A while back I made a list of as many ways as I could think of to ACTUALLY become wealthy. Before I begin, it’s important to know the definition of “being wealthy” that I am writing about. For me wealthy is having the financial ability to provide awesome experiences for my family and having the freedom and time to do so (I’d love to hear your definition of wealthy in the comments below, let me know!). So when I’m talking wealthy, there isn’t a specific amount of money involved it’s simply (again at least for me) having the financial resources and time to do what you want.
Anyway I cut the list down, taking out options such as winning the lottery, suing a company that did you wrong, finding gold, or finding that old antique in your grandma’s basement that you sell for millions (you know all the get rich quick methods that are most likely not going to happen to you or me so we’ve all hopefully stopped banking on them). I ended up with the BIG 5 for my list, but I’m sure I’ve missed some so if you think of another actual way to become wealthy, holla!
Okay here is the list:
1. SLOW ACCUMULATION (or loooong term investing): I’ve said this before and I’ll say it again…I truly believe anyone can be a millionaire (or greater) by the time they retire. I really do, is it going to take some work and discipline? Of course! Is it possible? Yes! The way to do it is by simply following the rules/steps that a guy like Dave Ramsey or Ramit Sethi lays out. Get out of consumer debt and then begin putting at least 15% of your check into a low fee, low cost index fund (or your 401k, or a Roth IRA, etc.). Let that baby ride for 40 years until you retire. You’ll probably average 7% or 8% yearly interest and retire a millionaire. If you want a little more money stocked away put in 20%. Conclusion…you are going to be in it for the long hall, but at the end you will have enough financial resources and of course time at retirement. Obviously this isn’t the flashiest way or the fastest way and you probably aren’t going to become super mega rich this way, but you can live a very abundant life. It takes longer but you can do it.
Time: 35+ years
2. MINIMALISM/EARLY RETIREMENT: Alright now we’re getting a little more extreme (aaaah, 🙂 I know gettin’ wild). The second way to become wealthy is becoming a minimalist/early retiree (everyone calls it something different, but the principles are the same). Basically what this person does is take the long term investing approach and pumps steroids into it. What a early retireist would do is save everything they can, live on as little as possible while still being able to enjoy their life and putting the rest into investment accounts. Many suggest you put your money in your 401k and/or a low fee index fund. You max those puppies out for 10 years and with only needing a small amount of money to live on you can retire in your 30’s. Obviously there is a lot more strategy as to where to invest (mostly having to do with tax benefits), how you are going to withdraw your money, how much you need saved, etc. The point is, save as much as possible and invest it and let compound interest do the rest.
Time: 10+/- years
3. HIGH INCOME EARNER: Okay so this one is a little harder for the masses to accomplish but anything is possible right? People who I would put in this category are top income earners such as athletes or celebrities. If you are athletic and have the drive and work ethic you can make big bucks professionally. Also, if you are good at acting, singing, dancing, entertaining etc. (and are in the right place at the right time) then you can also earn a lot of money being one of the top in your profession. I would also include c-level executives or top level employees (if you are a good sales guy and work hard you can usually make good money) in a company. This is a little more attainable for most people than athletics or movie stardom. Obviously this route takes hard work with long hours, being smart and intelligent, a little sucking up and an opportunity given, but it is possible to become a top income earner by rising to the top at your company. So with hard work you can become very rich and if you play your cards right eventually you’ll have the time and freedom to do what you want. 🙂 *Keep in mind even if you are a high income earner you still have to have some money sense because as we’ve seen (mostly with celebrities and athletes) people can go through a lot of money very quickly.
Time: 10-20+/- years
Resources: Grant Cardone (hard work and hustle)
4. ENTREPRENEURSHIP: I had in mind “creating a company” for this category but in saying that it felt like I was inferring something like a software or retail company. I was also considering another category about starting a small business or side hustle, but that felt somewhat similar and it all falls into the entrepreneurship category anyway, sooooo that’s the thought process there. 🙂 With that being said here are the sub-categories ;)…
a. Start a company: We’ve all heard the negative sides of starting a company, you know, most of them fail, you have to work 20 hour days, it’s super stressful and there can be a ton of drama. Put that aside and many people have become wealthy by starting a company and seeing it grow. Either selling it or becoming the CEO and reaping the benefits. It’s possible but hustle and grind is required.
Time: 5-20+/- years
Resources: Nathan Latka
b. Start a small business: Maybe you don’t want to grow your business so it becomes a huge company. You can create a small business as a solopreneur or maybe with a couple partners and employees. If you can build it to produce a decent sized revenue you get all the money. You’re working for yourself so whatever you put into it you get out of it. That’s the nice thing, you get to keep your money instead of only a piece of the pie. Obviously if you want to scale your business you’ll need to eventually hire employees but hopefully with that you create more money. This is an excellent way of making good money and having time and freedom (you’re your own boss).
Time: 5-20+/- years
Resources: Arnie Giske
c. Start a side hustle: Okay so you like your 9-5 or you don’t want to risk quitting and seeing your venture fail but you want/need more income. You can start a side hustle (which can eventually turn into a small business). Starting something on the side can be a great source of income. As you grow it you can eventually make a lot more money.
Time: 1-5+/- years
Resources: Nick Loper
5. RICH DAD POOR DAD: I hope most of you have read the book Rich Dad Poor Dad by Robert Kiyosaki, if not I’d highly recommend it. Mr. Kiyosaki recommends you create a portfolio that has assets which generate money that is greater than your expenses. He defines an asset as “anything that you acquire that puts money in your pocket.” He suggests things such as real estate, the stock market and high return investing strategies as possible assets. Let me give an example…if you spend an average of $3000 a month (and that covers aaaalllll of your expenses) you would need to find a way to acquire assets that generate $3000 or more a month. If you are able to do that you no longer have to work for a living…giving you time. As you gain more assets, you gain more money which will increase your financial independence. In other words “know what an asset is, acquire them and become rich.”
Time: 10-20+/- years
Resources: Robert Kiyosaki
Final Thoughts: Alright, there are the 5 REAL ways to become wealthy, have financial freedom and gain more time to do what you really want. The next step is to pick the one that best suits you and what you want to do and go for it. What would you add or take away from this list? Let me know in the comments below. Also I’d appreciate if you could share this with anyone who could use a little boost or help creating ideas.