The roads to building wealth
In this post I will describe a sure fire way to building wealth, guaranteed not to fail, providing you follow my instructions exactly. If you want clearer instructions, send me $1000 in bitcoin, and I will provide you with a video on how to build wealth. Message me, and I will provide you with hundreds of references from my now independently wealthy clients. Anyone who has common sense knows that these types of systems do not work, there is no sure-fire way to becoming wealthy. But you can increase your chances of becoming wealthy. Let’s look at the three roads to building wealth.
An idea or object doesn’t exist in our consciousness till a word is created for it. You might experience the effects of this idea or object, you might subconsciously know it is there but it doesn’t exist till it has a name. An example of this is gravity until Sir Issac Newton invented the term gravity it didn’t exist in our consciousness. Gravity is something which affects every living being but people didn’t know the effects of gravity till Newton invented a term for it. Once a term has been invented for something, it seems obvious. Once a term for gravity was invented, we could do all sorts of things, calculate how far cannonballs would fly out of cannons to launching spacecraft.
Someone recommended on Reddit that the book, The Millionaire Fastlane was a good book to read. Despite its hokey title and cover, I decided to read it. The book is poorly written, rambles on in places, it feels like he does this to create enough material to justify a book. But it does have many good ideas which I will cover in this post coupled with my own experiences. Half of the book is where he describes the three roads to wealth. The book brought about awareness of ideas which I did not consciously know existed. Lets look at the three paths to wealth.
Poorness - the sidewalk
This describes a great deal of the population, they live from paycheque from paycheque, they have zero savings, they are usually in debt. They will spend their money or go into debt to spend their money on glamorous things that have no value. They are of the opinion that getting wealthy is largely a matter of luck or there must be some secret. Usually, they fall victim to every Multilevel Marketing Scam out there and would probably send me $1000 for my sure fire method to gain wealth.
The people on this path always need the latest iPhone X, then they will be boasting on how it has a new type of headphone jack. Of course, to buy this new iPhone X, they used credit. Banks and stores love these types of people. Many retail shops make more money on providing credit than actually selling the item. The retail shop can borrow the money at close to the prime rate, they then lend out the money at 15% for 2 years. As an added bonus, the retail shop has a guaranteed income for the two years. There is nothing wrong with buying the new iPhone X or flashy clothes, providing you are spending money you have. The new iPhone X does not create wealth. With your old iPhone, you to call people and send SMS just as well as the new iPhone X.
Of course, if you ask the person on this road, did they read a book or a blog. They will tell you they don’t have money to buy books or time to read a blog. They have no interest in attempting to better their situation. Their priorities are messed up, lots of money for iPhone X, no money for important things. Substitute iPhone X for a designer purse, clothes, watch, automobile etc. Instead of looking at functionality, they are looking at impressing people with fancy things. The next road is the one which your school guidance counselor recommended and possibly your parents. My parents always pointed out the importance of saving money and security, this is the road they recommended. Not to say, my parents, where stupid, no one told them differently.
Mediocrity–The Slowlane
This is the 1950’s dream, go to college or university, get a degree then work for a good company until 65 and retire. Your teachers and guidance counselors recommended the same thing because they are stuck on this road. The premise is you save X dollar a month, the company you work for offers a good pension by 65 you should be set. The 1950’s companies no longer exist, due to globalization, the security is an illusion. Even the military in many countries is no longer a secure option. The military is outsourcing and they are cutting pensions. Inevitably if you are graduating school, this will be the lane you will have to start in but as soon as possible, look for opportunities to switch to a faster lane.
Personally, if you have the opportunity, get a higher education. Knowledge is always useful, just be aware of the limitations. When you are working in the slow lane, the skills you learn are what is good for the company, not what is good for you. This skills you learn are ones which are applicable to company’s policies. If you work for Starbucks making coffee, you learn how to make coffee in a way that is best for Starbucks. If you get a job elsewhere, these skills are non-transferable. Except for certain types of jobs, like sales, this is usually the case. Often the best salesmen started out selling used cars or insurance, selling/marketing is a transferable skill.
Working for someone else, you essentially exchanging your time for money. Money earned equals your intrinsic value multiplied by hours worked. To earn more money, you either work more hours or increase your intrinsic value. For many jobs your intrinsic value is essentially locked, even if you are the best teacher in the country or the best coffee maker at Starbucks, you will still earn the same amount of money. The best you can hope for is some plaque at the Christmas party. There are exceptions to this, usually sales and people who are good at playing company politics. If you are a good salesman, you are in a bargaining position. If you are good at company politics, maybe you could work your way up the corporate ladder. Usually, the company works using implied promises which often use implied security. The company wants as few employees as possible with intrinsic value so they are not in a bargaining position.
