For a long time, my family taught me how to go to school, go to college, and get a good job as an employee of a stable employer. “Be a doctor,” they said. “Be a lawyer,” they said. “Get one with good benefits and a retirement plan,” they demanded. My grandmother was so adamant that I went to a good college, that my graduation from the University of California at Santa Barbara surpassed all of my other accomplishments that I considered much more important than getting my degree.
What’s the obsession with going to college, getting a degree, and getting a steady job? Personally, I think it’s an old school mindset based on fear. The second level of Maslow’s hierarchy of needs addresses the inherent need for human safety and security. In our caveman days, security looked for a cave that would keep the saber-toothed tigers away. Today, it means financial security. You see, in my grandmother’s day, there was very little financial security. She has seen five wars in the United States in her lifetime, the US government unjustly imprisoned her during WWII because she was Japanese-American, suffered the Great Depression of the 1930s, and faced the “Black Monday” stock market crash of 1987. Empathizing with his life, I can see how he would value higher education and a stable job because anything else would be too unstable in his mind. I got my degree and made her happy, but I had no desire to trade my time for money and have someone else be in control of my freedom as well as the amount of money I could earn.
Myth: formal education will lead to greater financial success
I went through university without any intensive study or desire to study. In fact, he was a horrible student in terms of study habits. I credit my college completion only to my innate ability to choose the correct multiple-choice answers based on deductive reasoning and my love of writing research papers. Yet the entire time I was there, I was looking for information that I could take to the streets, practical information that I could put to use – after all, I was paying tens of thousands of dollars for my top-notch education, but I spent my education college with maybe only three classes that really gave me good useful information.
As many college graduates discover, I’ve found that when you leave college, you enter the business world that cares little about education and wants specific marketable business skills. So there I was, diploma in hand, discovering that I was no better than a high school graduate. In fact, it was at a disadvantage relative to those who had entered the workforce immediately after high school because they had worked their way through and developed business experience and skill sets that were appreciated by employers. I felt a bit ripped off because all my life I was told to graduate from college and the money would be there.
The truth may hurt, but things must be clear and that is that in this day and age employees with a four-year degree are a penny a dozen. As an employer right now, I can say that a four-year education tells me that you can read and write well, but little more than that. What I am looking for is experience and practical knowledge. I’m not saying that a four-year education is worthless, but its weight at the professional negotiating table is not as heavy as it once was. Let me put it another way: going to college will make you a good employee, but it doesn’t guarantee wealth.
The employee salary trap
Earning a corporate salary is the biggest obstacle to wealth creation if you choose it as your only vehicle for wealth. That’s because for most of us, our salary is set by our employers and each and every increase is dictated by our employers. In short, we won’t get rich unless our employer says we can. Unfortunately, I have not listed a single employer in my time who has decided to enrich their employees. Having a salary is stable and people like to be stable, but to develop a millionaire mindset, you must stop considering your salary as the only means of income. Being a salaried worker is not a bad thing. You can use the experience to learn and acquire new skills and have a steady stream of income to pay the bills. I’m just saying that you shouldn’t rely solely on your salary if you intend to get rich because at best your employer will only allow you to earn a decent living, not get rich.
Self-employed versus entrepreneur
High-paying private practice physicians, lawyers, and all other similar service professions make a decent living, but they are not what I consider rich just because of their professions. This is because even though their hourly wage is higher than average, their wealth frame is still the same as the gardener making just $ 8.00 per hour, and they are still trading their time for money. .
What is wrong with that? Well, it’s because we only have a limited amount of time per day to monetize. It is true that these professionals have freed themselves from the corporate dictatorship, but they have another problem they face: stopping working is equivalent to having no income. That means if these people are sick, on vacation, or injured, then their entire source of income is depleted because they cannot trade their time for money. This puts enormous pressure on these people to keep busy, which is why I think lawyers are the most nervous people I know. That brings me to this point: being freelance means you are trading time for money, while being a business owner means you are using the power of leverage.
What is leverage?
Business owners are the richest people on the planet, and many of them don’t have any formal college degrees. A good example is Bill Gates, the founder of Microsoft, who is worth roughly $ 25 billion at the time of this writing. He dropped out of Harvard and started his own company. Business owners use the power of leverage, which in this context simply means they get more of their time than an hour than freelancers or employees. In Gates’ case, he developed a computer operating system that he licensed. He strove to create a product that offered a lot of value to his buyers and he benefited immensely from that.
But you don’t need to write get-rich software like Bill Gates. People who buy real estate work with the same passive income model. People who invest do the same. In the services realm, smart service professionals start to hire others to provide the actual services and cut back on profits, thereby creating value for both the service provider and the customer. That is taking advantage of services.
Business owners seek multiple sources of income. Employees believe they have a level of security at their job, but a surprise layoff or layoff could end that security as soon as it is obtained. Worse still, the employee has nothing but unemployment benefits to work with. A business owner may lose one of his sources of income, but he still has others to work with. This is what I consider security: having multiple sources of income.
Take a risk
In my Personal Development sessions, I advise people to face their fears head-on because taking on that challenge makes them grow, both personally and professionally. Entrepreneurs and employees alike have to deal with failure, but smart entrepreneurs aren’t afraid to take that risk, knowing that it will bring them one step closer to success. Be willing to try new ideas and get out of the box. Look for additional ways to earn money and don’t just talk about it – DO IT. That’s one of the most powerful concepts that turns people into millionaires: the ability to act.
While this article only talks briefly about the millionaire mindset, take these key points with you:
* We all have the same amount of time during the day and we can only sell part of our time.
* If you trade your time for money, the best thing you can do is earn a decent living. You will not get rich with this model.
* Find ways to take advantage of what you do to get more of your time and therefore more money.
* Generate passive income through products, software or investment vehicles that produce positive cash flow to create multiple income streams.
* Don’t wait for the perfect moment because it will never happen. Act now, even if your plan isn’t perfect.