Just like other mathematical equations, how wealthy you become is the outcome of an equation.
In case maths was not one of your choice subjects in school, don’t worry this is nothing like your school.
Yah!
Let me tell you a secret.
This post is part of my scripted work for a book that I hope to publish many years from now.
I am sharing it not just because I’m a nice guy, but to help you make better choices.
Remember, your life is a product of your choices.
If you want to have a good life, then you must make the right choices.
Unfortunately, the wrong choices don’t come with a label and many times they look more right than the right choice.
The good news is that information can help you make better decisions.
It is even more powerful when you can flood your subconscious mind with sound information.
Do you know that 95% of your decisions are made from your subconscious mind? (At least according to statistics available on the internet)
This is why they say success is atmospheric.
Because in the right environment, your unconscious mind learns to make better & smarter decisions.
For instance, you have chosen to invest in yourself by reading this post.
The advice you’d find here would ultimately affect some other set of decisions you would take in the future.
Now, you may not even remember exactly how you know to make the right decision.
Since I aim to help you make smart decisions when it comes to online business, it just makes sense for me to expose you to this topic.
HOW TO DERIVE YOUR WEALTH EQUATION
As a disclaimer, this is not some alien concept. You might already know this in one way or the other, maybe not in this exact manner but I guess somehow every one of us has an idea of this.
What I intend to do is make it clearer to you, so you can make better choices.
So What Is Your Wealth Equation?
Your wealth equation equals all the choices you have made regarding your wealth plus any advantage.
Whether you like it or not, everyone’s advantage is not the same.
For instance, good governance, trust funds, a large inheritance, social capital, and wealthy parents are advantages to those who have them.
Let me give you an example of what I mean.
If you are married into a prominent family, usually that brings access to open doors the average person can only dream of.
With such open doors, come contracts, partnerships, recommendations, funding, secrets, etc.
Such an advantage can help such a person achieve 25 years’ worth of success in 12 months!
We have all heard stories about how the US & Canada have become a hotspot for immigrants from all across the world, not for their beauty alone but mainly for the opportunities the economy affords to any Tom who is ready to sweat it out.
In some other cases, people get a large inheritance, or trust funds, and are catapulted to wealthy and affluent status in less than a blink.
Let’s look at a popular stat from a different angle…
Over 65% of Billionaires are self-made — Wikipedia
Meaning they worked hard to attain their wealth.
What we forget to ask is how about the other 33%, how did they become BILLIONAIRES?
The simple answer…
– An advantage happened!
Now I’m not saying this to make you feel bad if you have little or no such advantage because…
The good thing about the equation is that you can manipulate it even if it seems you have no advantage.
Let’s take it a step further.
At birth, your wealth equation was = 0 + Advantage
If we assume that your advantage was 0, then your equation becomes
W.E = 0
Let’s assume, you also get a job at say Amazon, and you are paid $16 per hour, your wealth equation becomes:
W.E = $16 x hours worked + 0(Advantage)
With this equation, if you want to become a millionaire in 5 years, then you have to work for 62,500 hours but the problem is that there are only 43,800 hours in 5 years.
It is impossible to work more hours than you have in a year!
And we’ve not even taken into account the times you would have to sleep and that you’d spend parts of the income on bills.
Another huge problem with the wealth equation in my example is that…
It is impossible to control or scale how much you earn.
It will be very difficult to walk up to your employer and say, I now want to be paid $160 per hour.
That’s an easy way to get fired!
So you should know that your wealth is a bet on your time.
And “time-based incomes” make this bet fixed because…
Time cannot be scaled.
What this means is that if you want to be rich, you need to use equations that a scalable & controllable.
What do I mean? Come with me, as I dive deep into…
SCALABLE & CONTROLLABLE WEALTH EQUATIONS
The whole concept may sound confusing at the moment, but I’d make it clearer with a simple example:
Let us assume I have published an ebook. With the right marketing in place, the ebook may go on to sell several thousand copies.
