The Ultimate Guide to Making Money

Case Study: How martial-arts instructor Johnny tore down his psychological barriers and doubled his rates

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One of the things I teach my Earn1K students is how to consciously recognize barriers — even those that are so deep, they’re invisible to us on first glance. It turns out that our peers — friends, neighbors, even family — can often be significant barriers.

How many of us have had “supportive”  friends and family members tell us we couldn’t earn start earning extra money on the side?

Or that we couldn’t turn our skills and interests into $1,000 a month?

“You’re lucky to have a job right now!” is a common phrase.

But few of these people are living the rich life we want to lead. In fact, if we’re honest, we don’t want to be in their place 10 years from now.

And so many of my students learn to recognize, internalize, and systematically discard these barriers.

Today, I’ve got a story about Johnny, an Earn1K student who suffered a debilitating injury and watched his income drop 50% overnight. With all of his new physical limitations, Johnny knew he couldn’t afford any psychological barriers, too.

He tested his beliefs and was able to eliminate all of his bank fees, start two side businesses, earn thousands of dollars and double his hourly rate from $40 to $80…all before he finished physical therapy.

Here’s how he did it.

“How much would you pay to walk again?”

Johnny was a successful clinical specialist for a medical manufacturer. He had met the girl he was going to marry. And between his martial arts and strength training, he was in great shape.

That’s when his life flipped upside down.

Johnny was squatting 400 lbs. when he accidentally dropped the weight onto his shoulders and blew out a number of discs in his back. Right away, he was bedridden. He also went on extended disability. His income dropped to a fixed $2,500 a month.

“Rent took up 50% of my income,” Johnny recalls. “I live in Vancouver. It’s an expensive city. I’m laying in bed thinking ‘How am I going to pay to eat? How much would I pay to walk again?” You don’t care. You pay what it costs.”

Luckily, Johnny wasn’t loaded up on debt before his injury. But he was quickly moving into the red. “I needed to learn how to manage my money after losing that chunk. I needed to reverse or at least control the descent into the red. I knew I needed some system so I wouldn’t drive myself crazy worrying about every cent.” Physical therapy isn’t cheap. Neither is a wedding.

Johnny picked up a copy of I Will Teach You To Be Rich and was initially taken back. “You’re a cocky motherfucker. You really got in my face, and you asked the questions I didn’t want to ask myself. At first, I wanted to prove you wrong, but you knew what you were talking about.”

“I told the bank what I wanted: $0 in fees.”

Shortly after finishing the book, Johnny started walking again. Between physical therapy sessions, one of the first places he walked to was his bank.

“From reading the book, I immediately experienced a couple of mental shifts. One was paying for what you love and being ruthless about what you don’t. I went over my banking statements for the past three months and realized I had been getting hit with a lot of fees. Who wants those? So I went to a new bank and told them what I wanted: $0 in fees. They set up my account so I had no fees and actually gave me $250 to switch banks.”

Impressed that Johnny could demand — and get — that from his bank, his fiancee went into her bank and did the same thing. Johnny told his friends and they agreed — “I shouldn’t be paying for this.” They walked into their banks and negotiated down to $0 in fees.

“It’s like breaking a world record,” Johnny laughs. “First one person does it, then everyone does. It’s just a psychological barrier.”

From managing money to making money

After seeing the results from the book, Johnny knew the next step was Earn1K.

“I needed to find a way to compensate for my fixed income. At that point, though, I didn’t really know what I’d be doing. The results from your book were so great that I had an attitude change about pursuing opportunities. I wanted a further psychology shift. I figured if your book had that much of an impact, I knew the course would probably be exponentially more so.”

Johnny signed up and devoted 10 hours a week to completing the activities in each lesson.

“Once I found my ideal clients, I didn’t have to explain my rates.”

While working through the course, Johnny settled on martial arts training as his business idea. He had over 25 years of martial arts experience, and he could do it while continuing with his physical therapy.

“Plus, a lot of what I teach is psychological. Most martial arts training is all physical. It’s action, reaction. You repeat something 1,000 times so that you can respond that way instinctively when you’re in the moment. But that’s not the best way to create behavior change. I mean, how many times do you have to practice touching a hot stove before you learn not to do that?”

Johnny knew that he could teach people a martial art the same way Earn1K taught him how to earn money on the side — by setting up systems to drive behavioral change.

After some free training proved the marketability of his idea, he started coaching novices at $40 an hour.

In hindsight, that was a mistake. Johnny struggled getting novices to pay. And when he did, they treated martial arts more as a novelty than a serious pursuit and didn’t stick around. “They wanted everything for nothing.”

This is where most novices fail. They randomly pick a price and, when the price doesn’t produce paying customers, they thrash around, creating Facebook pages, Twitter accounts, and blaming the economy. They rarely stop to consider that they didn’t do their homework — usually involving pricing research and choosing the right clients.

Johnny was convinced there was a market for his martial arts training, but what if he was targeting the wrong people? He reviewed Earn1K’s 37-minute video and worksheet on how to define your target market. One lesson that resonated with him was to market to people who were willing to pay for value.

