How you invest your time determines how your financial future will unfold.
When people tell me they can’t invest because they’re too poor – now they don’t use those words – they say they don’t have enough money, I tell them “If you don’t have any money invest your time.”
Unfortunately, most people have no time to invest either.
Why? Because they think that working harder and longer will make them richer.
Unfortunately, nothing could be further from the truth.
In the old days when I was able to conduct seminars, I used to ask attendees to put up their hands if they work really hard and almost everyone puts up their hands.
I then say: “Keep your hands up if you’re a multi-millionaire” and almost every hand goes down.
The problem is most of us are working harder but the inflation-adjusted wage growth for the middle class has stayed stagnated or declined.
Clearly, working more doesn’t mean making more.
If you ask most people why they’re doing all this work, they’ll tell you it’s for money.
By this, they mean a steady pay cheque that provides security.
Money is one of the primary reasons people take on thousands of dollars in university loans to get a degree for a high-paying job that they don’t like but which they spend most of their waking hours at — all while the things they really love in life sit on the sidelines waiting for them to finish working.
The problem with this approach is that you only make money as long as you work.
The only thing of value that you have to sell is your time.
So, in order to make more money, you have to work longer hours, which is physically taxing.
Because you only have a finite amount of time and energy, as an employee, your earning potential is finite.
On the other hand, if you ask most rich people what they work for, they’ll tell you it’s to build an asset base.
By this, they mean investments and businesses that provide steady cash flow each month whether they are working or not.
Instead of spending their life working for money, the rich understand how to make money work for them because they have become financially fluent.
They understand the big difference between growing their assets and working for a pay cheque.
They realise that adding assets doesn’t require them to work longer or harder.
In fact, the more financially fluent you are, the less you have to work to acquire high-quality assets.
The sort of assets that grow in value and over time provide you with passive income, even while you’re on vacation and not working.
In other words, the rich have learned how to make money work for them.
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But not just their own money.
They understand the benefit of using other people’s money to help them get rich.
- They use the bank’s money to leverage and gear and get a better return
- They use their tenant’s money to help subsidise their mortgage payments.
- They use the government’s money in the way of tax deductions and incentives like depreciation allowances and negative gearing
This is not to say that the rich don’t work.
They do – but they work differently from the average person.
They start by planning their future.
They set goals and bring their future into the present so they can plan and budget.
They plan to become the person they plan to become.
They also invest in their financial education because they know their incomes won’t grow beyond their personal growth, so they work harder on themselves than they do on their jobs.
They don’t wish the world of investing, or their business or their profession was easier.
Instead, they make sure they get better at it by slowly, steadily and continual learning and growing.
By investing in their financial education.
To be frank, I wasn’t always wealthy – my parents were immigrants and I grew up in a household where the money ran out before the month did.
But I invested the time to secure my financial future through financial education, even when I had no money to speak of.
Today, after many years, I’m enjoying the fruits of all that education.
I now have money that works for me rather than the other way around.
But it takes time to build a cash machine out of residential real estate – as Warren Buffet says: “Wealth is the transfer of money from the impatient to the patient.”
What are you working for?
What are you investing your time in?
Are you working towards building an asset base so that your money works for you?
Or do you spend your days toiling away at a job you hate in order to make money?
If so, what’s holding you back?
I encourage you to start investing in your financial education today and building for your future through the power of owning income-producing growth assets.