The slow lane isn’t a bad lane for everyone, providing you can get a career which has a high intrinsic value. A heart surgeon, good plastic surgeon etc are careers with a high intrinsic value. If you are good at this profession, people do not care what your political values or beliefs are, just as look as you can save their life or make them look good. I saw some cream made of the placenta, or basically after birth. Allegedly, this cream rejuvenates the skin and makes you look 20 years younger. Anyone who is willing to rub afterbirth all over themselves probably isn’t too worried about using a plastic surgeon who is politically incorrect. For normal people like myself, I lack the ability or skills to get this type of career. So what is the other option?
The fast lane
The amount of wealth you have is dependent on your disposable income. A person who makes $2,000 a month but has $1,000 a month expense has a greater disposable income than a person who makes $10,000 a month but has $9,000 a month expense. The second important factor is how many hours per a week you are working. If you need to work 100 hours a week, this will not give you much time for leisure. As you probably figured out, the fast lane involves starting your own business. Conventional wisdom states that starting your own business is risky, 80% of new businesses fail within 5 years. I will address this in my next post. Lets look at the advantages of starting your own business.
You are in control of more variables
In the slow lane, you could only control two variables, the time you worked and your intrinsic value. This meant you didn’t have much bargaining power when it came to earning more money. You could either work more hours or attempt to increase your intrinsic value. With your own business, you control a greater number of variables. The more variables you control, the better your bargaining position. If you decide to sell hamburgers, you control an infinite amount of variables. For an exercise, let’s look at the variables you control.
price - you decide how much you want to sell the burgers for. You could sell cheaper than McD and offer a lower quality burger or more expensive and a higher quality burger.
the burger itself - this ranges from the size, and type of bun, the size, and type of meat used inside the burger. What type of dressings go inside the burger.
where you will sell the burgers - the physical locations where you plan to sell the burgers. This could be a certain physical location to selling on-line.
type of establishment used to sell burgers - this can range from a vendor’s cart to selling the burgers in a five-star establishment.
your suppliers - this ranges from the physical location of the supplier to what you want to buy. For example, you could decide to buy wheat directly from a farmer and grind it yourself into flour and make into buns. The same with the meat, buy cows directly from a farmer to using premade hamburger patties.
Honestly, I do not know much about burgers except for eating them. I know lots of other people like to eat burgers which indicate there is a market for burgers. Since you can change an infinite number of variables, you can decide what part of the market you want to cater to. Also, the is the possibly of combining burgers with another product. Certain types of products have more variables than others. This is why farmers who produce things like rice, wheat, sugar cane etc do not make much profit. There are fewer variables which can be changed. All sugar is sucrose, whether it comes from sugar cane or sugar beets doesn’t matter. You can only compete on price. It was just a mental exercise, I strongly advice, do not open a burger place unless you know about burgers.
The skills you learn will benefit you
Even if you setup a simple burger stand, you will learn many skills which benefit you and can be reused if your burger stand fails or you decide to set up another venture. These are skills which you will not learn working from someone else. To set up a burger stand, you will need to get a business license, food permits etc. You will need to learn basic accounting skills, how to do inventory, file business taxes etc. Each of these skills can be applied to other ventures. By contrast, when you work for someone else, most of the skills you learn benefit your employer as opposed to you.
It is always the unexpected problems which will cause you to fail. You might argue that you should have expected these problems, if you could have predicted them, they would not be unexpected. You will learn how to find information and apply it to solving these types of problems, this is something you won’t learn working for someone else. Common unexpected problems are usually accounting and taxes, the bookkeeper you hired wasn’t filing properly, you then need to go down to the tax department and negotiate. It is always lack of information, which is the small details, which screw you up. You then need to figure out a solution.
The secret is in figuring out how to scale your business
The difference between your average burger stand and McDonalds is McDonalds has figured out how to scale. How to replicate thousands of burger shops that provide the same experience for their customers everywhere. Most people when they set up a business are contractors, essentially they are employees who are exchanging time for money. Initially, when you start your business, you will be exchanging time for money. Unfortunately, most businesses never get past this point. Before your business can scale, you need a successful business to start with. You then need to develop a system so your business can scale. This system is what differentiates Starbucks, McDonalds etc from a normal coffee shop or burger stand. It is this possibly which gives you the ability to increase your wealth greatly.
The secret is reoccurring income
If you scale your business using a franchise model, the reoccurring income comes selling products to the people who bought your franchise. This is a reoccurring income. You are able to do this because you can control more variable as I discussed earlier. Amazon originally started out as an on-line vendor selling books. They then allowed other sellers to use their platform to sell their products, this is a reoccurring income with a limited added expense to themselves. This is a form of reoccurring income.
