8 Ways to Make Money
Ways to Make Money
Are you looking at ways to make money, become wealthy, and achieve financial freedom? Inspired by a thought-provocative list published by Financial Planner David Bach (author of the Automatic millionaire), I share my updated version: 8 Ways to become wealthy! Spoiler ALERT: only THREE of them TRULY work!
1) Inherit it | Ways to Make Money
This is how a small group of families amassed their wealth for centuries. The original wealth is passed down to succeeding generations out of business or power. Undoubtedly, the easiest and fastest way to acquire wealth is to inherit it. Clearly, inheriting wealth is mainly a matter of blood; Warren Buffett calls it “the ovarian lottery.” You have to be born into the “right” family. If you want my take on that, this approach is NOT even worth considering for several reasons:
A) There is something sad or even sick about thinking about the money you can get from your parents when they die. It is even an unreliable plan. For instance, if your parents think like Warren Buffett, they might leave you with “enough money so that YOU would feel YOU could do anything, but not so much that YOU could do nothing.” Some parents go wild and plan to spend all their money before their last breath! Others get seriously sick and unlucky and must spend much of their wealth supporting their “golden years.”
B) There is a school of thought ready to report undeniable evidence that generational wealth is lost in a few generations. A groundbreaking 20-year study conducted by wealth consultancy Williams Group involved over 3,200 families. Seven in 10 families tend to lose their fortune by the second generation, while nine in 10 lose it by the third generation.
C) There is another school of thought that reports very low social mobility and that wealth is simply “protected” and transferred among rich people. Therefore, the rich stay rich, and the poor remain poor unless we don’t strongly intervene in Redistribution Politics. We can enter into political or sociological analysis and discuss and implement a 10-year plan to change society. It is your choice. In the meantime, if you want to take control of your financial future, what can you do?
My bottom line is that inheritance is out of your control. If you have one, take it. Otherwise, move on and forget about it!
2) Marry it | Ways to Make Money
If you can’t inherit it, the second easiest and fastest way to acquire wealth seems to marry someone already wealthy. And sometimes, that person may even be kind, generous, compatible, and loveable. And, if not, divorce can pay off handsomely. However, do you need a moralistic speech? Let’s rely on the famous saying: people who marry for money generally pay for it in one way or another. So, forget about it unless you genuinely fall in love with a wealthy person!
3) Win it| Ways to Make Money
If you can’t inherit wealth, can’t marry it, then you can win it. Lotteries abound, paying out multi-million dollar jackpots; eventually, someone always wins them. And remember the slogan: you can’t win unless you play. Unfortunately, you have a greater chance of being struck by lightning than winning the lottery. Now let me ask you something else. Have you ever won the lottery? Do you know anyone who has won? Exactly. If you need extra motivation to move on, remember that most lottery wins are highly taxed, and paid over several years.
While the ultimate amount you get in your pocket is strongly sliced, the final blow comes from the classic behavior of the lucky winners: they mismanage the money, spend it in crazy ways, and end up worse off in a few years. You might still dream of the “crazy expenditures,” but forget about ending up wealthy and financially free! So, forget about it!
4) Steal it| Ways to Make Money
If you can’t inherit wealth, you can’t marry it, or win it then you could steal it. You could “cook the books,” steal millions of dollars, buy a 20 million dollar home, lie to the feds, and hope you don’t get caught or convicted. I don’t recommend anyone try to get rich this way. It’s not a legal (or moral) way to get rich. Technically, the risk-reward is not favorable in the long run. Forget about it!
5) Sue for it| Ways to Make Money
This one is huge these days. More than three-quarters of the world’s lawyers practice in the United States, and upwards of 94 percent of the world’s lawsuits are filed here. It seems some people feel that rather than earn, save, and invest. A better strategy is to find ’em, sue ’em, and sock it to ’em. In any case, it’s not a real system that can be counted on to build wealth. So, forget about it!
6) Save it| Ways to Make Money
You can track every dollar you spend, be a minimalist, apply geo-arbitrage and live in cheap countries, become a digital nomad, or just be frugal or more intentional with your expenditures. You keep your overheads down and save as much as possible. If not taken to extreme measures (becoming a cheap, greedy or stingy person), and not used as the only strategy, saving (storing away anything between 10%-30%-60% of your monthly income) is necessary for building wealth and financial freedom.
7) Work for it| Ways to Make Money
People rarely get rich from the income of a job. Still, the income from your job, career, or side hustles is a building block of wealth creation. This is where the monthly “seeds” capital to be invested comes from. As such, it is a pillar of wealth creation as long as you divert a reasonable percentage of income (i.e., savings) to productive tasks. Which one? Check it out in section 8!
8) Invest in it| Ways to Make Money
There are several ways to invest in productive assets and build income streams. You can invest through traditional methods like Real Estate or the Financial Markets (stocks, bonds), or try more modern options like Peer-to-peer lending, Equity crowdfunding, or Crypto. There are four keywords I use when investing:
1) Quality assets
2) Diversify, based on geographic location, currency, and asset class (Real Estate, Stock, Bond or alternative assets)
3) Rely on passive and investment models
4) Let it compound (long term, with automatic re-investments)
Check out my Investment page for a quick view of my current investment platforms.
It should not be a surprise that my key pillars for wealth creation are built on saving, working and investing. The rest is just nonsense.
Still, I don’t think these pillars for Sweating Your Assets only entail formulas or processes on how to save or invest. Wealth is not only created through technical skills in managing money properly. There is the other side of the coin: the soft skills required to have the right mindset to build wealth.
You can check out these articles:
Keep it Real. Sweat Your Assets.
Have you enjoyed this article (#17)? Don’t miss upcoming ones. Subscribe for free to my monthly newsletter here.