Last week, I wrote about how I learned to become rich, starting with increasing my income by $1,000 increments and working my way up to $10,000 increments.
What was the next step?
To learn how to get richer $100,000 at a time.
I achieved this by becoming a business owner – by inventing a new product and convincing my boss to give me a 25% stake in it. This new product made more than $200,000 in profits within months.
I spent the next 10 years learning how to build a serious business with the man who was now my partner. Our business went from $1 million to more than $100 million in revenue… $1 million at a time.
Over the following 10 years, I started many other businesses and invested in real estate. My wealth grew by tens of millions. But, for the most part, it was with a series of $1 million deals.
And though the main business I worked with at the time grew in $10 million increments, my compensation was always a smaller portion of that. So I can’t say that my knowledge of getting rich has ever gone beyond earning $1 million at a time.
By diversifying, I was able to increase my overall income by $3 million to $5 million per year. (Uncle Sam always took his 40%.) That was (and is) a lot of money.
I realized that I was earning enough to fulfill any need I could possibly have. So I turned my attention from increasing my income to building sustainable wealth. Looking back, I know I made the right choice.
Getting rich $1 million at a time was and is enough for me. And it should be enough for anyone.
So even if you have the billionaire bug, you should follow the process I’ve been describing: getting rich one decimal point at a time. You should do that because it’s the only practical and reliable way of becoming wealthy.
You do it step by step – first getting richer by thousands, then by tens of thousands, then by hundreds of thousands and then by millions.
The process might mean taking steps like these…
- If you are a salaried employee, you can increase your income by becoming the most valuable employee in your business. This will increase your wealth by tens or even hundreds of thousands of dollars at a time – though it may mean switching employers as you go.
- If you are a professional or small business owner earning six figures, you can increase your income in $100,000 increments by replicating your business.
- If you own a business that is making millions of dollars per year, you can keep growing your business and your revenues.
I go into detail on all of these in my books Automatic Wealth: The Six Steps to Financial Independence, The Reluctant Entrepreneur: Turning Dreams Into Profits, and Ready, Fire, Aim: Zero to $100 Million in No Time Flat (all of which I published under the pen name Michael Masterson). And I cover them further in other essays as well.
Meanwhile, there is one piece of advice that I have for everyone who wants to become rich – millionaire rich or billionaire rich: Develop a financially valuable skill.
A financially valuable skill is a skill that will help you climb the wealth ladder one step at a time. It is a skill that will put you in the mix whenever the opportunity to acquire wealth appears.
There are not many financially valuable skills. In fact, there are basically only four: marketing, selling, coming up with profitable ideas and managing profits.
Learning how to sell is probably the most important of these skills because it will allow you to sell your ideas, as well as the idea that your ideas are valuable. You will need this skill in just about every possible business situation.
Marketing is also a very important skill. It will allow you to sell your company’s products and services to an ever-expanding market. It will also allow you to generate more income from the customers you have.
Learning how to come up with profitable ideas is the most difficult skill to acquire. Many wealth builders never learn this skill. They simply use their sales and marketing skills to convince idea generators to sell them their ideas or work for them. If you don’t feel you have this skill, don’t worry. You can still become wealthy if you have some combination of the other three skills.
The final skill is managing profits. This is essential for building wealth. Many people develop businesses that bring in significant revenues. But because they lack the skill to create profits, they never get beyond earning a decent living. They never get rich.
The good news is that learning how to manage profits is the easiest skill to acquire. You simply must commit yourself to it and pay attention to your business. The opportunities to increase cash flow and cut costs are always present.
So there you have it: several more tools for becoming as rich as you possibly can. Learn one or several of these financially valuable skills, and then learn from them how to increase your wealth one decimal point at a time.