There are more obvious methods of generating reoccurring income, of course, it comes with greater difficulty. Creating a book, video etc is a form of reoccurring income. Once the book has been created, if people like the book, you can potentially sell copies of the book in the future. The cost of creating the book is fixed while their potential returns on the book are infinite. Of course creating a book which people will buy is extremely difficult, I am just using it as an example. I have given reasons why you should start your own business, it is good to look at reasons why people don’t start their own business.
There is no magic bullet, There is no magic bullet
Most people are willing to put in the effort but they want guaranteed results. They also do not want to think too much. On one of my previous posts The manosphere is in the process of forging a new male identity a reader made these comments:
These long theory posts tell me nothing about approaching, sexual strategy and the like. They are filled with generalizations and they fail to address sexual strategy.
Do you (weight) lift? Approach? I don’t get these posts.
I am asking you if you approach, if you lift or if you just theorize.
Yeah but it is just a bunch of massive generalizations that tell us nothing about sexual strategy for men.
I quoted the readers comments since he does have a valid point. Possibly he is a younger male reader, the parts of his young male brain that regulate sexual desire are three times as large as a female. He wants to know how he can get laid. I am not politically correct, when I was his age, that is all I could think of. In fairness, he is willing to put in the effort but he wants a magic system, I thought the same thing when I was his age. Here are the facts.
The less she has been drinking, the more likely he is to experience about 150 risks of rejection between eye contact and intercourse. And, of course, the 150 risks of rejection are more likely to be experienced if the woman is one of the 40 percents who says “no” when she means “yes.” Does Feminism Discriminate Against Men?: A Debate
Whether or not the figure of 150 is accurate is irrelevant. The point is on average, the man has to approach the woman many times and most of the time he will be rejected. The reader wants a magic bullet or system, like what he learned in school. The teacher gives you a math problem, 3 times X plus 22 equals 155. The teach previously showed you a method to solve similar problems. You then use this method to solve for X. If you work for someone else, your boss will give you similar problems. Unfortunately, this doesn’t work when for most problems in the real world.
How is the problem of our young male reader getting laid similar to running a business? In both cases there are rules or laws in what you are not allowed to do, there are not rules or laws on what you should do. So our younger reader getting laid, the are laws he should not rape the woman and in some jurisdictions, he should not resort to prostitution. Other primates have similar rules, male chimpanzees that are caught raping female chimpanzees are usually beaten up by a gang of angry female chimpanzees. So even if you are a male chimpanzee, it is advisable to follow the rules, unless you want your head smashed in with a rock.
Atleast our young reader has clued in that the better his product is, the less likely he will be rejected when he approaches women for sex. So he is asking about weight lifting, obviously, a man who is fit will be less likely to get rejected then one who is four hundred pounds. Tall men are less likely to be rejected then, short men. This is the reality its The way things are, and the way they ought to be, most people need shit to escape reality, life is not fair, get over it. When you are starting out your business, you are running at a disadvantage, you are the guy who is five feet tall. For practical purposes, you can not change your height but you can change other variables. What variables can or should you change?
There are no fixed answers. The only way to figure out is by trial and error. That means approaching women, getting rejected and then learning from your errors. Many times the variables you can change are not obvious, for example, if our young reader is five feet tall, he could increase his chances of success by moving to a place where the average height is four and a half feet tall, that is a variable he could change. Then he would be a tall man. This was the purpose behind my post Finding better solutions by thinking inside the box, a method of trying to figure out what variables you can change.
Whether you are starting a business or learning how to get laid, expect lots of failure and rejection. It is part of the learning process. My next post will be on how to limit the costs of this failure and rejection. There is no magic bullet, I repeat again, there is no magic bullet. Your failures will be something you have to suffer alone and learn from.
You are going to have to do this by yourself
One of the biggest mistakes one can make is getting a business partner. People usually have the wrong motives when they get a business partner, they want to avoid failure by themselves. What usually happens is when things go wrong, instead of fixing problems, each partner will attempt to transfer blame. There will also be disagreements about how the work should be split. Finally, there will be disagreements about the directions the business will take.
An extreme example is small business cooperatives, example, a group of carpenters get together to open a furniture manufacturing business. Each of the carpenters is a craftsman and talented, yet the cooperative often fails or doesn’t reach its full potential. One of the carpenters’ researches and finds out there is a market for religious icon tables. Instead of being able to right away making a religious icon table, he will spend most of his time convincing the other carpenters in the coop it is a good idea. If the idea fails, the rest of the carpenters will say what a stupid idea it was. The one advantage a small business has is its ability to change direction quickly, with a business partner you lose this advantage. The more business partners you have, the more you will lose this advantage. Note, there is a difference between a business partner and an investor.
