Though this is essentially a general personal-finance blog, its mission is ostensibly to answer—and pursue an affirmative answer to—the question: “Can I get rich on a salary?” Also considered in the variation, “Can I get rich without quitting my job to do something crazy (or that my spouse, child, parent, or other relevant person thinks is crazy)?”
And although it risks some absurdity, let’s put aside the definition of “rich” for the moment, for fear of a War-and-Peace-length dialogue unfitting for a sleepy Wednesday hump day. If needed, we can go with, “I know it when I see it,” for now.
Regardless, it seems premature to tackle, “Can I get rich on a salary?” It seems to me the first question must be, “Can I get rich?,” period.
To this end, let’s look at some of the main paths how anyone ever gets rich. I probably missed some important ones, so please help me develop this list further.
Build on amazing vision—to develop game-changing technology, dominant businesses, or world-class brands (or several of those together). Think: building Microsoft or Google; innovating process or business models like Dell or FedEx; growth and size like WalMart; product brands like Coke and iPod and personal brands like Oprah Winfrey and Martha Stewart.
Ridiculous TalentHave or develop best-in-class talent—in a high-profile and high-money arena. Think: Michael Jordan and Tiger Woods level athletes; filmmaking like George Lucas; top actors and models; popular singers and bands.
As the saying goes, “I’d rather be lucky than good.” Think: winning the lottery; winning a slots jackpot in Vegas; big inheritance; being born into a family fortune; accidentally finding a pot of gold at the end of a rainbow.
Be in the right place at the right time—by choice perhaps, but with lots of luck. Think: an intelligent but lucky stock pick; an intelligent but lucky job choice (company goes IPO).
Small Business Empire
Start a profitable small business and expand, probably in some controlled and more measured way. Think: owning a regional chain of drycleaners or fast-food restaurants—that will likely never scale much larger than regional but generates lots of positive cash flow.
Small Business Investment
Put money into a small business to earn additional income. Think: putting money into a drycleaner or fast-food restaurant; starting a side business.
Highly Aggressive Investment
Put loads of money (perhaps borrowed) into sexy, high-return investments—with significant potential for losing it all (and maybe going into debt to boot). Many would call these speculative investments. Think: flipping real estate; buying on margin; hedge funds; investing in a specific company in an emerging market.
Be really smart, good, or lucky at your investments overall—so that your overall return beats the market on some regular basis. Think: individual stocks; buy-and-hold real estate.
Slow and SteadySpend less than you earn (or as some folks have been framing it: earn more than you spend). Take the difference and invest it over a long period of time to take advantage of compound interest/gains—typically in investments with more measured risk, such as low-cost index funds. This is the approach espoused by many personal-finance blogs, including leaders like Free Money Finance, Get Rich Slowly, and The Simple Dollar.
All of these “paths” require different amounts of luck, skill, and time. Next, we’ll look at those issues broken out into assessing each path’s financial upside and downside, barriers to entry, and other advantages and disadvantages. Obviously, some of these paths aren’t available to most of us—so we assess which might be available and why the heck these might be worth looking at anyway.
But this is getting pretty long already, so I’m going to split this into two posts. I am hopeful that Part 2 will come out tomorrow or on Friday.
For Part 2 of this post, please click below:
The 9 Or So Paths To Getting Rich—And My Purported Analysis Of Them (Part 2 of 2)
Success Factors Of The Really Rich?
20-40% Returns Sound Heavenly But...
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