience, ability or solution you have that others will value and might pay you for. Remember, what might be common knowledge to you isn’t for other people.

You and your personality differentiate your value from that of every other person on earth. Many people will resonate with you (and your style) better than they will with someone else offering value that’s similar or even the same.

Packaging is how you can differentiate your value. When I wrote my book The Miracle Morning, I had to overcome my insecurity that waking up early wasn’t exactly something I invented. Would there really be a market for the book? But readers shared that the book was life-changing in the way the information was presented. It was written focusing on how to significantly improve any area of life by simply altering how a person starts the day.

Knowledge is the one thing you can increase very quickly. As Tony Robbins wrote in Money: Master the Game, “One reason people succeed is that they have knowledge other people don’t have. You pay your lawyer or your doctor for the knowledge and skills” you lack.

Increase your knowledge in a specific area, and you’ll simultaneously increase the value that others will pay you for, either to teach them what you know or apply your knowledge on their behalf.

Related: Create Side-Hustle Income by Teaching What You Already Know

3. Identify your market.

Determine whom you are best qualified to serve. Based on the value you can add for others or the problems you can help people solve, who will pay you for the value or solution you can provide?

4. Build a community.

A turning point in my financial life came when I heard author and self-made multimillionaire Dan Kennedy say, “The most valuable asset you have is your email list, so focus on growing it.”

I don’t like to think of my email community as merely a list of names but rather as a group of individuals, each with their own hopes and dreams.

Here’s how you can build your community:

Acquire an email-marketing program (good: AWeber, better: Infusionsoft).

Get a program to create an opt-in page (good: LeadPages.com, better:Kajabi).

Create an added-value deliverable such as a free report, an ebook, an audio or a video training so that people will happily provide their email address in exchange for the value you provide.

5. Ask your community about their desires.

You can either guess or assume what people desire and need, invest valuable time in creating it and then hope your guess was correct. But remember: Hope is rarely the best strategy.

Or send an email to members of your community with the link to a survey (using a free service like SurveyMonkey), asking what they want or need help with in your area of value that you’ve identified. Ask open-ended questions to help you later brainstorm or offer multiple choices if you’ve already thought about what you can provide.

6. Create a solution.

After your community members tell you what they need, it’s your golden opportunity to get to work and create it. This could be a physical or digital product (a book, an audio, a video, a written training program or software) or a service (dog grooming, babysitting, coaching, consulting, speaking or training).

7. Plan the launch.

Think about how Apple rolls out its products. The company doesn’t just throw a product on the shelf or its website. No, the company makes it into an event. Apple builds anticipation months in advance, so much so that people are willing to camp out in front of stores for weeks to be the first in line.

Do that. To learn how, read the definitive book on the topic, Launch by Jeff Walker.

7.1. Find a mentor.

The best way to cut your learning curve and achieve a specific result is to find people who’ve already achieved what you want and then model their behavior. Rather than try to figure it all out on your own, find someone who has already achieved what you want, determine how this person did it, model this behavior and make it your own.

While you might seek a relationship with a face-to-face human mentor, you could also hire a coach, read a book or articles by an expert or do web research. After some consideration, you may decide to make this your first step.

Schedule time to begin implementing these 7.1 steps, one at a time, and within months you can be enjoying the benefits, the perks and the financial security and freedom that comes from having multiple streams of income.

Related: Create Momentum When You’re Stuck in the Middle

This article originally appeared on Entrepreneur.com.

TIME Earnings

Frozen Sales Drive Revenue for Disney

The entertainment giant reported strong gains in revenue as its hit animated film continued to lift merchandise sales

Revenue for the first quarter of the Walt Disney Company’s 2015 fiscal year jumped 9% as sales of merchandise from the hit animated film Frozen dominated the holiday season. Here are the key points from Tuesday’s earnings report.

What you need to know: Frozen remains one of Disney’s hottest properties more than a year after it became the highest-grossing animated film of all time. The film’s merchandise lifted last year’s U.S. retail toy sales and contributed to a strong quarter for Disney, which also saw steady growth from its television and cable networks including ABC and ESPN.

Disney’s first-quarter revenue improved 9% from the same period last year, to $13.4 billion, blowing past analysts’ prediction of $12.9 billion. The company’s profits of $2.2 billion, or $1.28 per share, represented a 19% increase.

In a statement, Disney CEO Bob Iger bragged that the results “once again reflect the strength of our brands and high quality content and demonstrate that our proven franchise strategy creates long-term value across all of our businesses.” Last year, Disney’s board handed Iger, who Fortune recently profiled, a contract extension through 2018. In 2014, Disney extended its streak of record-breaking annual revenue to four straight years.

Disney’s stock jumped more than 3% in after-hours trading after the company released its latest earnings.

The big number: The “Mouse House” reported a 22% bump in consumer product sales for the quarter, to $1.4 billion. Frozen merchandise sales drove the increase once again. Toys and other products related to the film, which was actually released in November 2013, sold well throughout 2014 and drove a 7% increase in full-year consumer product sales last year for Disney.

Disney’s largest and most profitable segment, its television and cable networks, posted first-quarter revenue of nearly $5.9 billion. That marked an 11% increase over the same period last year despite rising programming costs and a decline in advertising revenue at ESPN. Disney’s $15 billion media rights contract with the NFL kicked in last year, leading to higher costs for ESPN. In October, the company also signed a new, $24 billion deal to air NBA games on ESPN and ABC that will drive up rights costs again in a couple of years.

What you might have missed: Revenue for Disney’s studio entertainment segment dipped 2% in the quarter, to $1.9 billion, because of lower box-office numbers in what was a down year overall for movie-ticket sales. Disney’s quarterly decline came despite a strong performance from Marvel’s Guardians of the Galaxy, which was the second-best grossing film released in 2014. The company said in its earnings release that the segment suffered from a difficult comparison to last year’s first quarter, when Frozen performed well at the box office.

Disney did manage to increase quarterly revenue at its theme parks and resorts by 9%, to $3.9 billion. That’s despite California’s Disneyland making unflattering headlines last month due to a measles outbreak that likely occurred at the end of the first quarter. Iger told CNBC on Tuesday that Disney has “not been able to discern any impact” from the outbreak. Disney is also reportedly delaying the opening of the $5.5 billion Disneyland Shanghai — the company’s first theme park in China — until next year, according to The Wall Street Journal. Iger is expected to shed more light on the timetable for opening the attraction during the company’s earnings call Tuesday evening.

This article originally appeared on Fortune.com.

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