This would continue to bring me recurring revenue for as long as it is sold.
The best part is… without me having to do any extra work.
Now imagine I have 10 other ebooks like the one in our scenario…
If they sell for an average of $19.95 each, and I sell just 5,000 copies (…which is easy to do).
That gives me roughly $1,000,000!
Don’t forget, it doesn’t take any more time for me to get more copies of these ebooks in the hands of others than it does to say, Jack.
Thank God for printers!
I won’t have to manually write 5,000 copies with a pen and many blank sheets!
That would’ve been terrible!
Before I show you the next example, let me dig a little deeper into the concept of “control” in the wealth formula.
If you work for a company, you are paid based on the total of all employees’ performance.
The reason this will not work out well for your wealth equation is that, in this situation, you are paid based on an ESTIMATE of your contribution to the overall success of the company
So even if you work your ass off – you still get the same pay or probably a little more in the form of bonuses as every other lazy jack-ass.
But in essence…
This is a limit on your income “control”.
Except in cases where you are a salesperson and earn commissions from sales (performance).
The first thing you need to have to create wealth is “control”.
You need to earn based on how well you perform – and that is why commission-based salespeople or closers are closer to creating wealth than many other career types.
However, the only thing lacking in the wealth equation of salespeople is the ability to scale performance.
Let’s assume you can consistently sell 100 pieces of your company’s product and that gives you $10,000 a month, it will be extremely difficult for you or anyone to sell 10,000 pieces to make $1,000,000 in any given month or year.
That means you lack scalability.
So the two things you need in your wealth formula are control and scale.
What this means is that you earn based on how hard you work and how fast your work benefits others.
This would make your wealth equation look like this:
Wealth Equation = eBook A ($19) x 7,000 sales + $100/mo. software x 10,000 users + $1,900 online course x 500 sales + …
Already, someone with this kind of formula would be a multi-millionaire!
It is not easy to build such formulas.
I should know, I have been in the trenches for about a decade now.
I started different businesses, some worked out well, others didn’t do well and I shut them down. If you say they failed – I’m okay with that 😎
I’m still building my wealth equation and you should be about yours too.
Now, if you already have a job, I’m not advocating that you quit your job and start building a business —That may be foolish advice!
What I am saying is that you should start making choices & decisions that make your wealth equation more scalable and controllable.
Always look at the big picture.
You don’t have to rush it, one step at a time, and gradually you will get there.
We’ve talked a lot about the equation of wealth and I’m guessing you found it to be profound, but we haven’t addressed –
Why the “people” in your equation would give you money in the first place?
So you know how your equation should look, but what you haven’t figured out is how the figures in the equation happen and that is what I call…
The Concept of Value
A wise billionaire once said that if he wants money all he does is ask himself – “Who is with my money?”.
And I agree.
Listen, if you want to become rich, people have to give you money.
The number of people giving you their money and how much they give equals how much you’ll have.
So why would people give you money?
Let me show you.
People give money in exchange for perceived value.
Value comes in different shapes and sizes but they all fit in one bucket called…
TRANSFORMATION
Almost everyone buying a product or service is hoping to get a form of transformation.
It could be to lead a happier life or build better relationships, get more customers, make more money, become healthier, have better looks, and a gazillion other things.
The truth is that if you can create a product or service that offers such transformation, people in need of that transformation would beg you to take their money.
This transformation is the…
Definition of What Value Is.
And that is what ultimately defines how much people would be willing to pay for your offer (…or in exchange for your transformation).
So to build your wealth equation, look out for scalable “transformations” you can offer to many people; execute and you will be well rewarded with a fat account balance.
Summary
One of the simplest and easiest ways to build a formidable wealth equation is to create and sell information products.
I mean products that teach people how to achieve something; they are easy to create if you have a skill, a hobby, or are an expert.
This is the first step I recommend people take when they want to transition from paid employment to entrepreneurship.
If this is something you are interested in learning more about, Click HERE
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