Human beings are herd animals, similar to cows or sheep. When a wolf approaches, all the sheep huddle together. Humans like to think they are smarter then sheep, one of the most difficult jobs of an infantry Sergeant is training recruits not to cluster together. Modern weapons like hand grenades, mortar rounds, and artillery shells are proximity weapons. A hand grenade has an effective casualty radius of 15 yards, that means if an infantry squad of 8 men is huddled in a circle of with a radius 5 yards, one grenade kills them all. This is driven into the recruit’s head repeatedly keep a 10-yard spacing, even in training exercises, the moment he comes under fire, he instinctively moves closer to his buddies. Even with trained soldiers, if you are tired, in a dangerous situation, you instinctively want to get close to your buddies. If possible, avoid making decisions when tired, your primitive brain starts to take over then. The job of the Sergant is to ensure your primitive brain isn’t running things, in this case
The Sergeant has to ensure proper spacing is kept.
So expect lots of sleepless nights trying to figure out problems, by yourself, like how to pay suppliers, how to increase sales etc. This is something you will have to face alone. This doesn’t mean you should not ask others for advice, just remember you will be ultimately responsible for the decision of using this advice. You are by yourself, you have to accept that. Of course, if you are successful, expect lots of people saying they always believed in you, you where lucky etc.
You are not going to have your dream job
The Gambino family back in Italy didn’t say, let’s all migrate to New York City and get our dream job monopolizing the garbage collection of New York City. Even in the criminal world, there are jobs which others do not want to do. With this family, they go into elimination, removal, and cleanup of bodies. It’s not glamorous like owning a night club selling illegal alcoholic beverages. To dispose of these bodies, this mafia family figured out a garbage cart and later a garbage truck was useful.
As a secondary benefit, they decided to use the garbage cart to help people dispose of their garbage. This mafia family identified a need, people have garage they want to dispose of, this garbage truck when it isn’t being used to dispose of bodies it can be used to dispose of garbage. After a while, their business of disposing of garbage was more profitable than making people disappear. Making people disappear is also a high-risk occupation, the is the potential of death, incarceration etc. Eventually, they had a whole fleet of garbage trucks and they got out of the body removal, cleanup, and disposal business.
I am not advocating one should do criminal activities, the point is, your business needs to satisfy the needs of your potential consumers. The type of business you open is dependent on your abilities. For the Gambino family who migrated from Italy, their skills were limited. Lack of education, inability to speak English etc. limited their business opportunities but they identified a need. Then using their limited skills, they satisfied their customer’s needs.
When I did on-line marketing years ago, a Catholic priest asked me what I did. It was difficult to question to answer, since more people didn’t know what on-line marketing was at the time. I then turned to the priest and said, Father, I sell people useless stuff they do not need. The priest then asked how do I do this? I told him, Father I satisfy people’s wants by using the Internet and selling them useless garbage. The Catholic priest then broke out laughing and said, you are one of the most honest people I met in a long time.
Most people are inherently stuck in the sidewalk road, they believe that material things can satisfy their wants. Your job is to satisfy people’s wants with the best possible product or service at the best possible price. Myself, my needs are fairly small, enough food every day, a bed to sleep in and a roof over my head. My needs and wants are not the same as the needs and wants of my consumers. Your business needs to satisfy the needs and wants of your consumers, not your needs and wants.
Further directions
There are no magic bullets, I repeat again, there are no magic bullets. Look around and start identifying needs or wants of people and how you can satisfy them. Be prepared for lots of failure and disappointment in trying to satisfy these needs and wants. The only way you can learn how to do this is by experience. Experience only comes from learning how to overcome failure.
Before you run out and start your business, wait till my next post. It will deal with how to start up your business and minimize the catastrophic effects of failure. I am an expert in failure, failure itself isn’t bad, providing you learn from it. The key is to avoid catastrophic failure, which means if you get yourself in sticky situations figuring a way how to extract yourself with a minimum of damage. In this post, I gave the reasons why one should not have a business partner, I learned that the hard way. Income tax and accounting problems, again I learned that the hard way.
With the income tax problem, I thought my accountant and business partner where filing the taxes correctly. To my shock, I found out several years later, they where not, I received a summons from the tax department. I then right away went to them, I told them ignorance of the law is not an excuse but I believed I everything was being filed correctly. When the tax department saw I was willing to cooperate 100%, we where able to work out a deal where I would pay them what I owed with a minimum of fines. I was extremely fortunate. Ultimately, I was responsible, I should have learned to the procedures work and ensured they where being followed correctly. Point is, learn from my mistakes.
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