The challenge for all of us is to learn what we have not been taught in regard to money and to overcome what we have been taught that was flawed. Flawed because it was mixed with error, or because it did not take our personality into account. The biggest error in my opinion: the process of becoming rich. Understand that a desire to become “rich” betrays a misunderstanding of financial goals. Your life is “rich” when you have family, friends, and intangibles that bring you joy. Those intangibles “en-rich” your life. What you are talking about in relation to money is “wealth.”
The most often missed character trait or personality trait not accounted for: your comfort with and desire to work. Hopefully, you have understood that you cannot become wealthy through “work.” The term “work” for many connotes time each day at a job. The job becomes the preoccupation, and the work ethic becomes the claim toward financial health. Some even say: I want to get a good job so that I can be financially secure. But, that fallacy doesn’t address the personality question. Switch “work” to “effort.” Wealth development involves effort. The personality question involves investing that effort in areas that you maintain because they fit naturally with who you are.
With the oft-cited errors and your personality in mind, I want to suggest 3 considerations as you wake up to your financial opportunity. Financial literacy is about knowing what more of your options are. Relearn what you have been mis-educated to believe. Filter the new knowledge through your values and personality. Then, apply effort liberally until you reach your financial goals.
Wealth is about what you do with what you have. Figure out what you have per month by completing a 12-month budget. You don’t have to wait before you begin to make the investments that turn your financial tide. Actually, your time, relationship, and learning investments right now are setting you up for either success or failure. Reading this is a mark in the success column. (Subscribing is even better!) Even $48 per month puts you in a position to make tremendous wealth gains. I would focus on learning how to invest that $48. I wrote some help.
I have a number of young clients who have graduated from a baccalaureate program and wonder if they should go back to school. My most adamant advice goes to those who consider returning for a graduate education because they believe they can get a better job, make more money, and finally get to a point where they can invest.
Never enroll in a degree program, especially a professional degree, to make investment money. Getting a degree means that you are going to have to WORK. You have to decide if that even fits with your lifestyle goals. Your financial journey will require effort and capital, but don’t mix that up with work. You are no use to your financial success if you are too worn out to enjoy its rewards. Over 90% of my clients don’t actually want to work. They see it as a necessary evil. Some 70% or more don’t like their jobs or don’t enjoy an integral component of their jobs. But, that’s okay. You want your money to work. You want to spend your time being a workforce agency for your money.
Contrary to popular belief, not every rich person has a product to sell. That statement is a partial lie. Every rich person in the Real Economy has a product to sell. Wealthy people in the Imaginary Economy (financial markets) are sold on a product. You can get into the Real Economy by selling shoes, shirts, scrubs or other things that people need. You can invest in a franchise and leverage the set of products that the franchise has already branded. In the financial markets, you will need to review options and create a strategy for investment (stock buys), profit taking (sale of assets), wealth building (long-term investments), and legacy (insurance and survivorship arrangements like trusts). Understand the process and economy that fits with your lifestyle goals.
The primary question everyone seems to forget is: Do you want to work? If yes, How do you want to work? If no, How will your money work for you? Consider the following decision tree:
Wealth Building Decision Tree
|Do you want to work?|
|Yes. (Working)||No (Investing)|
|How do you want to work?||How will your money work for you?|
|Service||Product||Public Stocks||Private Equity|
|Do you want to advance in the career?||What level do you desire?||Determine your freedom number (amount).||Choose a growth sector and viable private company for investing.|
|Yes||No||Grunt||Manager||Owner||Manage investments for the greatest return.||Influence the company’s brand for highest yield.|
|Map the path of smart work not over committing to the company.||Be a grunt. Leave your work at work. Use the money to invest.||Be a grunt. Leave your work at work. Use the money to invest.||Map the path of smart work not over committing to the company.||Manage revenues for the sustainability of the business. Invest profits.||Manage until you reach your freedom number (amount).||Sell the company or take the company public.|
|Advance until you either are CEO or have successfully bought out your time.||Work until you have accrued enough investment return and no longer enjoy the work.||Work until you have accrued enough investment return and no longer enjoy the work.||Advance until you either are CEO or have successfully bought out your time.||Use profits to hire managers thereby buying out your time.||Financial plan for sustainable return to fit your lifestyle goals.||Financial plan for sustainable return to fit your lifestyle goals.|
Consider financial planning, education, and wealth when you consider your financial goals. Match the opportunities to your personality. Make the decisions that fit for the lifestyle you want to earn. You will apply effort. It’s up to you whether you work.