“That’s when I noticed more and more experienced martial artists were gravitating toward me. I found I could help these people target a narrow gap in their skill set. They already knew instruction could move them to the next rung up the ladder. Plus, they already understood what I was doing and appreciated it. That meant I didn’t really need to explain my rates.”

To prove it to himself, he tested raising his rates from $40 an hour to $80 an hour. No one complained.

It sounds simple, but the application of choosing the right clients is subtle.

“When you start out, your beliefs about who your customers are and what they will pay for your service are just that. Beliefs. They’re internal. They’re limiting. You have to find out who your ideal customer really is and then test to see what it’s really worth to them.”

“I always hear your voice in my head.”

A year and a half ago, Johnny was a on a fixed-income slide into debt.

Today, he’s growing a profitable martial arts business and feels more in control of his financial future than he ever has. He’s ramping up to earning $1,000 a month from his coaching and recently added a new income stream selling martial arts training equipment on Craigslist. Plus, this new income stream has become his best lead generation tool. “I’m actually making money on my marketing, not just spending.”

Nearing the end of his physical therapy, Johnny looks forward to what’s next. “I’ve also used my business, sales and martial arts experience to branch out into event security and management. I sell the clients. I build the team. I do the site assessment. Then I send in my team to actually work the event.”

Johnny credits his new found skills and confidence to Earn1K. “The course helped me be honest about what was working and what wasn’t. I always hear your voice in my head. Your like my conscience. I can hear you saying ‘Did this really take you where you wanted?’”

For Johnny, the answer is yes.

Total earned using Earn1K: $3,500.00

Hourly rate: “My starting rate was a straight $20/hour. I have now developed a number of rungs where the first is a $10.00 no commitment, group drop-in. Assessment occurs here. The second rung is a 4 part modular program that is taught at $200 per program participant. The 3rd rung is specialization or personal training building on prior concepts learned. This rate ranges from $50-$100 per hour.”

What you would be doing without Earn1K: “It is possible that I would still just be talking about doing it! I would lack confidence in my business dealings, learning through costly trial and error on multiple levels. I would not have been as focused in my clientele and been pandering to the lowest common denominator.”

What you would tell others considering joining the course: “Take the course if you want to change how you see business, save time and money and understand when you are being manipulated in other systems. I see Earn1K as freelancer self-defence course. Applicable and effective for a specific outcome. I have gained better marketing insight than people with 4 years of schooling in similar fields.”

Read the same chapter that helped Johnny tear down his mental barriers — for free

In the opening of my book, I break down the key messages of I Will Teach You To Be Rich

  • Why getting started is more important than becoming an expert
  • How to get extraordinary results
  • How to spend extravagantly on the things you love
  • And much more

You can get this chapter – for free – by signing up below:

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7 Comments

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  1. Way to go, Johnny! Anyone can sit around and say they’re going to do something, or complain about how life is so unfair, but you did the most important thing: you actually got off your ass and did something.

    The more I talk to people about personal successes, the more I’m surprised how few people actually take steps to succeed.

    To anyone reading this right now and saying “Why not me” and then not doing anything further, you’ve already failed. Ramit has laid out great tips (for FREE on this blog, you have no excuses.

    Keep kicking ass, Johnny!

  2. Johnny, congrats. Can you please tell me if the bank you and your fiancee used is in BC? I’m in Quebec and wonder if there’s a huge difference between fees / no fees between the two provinces…ie Quebec can be vastly different in laws and practices from the rest of the country. Same is true between US banks and Canadian.

    • I switched from CIBC to TD Canada Trust. My wife worked out a no fee deal at RBC. We both maintain ING accounts as well.

      When my wife went in she specified she wanted NO FEES, and had them structuring her banking so no fees would be the result. At one point the bank officer said, ” It’s only five dollars per month.”
      My wife replied “then you won’t mind paying it, since I want NO BANKING FEES.”

      If you present the bank employees with the outcome you want to achieve they can become surprisingly creative.

  3. This is one of my favorite case studies yet, especially how he branched into security and selling equipment–which also brought in new clients.

    I sometimes feel like Ramit is my conscience for certain aspects of my life, too. I often ask myself-What Would Ramit Do?

    WWRD: my financial credo

  4. This is an awesome case study. I’m actually getting kinda sick hearing stories about how people earn income on the side doing graphic design or SEO. And I love hearing these stories about how non-technie people are able to earn extra income. Great plan Johnny, keep diversifying your products and testing different income streams!

    And I would love to hear an update from some of the past case studies you’ve posted Ramit!

  5. Same as WWTDD – Tyler Durden :-D

    This study rocks.. ! After waiting for almost 3 years with no pay hike [not an employee, am a contractor with another outsourced company] – I have decided to move on… to 20% increase. Thrilled !

  6. This is fantastic! It’s always inspiring to see someone doing these things, and to see what obstacles they faced along the way–it normalizes the real and imagined struggles we all face.

    I recently upped my rate for some of the same reasons, since I know the value I provide is well worth my going rate. So far, I’ve had no complaints.

    The Earn1k and IWT paradigm is great for re-examining your beliefs and habits, and kicking yourself out of them–testing & evaluating along the way, of course.