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This article is one out of seven that I wrote about wealth. The whole
series contain a lot of free valuable information about key factors
that can help you become wealthy. The rich do things in a different
way. That difference is the one I want to explain here. Let’s
scrutinize together these strategies that can make you more money and
help you boost your income.
The whole series contain the following articles . . .
1. Add Value.
2. The Multiple Streams of Income.
3. Passive Income.
4. Residual Profits.
5. Leverage.
6. Specialization.
7. Compound Interest.
Now, based on my own experience I believe that one of the faster and
safer methods to create wealth is to add value to other people’s lives.
You see. I believe that wealth can be created. The rich often become
rich by offering better technology to other people than the one they
already have. After all, that’s the idea behind capitalism.
The idea is to become rich by enriching other people’s lives. If you
focus on making money, chasing money, growing money, getting money, you
may stay poor. If you think about solutions, how to come up with
solutions to other people’s problems you may become rich one day.
The beauty of this is that you don’t have to force people to give you
their money. You don’t have to steal, cheat, lie, deceive. In fact you
don’t need to make big efforts. You don’t need to beat up anybody in
business. If you come up with creative solutions to common problems and
learn how to market the ideas effectively, people from all around the
world will be willing to give you their money in exchange for the
products and services that you offer them.
Your goal like mine is to make money. That’s how we exchange values
today. Money is turning into a drug in society lately, because many
people can’t understand how the system works. Before money was invented
people could understand much better the concept of creating wealth.
This is how it used to work. Let’s say that you were a farmer, so you
had lots of food. Other person in the same town was a carpenter. So,
whenever you needed some furniture for your house, you went to the
carpenter and exchanged values with him. He agreed to make the
furniture for you in exchange of some food for his family and himself.
In some way you agreed to work certain amount of time on your farm
rising crops for others while others agreed to spend time working on
their businesses for you. That’s how it used to work and that’s how it
still works today but with a small change. Today we use money as a mean
of exchange.
The reason we exchange values is because we humans can’t be expert in
everything. We use a special kind of social leverage. I do something
for you because this is my specialty and you do something for me
because that’s your specialty.
The only difference is that today we use money as an intermediary which
makes it even easier to exchange one value for other. Now I don’t have
to waste time with the carpenter agreeing how much I think a bag of
beans is worth compared with a chair. The carpenter sells the furniture
for certain amount of money and I know since the beginning if I want to
purchase it or not.
Money is simple. Some people want to make it complex but it is not. Now
I don’t know if you have noticed something here. If all we do is to
exchange value, then society doesn’t advance. We would still be in
stone age. It would be something like this: I get some bananas for you
and you hunt some animals for me.
You reap what you sow. That’s why when you enrich society, you yourself
become rich! So, adding value can make you money, but it won’t
necessarily make you wealthy. In fact even if you work for yourself and
you are able to become financially free at a young age, it is probable
that you still will have to work a lot if all you do is to exchange
values.
Then how do you become wealthy? By creating values. You need to find
solutions to common problems. The better your solution is the more
money you can expect to make. Most people still get it wrong when they
discover this.
Let’s say that you find a common problem and you decide to write a book
about it. Your book contains information to all those people that are
facing this problem and it helps them solve it. Now, analyze this, how
many books about the same subject aren’t out there containing
information about how to solve that problem?
Unless your book is among the best ones on the market then you still
have not created something new. You have added value but your perceived
value in the eyes of the general population is too low.
Wealth is not directly proportional to your efforts. In fact it has
been said that “Poverty is a big effort that produces a small result
while riches is a small effort that produces a big result.” You may
think that you have created a diamond, but if most people don’t like
it, think it is too expensive or are not willing to buy it, then you
won’t make any money and you will be frustrated.
It is important to understand what people want so you can give them
what they want. People want better technology, cheaper energy prices,
more money, more knowledge, fresh new information, among other things.
Your income will be directly proportional to the general perceived
value of your efforts to improve the lives of others.
Of course there are people that make some money stealing and committing
illegal acts, but graves and jails are full of those kind of people
don’t you think? I don’t blame nor judge those who take that path. It
is their own decision and I respect that, but as I said before, there
is a safest path.
Most people in society make money by adding value to others, otherwise
society as we know it couldn’t exist. If you wake up every day and go
to work on your job, whatever your job is, if it is legal, then most
probably you are adding value in some way to the life of others.
If you choose to work for yourself because you want to become rich or
financially free and you do something, make something, build something
or offer some services to other people, you may still not become rich
until you realize that you need to create values. If your perceived
value is too high, even if you do not create something huge you still
may become rich.
For example if you have the funds required to build houses or
residential real estate and you hire a custom home builder company, you
may generate a huge income this way. One general problem that people
have is that they need a house where to live. Houses are very
expensive.
A new house is a general solution to a common problem. You are still
not creating something new. There are millions of houses out there, but
the perceived value of what you are doing is so huge that you may
become rich within a few years. “The easiest way to make money is to
help other people make money.” The easiest way to become rich is to
enrich other people’s live.”
