The relationship you have with money will directly affect your wealth.
The fundamental flaw of our modern education system is that we were raised and primed to be employees. Once upon a time, this wasn’t a bad thing. Those who influenced us to pursue traditional education paths wished us no harm. More than anything, they wanted us to be secure, in the best way they knew how.
Our post-depression era parents and grandparents saw our American economy in collapse and sought job-security, defined benefits, and government jobs for stability and safety. For decades, this logic was sound. Go to school, get a job, work 30 years, get a gold watch, and retire comfortably. Things have changed and this is no longer the case.
Employees trade time for money
Most employers have reduced their defined benefits plans to defined contributions and have removed any guarantee as to how much income employees will have when they reach the other end. Worse yet, the employee path pays you the employee less than your worth. Think about it this way, if you work for someone else, you are an investment. Your employer is getting at minimum a reasonable return on their investment and you are earning less than you are worth. This is the cost of “security.” At the end of the day, you are trading your time for money and are lucky if you can retire at close to the same standard of living as your working years.
What about small business owners?
Some employees seek more control over their time and their earning potential and make the decision to start their own business. The drive is commonly to increase earning potential, set one’s own hours, and to have more control over their job. The trouble most small and startup owners face is that their traditional education governs their mindset. The new business owner has already been conditioned to equate dollars to hours. They will find themselves in a different landscape yet still trading time for money. The small business owner is at the greatest risk of making themselves the product of there business, in an inescapable job.
Those who plan appropriately and think big have the opportunity to limit their stay in small-business land to a brief layover in their career as they aim to build systems for their businesses. The smart business owner systematizes their job so that they can give it to someone else. They raise other leaders to carry out their vision. The smart business owner makes money from other people.
If you are unclear what type of business you are in, the test, as described by Robert Kiyosaki in his book Cash Flow Quadrant is: If you took a year off from your business, would it grow while you are away?
Making the switch to wealth and financial freedom
Financial freedom is attained when your passive income from businesses you own and your investments exceeds your expenses and liabilities. Following the thread from Kiyosaki’s book, the person who earns this passive income earns it either as a big business owner or as an investor.
Big is not bad
Big business gets a bad rap. These owners, often the millionaires and billionaires are vilified for their success. Those with employee mindsets often accuse them of being greedy and perhaps their feelings tie to their own realization (conscious or not) that their boss was earning a profit on them.
When you change the way you look at things, the things you look at change. Think of that big business owner not as greedy, rather as giving. Business owners create jobs and opportunities and the best want to raise those they lead into leaders themselves. This is because a big business owner must develop leaders and systems to remove themselves from the operation and to keep the business growing.
Take action!
You’re ready to get into business for yourself and you want to avoid the pitfall of dead-ending yourself in your own company. Maybe you’re already in business and realize you have become too essential. It doesn’t matter where you are. What matters now is that you do not wait to build the systems you need to grow your business to the point that it outgrows you.
- People – You cannot be a big business without others. Even if you are the only member of your company at this point, here is your four step process for assembling the right team:
- Write your own job description and all of the roles you currently have.
- Choose the roles and tasks which are not your strengths or which would best be served by someone else.
- Develop your organizational chart and assign roles to the future people who will take on those tasks. This will inform your next hires.
- Develop a path on your org chart for your growing organization so that as you grow you can assemble the leadership team which will grow your business and pushes you out the top.
- Systems – The only thing a skill which you are uniquely qualified to perform guarantees is that you will forever hold that job. If your desire is to grow, you will need to empower others to do what you do best. At a minimum, you will multiply your own efforts. Document processes, bring others in, and you are likely to find that their unique perspectives bring even more innovation to your already great product or service.
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