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Monday, July 6, 2009

Busting Your Ass Is Stupid

I read a blog last month that has been haunting me because it gave some bad, commonly accepted, advice to a large number of its readers. It said to make money you have to work hard. The notion of hard work equaling money is exactly what those who know how to make money want you to believe. They need more distracted servants. The author of the blog may be one of those who really knows, or he is simply naïve.

The concept of working hard for your money is so easy to believe because that is what we see and hear. We are taught that the way to make money is to trade your time for monetary compensation. The more needed your particular task is, the higher your pay is per hour. You could simply obtain more money by increasing your personal per hour value (PPHV). Medical doctors, for example, are sorely needed because the number of them is so limited (due to the rigors of becoming a doctor). As a consequence, medical doctors are paid a higher amount per their hour of working time than say a janitor (the pool of potential janitors is much, much, much larger). Most believe increasing their PPHV is the best way to accumulate wealth, but this is WRONG!!!!! WRONG! WRONG! WRONG WRONG WRONG!! Why? Because this method of making money is constrained by the 168 hour law: You cannot work more than 168 hours per week (7 days per week times 24 hours per day). No matter what, the medical doctor who makes his money only based on his work has a maximum he can earn. Sure the amount is a lot, but it is finite and tied to 168 hours, plus it takes him 7 years to start earning it. Earning via PPHV is hard, and can work, but there are other methods that require much less effort.

My most favorite method of earning money is via earning interest. Any money I put away earns me something regardless of what I do. If I put $100,000 away, every year I earn $5000 and I don’t have to do a damn thing. I don’t have to lift a finger, yet $5000 is handed over to me. (pick your scale, $100 = $5 in interest).

Those arguing that hard work is required will say, “Yeah, but you had to somehow earn that $100,000?” True, but maybe I built up to that using interest. Maybe someone gave me $100,000 in inheritance. Maybe I won the money in a Lotto. Maybe I easily seduced female billionaire and she paid me for my services (okay, that may be a stretch). Maybe I have the easiest job in the universe making minimum wage and I saved like crazy, lived dirt poor, and now I’m living off the interest of my savings.

The point is, if you believe that the only way to make money is the “hard way”, then every way you will try will be the “hard way.” If you believe that you can make money the “easy way” too, then you will find easy ways. I’ve highlighted 1 way, and there are more, but that is left up to you to find them. (oh wait, that's hard work!)

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