Economy works in a manner of ‘reciprocal altruism’. Money is just a tool to trade for goods and services. You solve a problem for someone else and he’ll give you money in return. By implication, this means that there is NO other reliable way to earn money in this economy. Get-Rich-Quick-Schemes or similar ideas are not sustainable as they build upon manipulation while not providing a solution to a real problem.
How To Make Money
The amount of money you make is directly related to the difficulty and the relevance of the problem you solve.
Let’s got through the ingredients of making good money:
Rise among the top 5%
Rising among the top 5% in your field will greatly impact your salary. A study showed that people that were better (knowledgeable) than 95% of the other people in their field of expertise earned significantly more than someone who was just better than 90% of the others.
Sell your knowledge, not your time
Time is your single limited resource. So you might want to reconsider selling it for $20/h. Instead, try to put your knowledge into a system or structure. That might be a product or software, a standardized service or an automated system. Applying this enables you to suddenly leverage your time so you can sell one hour multiple times. Combined with the advantages of the internet, this can be very powerful.
Invest your time instead of spending it
Instead of just spending your time on tasks, focus on the tasks that have a greater ROI (Return On Invest) than just the $20 a company pays you. Consider your time as an asset that you invest. You would preferably invest your time in reading a good book about management instead of playing video games. Invest in the acquisition of knowledge or the creation of something, that might pay off later.
Acquire rare, relevant skills
Look at the problems we have in our everyday lives or at work. Considering your strengths, pick a problem and think about a way to solve it. Then acquire the skills needed for that or learn about leadership and management to gather people that possess the skills needed.
Invest your money
Wealth is not only about making money but also about keeping it. So put money aside for the rainy days and learn to spend (invest) money on things that pay off later on.
“Do the difficult things while they are easy and do the great things while they are small. A journey of a thousand miles must begin with a single step.”~Lao Tzu
Do what you should do
Oftentimes we know what we should do. We know we probably shouldn’t eat something or we should work out instead of watching tv. It’s ok to make excuses but try not to make more than 1 – 2 a day. Don’t make it a habit.
“The only difference between millionaires and everybody else is that the millionaires did the things everybody knew they should do but never actually did.”~Al Howell
Sacrifice instant gratification
In mainstream media you oftentimes hear about people selling their startup for billions of dollars. Or you read about the plans of the richest men in the world. While these are great stories, media never talks about the process. They only talk about the big event, the acquisition, the sale, the big money or new milestones. They don’t talk about the 10 years of failing, the process of sharpening the idea, the struggle of the creation and the endless hours spent in front of the computer. Still, there is no event without process. Picasso, Bill Gates, Sam Walton, Warren Buffet – all of them had at least 10 dark years, where nobody was interested in what they were doing. To do extraordinary things, you need to sacrifice instant gratification (at least businesswise) for later gratification. As an entrepreneur, your gratification oftentimes comes stacked at the end.
“Getting wealthy demands sacrifices that few make, to resolve to live like few can.”
Define your WHY
We just heard about the 10 dark years. Bill Gates and Warren Buffet are pretty smart. Let’s just assume if they needed 10 years to break through, it could be possible that it takes you that long, too. If that happens, you should know WHY you are doing what you are doing. If you know ‘Maslow’s Hierarchy of Needs’ you probably know that the highest level is ‘Self-Actualization’. For most of us, our ‘why is to make a difference. Some of us want to make a difference for their families, so they can live a better life. Some of us want to make a difference in their neighborhood and town. And some of us want to make a difference for the world. Find your why and write it down clearly so you can have a look when you are assailed by doubts and struggling.
Of course we are not speaking about being a generalist here. Still, you want to aquire new skills and look into different things your whole life. This can give you a new point of view of what you are already doing. And while most of us need to outsource something at some point, it’s better to have at least a basic understanding of what you are outsourcing.
One article isn’t nearly enough to guide you on your way. These tips were just the ones we found mosts important. We highly recomment you also read the following book.