biophase
Legendary Contributor
FASTLANE INSIDER
EPIC CONTRIBUTOR
Read Unscripted!
Summit Attendee
Speedway Pass
SPONSORED: GiganticWebsites.com: We Build Sites with THOUSANDS of Unique and Genuinely Useful Articles
30% to 50% Fastlane-exclusive discounts on WordPress-powered websites with everything included: WordPress setup, design, keyword research, article creation and article publishing. Click HERE to claim.Join over 90,000 entrepreneurs who have rejected the paradigm of mediocrity and said "NO!" to underpaid jobs, ascetic frugality, and suffocating savings rituals— learn how to build a Fastlane business that pays both freedom and lifestyle affluence.
Free registration at the forum removes this block.Turned out to be a pretty quick and interesting read. One thing of particular interest to me (and us on here) is that he basically says straight up the "Fastlane Strategy" in one paragraph in the middle of the book. "The basic plan is to work really hard for 1-5 years, amass great wealth, and then live off the income from investing that chunk of money for the rest of your days".
People with both skills of successful entrepreneurs and successful investors are very rare. Most are better off continuing to do what they are good at. Investing is a whole 'nother realm. I've seen many successful business people lose a ton of money investing because they weren't prepared. Many cavalierly write as if investing once you made it, is easy and autopilot.
One thing of particular interest to me (and us on here) is that he basically says straight up the "Fastlane Strategy" in one paragraph in the middle of the book. "The basic plan is to work really hard for 1-5 years, amass great wealth, and then live off the income from investing that chunk of money for the rest of your days".
Mmmmm.. It's hard.It also produces Slowlane millionaires that retire very early
Mmmmm.. It's hard.
Let's assume an average 6% pa return on investment, first deduct tax, so to simplify lets just say that leaves us with about 4% ROI. Then factor in inflation (if your living off investment returns then you need to still build your capital to cater for inflation long term by reinvesting some of it) so that's 3% long term average. That leaves you with 1%pa ROI.
So after tax how much do you need to live on? Let's say 30k minumum in todays $ (doable assuming you already have a house with no mortgage). You're gonna need 3mil.
So you've got to either increase your investment returns or decrease your tax liability (which you can do by investing wisely, but at some point you're going to need cash flow, which means tax has to be paid). It's doable, but it's very tight, and you have to be willing to live a very modest lifestyle for the rest of your life, and have the discipline not to start living off savings, only the returns (minus tax, minus inflation).
It's the same in Chinese culture. Studying and being educated is a must and has been for many centuries.
I think there was a thread on this. MJ asked why Asian parents always chose a kid's career path for them instead of letting them be happy.
It's actually got little to do with the kid's happiness or even the parent's happiness but instead has to do with the kid's chance of succeeding. A child has a better chance of succeeding in a profession that is always demanded, like doctors, lawyers and engineers. A parent doesn't really care that much if the kids become rich beyond their wildest dreams but instead would just like to see them in a successful profession.
People with both skills of successful entrepreneurs and successful investors are very rare. Most are better off continuing to do what they are good at. Investing is a whole 'nother realm. I've seen many successful business people lose a ton of money investing because they weren't prepared. Many cavalierly write as if investing once you made it, is easy and autopilot.
Yeah, here's another thing he mentions in the book: one of the reasons many Jews are so wealthy is that they have always put a strong emphasis on education and high-income careers, like doctors, lawyers, etc. Another reason is that many have been business-owners, which is a powerful way to be in control of your own money. Using that launchpad, work hard, make millions, then live off the investment returns.
That's an interesting concept. It also produces Slowlane millionaires that retire very early without (1) getting very high paying jobs and (2) without starting a Fastlane business.
Usually they retire before they become millionaires, though.
Essentially: go to school, get a job that pays you a nice amount of money, live far below your means, save your money, invest it in actively cashflowing assets, and leave your job once you can live off of AND continue building on your assets.
This produces people who retire at 35 and become millionaires by 45. Not Fastlane but uses Fastlane principles. I'd say it's smart for about 90% of the population. Many immigrants use this method and it's one of the reasons why immigrant families become so rich. They work hard, save hard, invest hard, and teach their kids to do the same.
The numbers mean that you always have to be making your own soap and eating from your garden and stuff.
That's an interesting concept. It also produces Slowlane millionaires that retire very early without (1) getting very high paying jobs and (2) without starting a Fastlane business.
Usually they retire before they become millionaires, though.
Essentially: go to school, get a job that pays you a nice amount of money, live far below your means, save your money, invest it in actively cashflowing assets, and leave your job once you can live off of AND continue building on your assets.
This produces people who retire at 35 and become millionaires by 45. Not Fastlane but uses Fastlane principles. I'd say it's smart for about 90% of the population. Many immigrants use this method and it's one of the reasons why immigrant families become so rich. They work hard, save hard, invest hard, and teach their kids to do the same.
what is consider "nice amount of money"?
Amass 10mil.... lend it out for 5% - 10%... and you would be getting $500k - 1mil a year. That should be enough income to live well and still be able to put some of that income aside (for a little higher risk investments).
Lots of entrepreneurs assume that since they got their business to make a lot of money, they're smart and obviously could make money investing since it's easier, right?
Not quite. \\\
It's the same in Chinese culture. Studying and being educated is a must and has been for many centuries.
I think there was a thread on this. MJ asked why Asian parents always chose a kid's career path for them instead of letting them be happy.
It's actually got little to do with the kid's happiness or even the parent's happiness but instead has to do with the kid's chance of succeeding. A child has a better chance of succeeding in a profession that is always demanded, like doctors, lawyers and engineers. A parent doesn't really care that much if the kids become rich beyond their wildest dreams but instead would just like to see them in a successful profession.
I was raised this way but I'm glad my parents were supportive of my decision not to go into engineering (I hear it too much from my dad that I had the brain for engineering lol)
Join Fastlane Insiders.