Until a year ago, I was persuaded that you had to either be an employee or an employer. And in order to be an employer, you had to be an employee first for at least a few years. Then you would still work like a donkey, sleep a few hours per night and grow your belly faster than your business. I didn’t think there was a way to be both rich AND happy.
Spoiler alert: I am far from being rich at the time of writing, but what I am about to share with you are the words of multi-millionaires.
Money is an illusion
As soon as you understand that, your whole world is going to change. Ask yourself this one question: why do you want more money?
Some people will say “I need more money so I can travel more”, “to be able to quit my job” or simply “to enjoy life more”.
All these are valid reasons, the only issue is that you only think of money as a way to get them done. There are many ways you can use to travel for little money, there are probably tons of other jobs you could do instead of your current one, and you can enjoy life better just by choosing who you spend your precious time with.
However, if you are like me, you probably want both money and happiness.
When it comes to happiness, every single person has a different definition. But for this article’s sake, here is a definition I personally think applies to the vast majority of us: Happiness = Reality – Expectations.
Have you ever wondered why so many rich people are so sad and so many less fortunate people are smiling every day? It is probably because the rich are not satisfied with what they already have and want more, and the less fortunate are not expecting anything more from life and are grateful for what they have.
Another big difference is that the less fortunate know the pain of lacking things that you need. Therefore they are more generous than the rich and happier because helping others is a great source of happiness!
So my advice is, remember the less fortunate when you feel unhappy and never let money corrupt your mind and ethics.
That said, here are actionable steps to help you grow your income and be financially free.
Your single most important asset
Is your brain.
Have you ever wondered why most people winning at the lottery end up where they were before winning? Or why some companies collapse after they have been inherited by the owner’s child?
Money comes en goes, and it usually is easier to make it go than come.
However knowledge comes and stays! And when some knowledge can be directly related to money, well you guessed it… Money comes and stays.
At the time of writing, I am just about to finish Robert Kiyosaki’s “Rich Dad Poor Dad” book.
Although I (strongly) don’t agree with him saying that Donald Trump is a hero and a genius, I can still keep an open mind and admit his financial advice is valid.
The main point of this book is to say “If you want to make more money without working more, acquire more assets”. That’s it. However, you need to know what an asset is first (you can search for it on YouTube).
I wouldn’t have thought about this in such a simple and structured way if I hadn’t read his book. And that is the point of this section: keep learning!
Most people think learning is only done at school and college and then stops when you begin to work. However if you want to get ahead, never stop learning. You can read books (I will recommend some a few lines later), watch YouTube videos, read online articles (like this one), follow online courses (free and paid), …
The possibilities are endless.
One simple idea, endless possibilities
More assets, less liabilities.
As simple as that.
I like Robert’s definition of assets and liabilities “assets generate money and liabilities take money out of your pocket”.
With this definition, your personal house, a car or a mortgage are liabilities. Why? Because they create a cash flow that goes from your pocket to energy companies (bills, gas, …), taxes, the bank, …
Imagine you want a brand new car (a liability). Your first instinct might be to take a loan, buy the car and then repay the loan over the next 2 to 5 years.
The issue with this approach is that you need to create a cut in your existing income source (probably your salary) to be able to repay that loan. And even after you paid it in full, the car’s value has deprecated drastically so you can only resell it for a fraction of its original price.
Here is another approach.
You could buy / create assets that will generate enough money to pay for that car you want. Instead of using the loan to directly buy the car, why not invest the money in real estate, create a self sustaining business or invest in another business (buy shares)?
These assets will not only generate money to buy your new car, but they will keep generating extra income in the future! And all of this without touching your existing income!
Some assets you could start investing in right now:
- Trade in the stock market (I personally don’t like this approach as it does not create value for anyone).
- Peer to peer landing.
- Create a business (online or offline).
- Invest in real estate (buy, sell, rent).
- Build a personal brand online (get a decent following on any social media platform).
- Write a book and share your specialised knowledge.
- Build an app and sell it on the app store (or create in-app purchases).
- Invent something new, patent it and sell the patent to companies to produce and commercialise.
And the list could go on and on… You should ideally find something that you are passionate about (i.e. Are you a designer? Then check out how to put your art on clothes and sell it!).
Ready to be rich and happy?
Good! Then you got the following principles to help you get better emotionally and financially:
- Spend more money in assets, less in liabilities.
- Be grateful for what you have, yet seek what you want.
- Give back to your community without expecting anything in return.
- Create value adding assets (you will have a greater impact on this world creating a compostable cutlery business rather than buying and selling virtual stocks).
If you only follow these 4 steps, you will grow wiser, happier and wealthier than ever before!