If you lie, steal, cheat or deceive, you may be disappointed of the
results. No body is stupid. People that make money the wrong way and
get away with it are experts on their field. Amateurs often get caught
and get in trouble. You see. Society is competitive. Life is though,
but it is also pretty, specially if you play by the rules.
Some people like the gray area. Gambling and trading fall under this
category. Both of these are quicksand. Today you are above and tomorrow
you are bellow. I trade the financial markets and I love it. I gamble
from time to time. I play the lottery sometimes just for fun.
I don’t lose the real thing from my sight though. This includes the
time and effort that I devote to my activities. Instead of sitting in
front of a slot machine for hours, I sit down and write a few articles
that could help or improve the life of somebody, somehow, somewhere. I
devote must of my working time to adding value and whenever I can I
create some values I do it too.
I understand you. Creating value is very hard. I know. To come up with
creative solutions to common problems is not easy. That’s the beauty of
it. If it were easy someone would have done it already. If no one have
discovered a solution to that problem is because it is hard.
You don’t have to do it yourself though, but there is always a price to
be paid. You can spend time and think hard how to do it or you hire
someone to do it for you and pay them. That’s what many company do.
They hire qualified employees like engineers, software developers, etc,
to come up with the solutions and pay them substantial incomes for
their efforts.
Some employees feel exploited because they have to produce more than
they earn otherwise the company would go bankrupt. Did you understand
what I just said. If you have a job, you will probably have to produce
more than what you earn, otherwise the company that you work for would
go bankrupt. It is how the system works, believe it or not.
In the other hand, no one prohibits you from starting your own company
if you live in a free market economy. If you ever find a way to work
for yourself, you will realize how productive your efforts really are.
When you no longer have a boss who tells you what to do, when you are
on your own, you will see if as an employee you were underpaid or
overpaid. You never know for sure unless you try it.
I have being working for myself for quiet some time and I used to work
for other companies in the past. Now I can compare. In some jobs I was
underpaid, while in others I received more than I deserved.
Some people start working for themselves and become millionaires within
6 months. Others go back, find another job and stay as employees for
the rest of their lives.
The bottom line is as follows. The first key to creating wealth in your
life is to add value to the life of others. Your wealth will depend on
the perceived value of your efforts in the eyes of society. On a free
market economy people bid with their wallets.
If you are a doctor working for a hospital and you make a quarter of a
million dollars per year, within four years you can become a
millionaire based on your income alone if you save it all. If you use
part of your income and save another portion of it, you still can
become a millionaire even if you don’t save it all.
That’s because the perceived value that you add is high and your income
indeed is also high. The same with lawyers and home builders. The same
with many other professions, products and services that are in high
demand. If in the other hand you do something that anyone can do, then
your perceived value by society will be too low. Unless you become very
good at it, you won’t make a lot of money. Then you have the second
choice.
Create something new. Create something that’s really new. A new market
that didn’t exist before. A product that is really innovative and solve
a real problem. A service that truly help people solve a problem.
Something that do not exist yet. Simply something new. Create a good
solution to a common problem.
Next you will have to learn how to capitalize on your idea. Creating is
not enough. Other people will try to still your idea. The better your
stuff is the more coveted it will be. Others may hate you because you
are smart. Expect to make money with this for a few years. The very
moment that people find out your thing is profitable, they will start
trying to copy it even if you patent it.
They will attempt to go around it. They will make a big effort to make
money from it. It seems that is easier to copy/steal other people’s
work than to burn neurons and come up with a solution to a problem.
That’s why if you do it, if you take the time to develop something new,
create values and help people to really solve a problem, you stand the
chance to be on top of everybody else on that field. You simply created
it. You are the owner.
When in two or three years people start copying you, it would be too
late for them. You already made your millions. You became wealthy. You
reaped what you sowed. Now you may move on and create something else if
you want or retire and live in peace.
Just don’t forget that the better your idea is, the more envy it will
generate as well as others will try to steal it. If you can stand all
that and discover how to market your ideas effectively you will be on
your very own path to wealth.
Last but not least. Add more value than what you expect to receive.
What? You may ask. The only way you can possible do that and be joyous
at the same time is through leverage, which I explain on one of the
other articles on this series. People will happily exchange their
values (money) with yours if they perceive that what you are giving
them is greater than the money they are paying you for it.
There is a lot of manipulation going on in today marketplace because of
this. All to make the clients feel that they are getting more than what
they are paying for. That’s not good. You can be honest and make lots
of money at the same time.
Remember this, to be successful, people need to perceive that they are
getting more than what they are paying. The only way you can achieve
this is through leverage. Otherwise you will have to work too much to
satisfy your clients tastes and needs.
I share more information about leverage in my other article. I hope
this article was helpful to you and increased your understanding of how
to create more wealth in your life. There are many myths surrounding
this subject, but the basics have always being the same.
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