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The "Dirty" word... J.O.B.

Discussion in 'General Entrepreneur Discussion' started by Starsky, Aug 30, 2007.

  1. Starsky
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    Starsky New Contributor

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    Cruising around different boards,books & catching all the guru informercials from time to time, has anyone taken note of how that word has taken a beating? Ill agree to part of that especially in the case of a job taken just for money, however I consider it different if the job is tied to a career.
    Ill also further preface that to say that your not relying heavily on that 1 stream of income..

    Any comments?
     
  2. Russ H
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    Russ H Gold Contributor Read Millionaire Fastlane Speedway Pass

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    Starsky, a job is a great way to get income to support yourself and (if you have one), a family.

    But it's not a good way to get wealthy.

    How many employees become rich?

    CEOs. And how many people are CEOs? Say, 1 in 1,000,000 or so.

    Some (esp the MLMers) say that the path to riches and happiness is through self-employment ("owning your own business"). While it's true that this is a better way to make more money (than at a J.O.B.), it's also quite limiting.

    When you're self employed, your income stream depends, to a large degree, on the time you yourself put into it. Again, this is not a problem-- it's just a limiting factor.

    If you are a business owner, you use the power of leverage: You have other people working *for* you. You do some of the work, yes-- but your employees do the lion's share. More gets done. And more money is made.

    If you are an investor, this means you have enough money to lend out to others, and they pay you back (hopefully, with interest). So this is another place where leverage works: Your *money* works for you.

    In the above examples, the earning power of the first two (Employees and Self-employed people) is limited by the number of hours they can put in.

    The earning power of investors and business owners is not limited by the time they devote, but by their overall market and how efficient their system is.

    ********

    So being an employee is not a bad thing.

    Unless you want to be wealthy. :)

    ********

    Here's an example of how you can use leverage to have other people's money work for you:

    If you are into Real Estate, you can get loans from lots of different places, so your small downpayment now controls OPM (other people's money). And if you can buy your Real estate in such a way that it's below market value (as most RE investors do), than you can use the power of leverage (OPM, other people's money) to make lots.

    Example: You buy a run-down house for $200K in a neighborhood of $300K houses. You put $20K down (10%), and get a low-interest loan for the remainder ($180K). You put on a new roof, repaint it, add a lawn, and perhaps add a bathroom.

    It takes you 6 months to do this, and costs $20K, plus the carrying costs (mortgage) of, say, $1200/mo (1200 x 6 = $7200).

    So now you sell the house-- fast-- for $280K ($20K below market value).

    You have:

    280K selling price
    - 20K repairs/improvements
    -7.2K carrying costs (mortgage)
    -1.8K closing costs (since it's a FSBO and you don't pay a realtor)
    _____
    250K left
    -180K mortgage payoff
    _____
    70K (20K is your original downpayment, and 50K is your profit, before capital gains taxes.

    So in 6 months, you took 20K and made 50K with it.

    That's 250% return (20K x 250% = 50K)

    And you did it in half a year.

    If you had the stamina (and were able to find) 2 houses a year, this would mean you would make $100K with only $20K of your own money, or a 500% return on investment.

    Remember-- the $180K that other people loaned you (OPM) for the mortage was probably at 7-10% interest-- a LOT LESS than the 250-500% you just made.

    This is very doable, even in down markets-- but you really need to know what you're doing!

    It's also the reason so many people try to do real estate investing/developing-- since the OPM is so plentiful, it's easier to make money.

    Make sense? :)
     
  3. Starsky
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    Starsky New Contributor

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    Russ,
    It makes much sense, as I have read the CF Quad book, and enjoy a w-2 & 1099s in the E,B & I quads currently. That book inspired me to start a biz & invest proceeds of the biz in RE. which together at this point gross slightly more than my j o b.. However, i do enjoy my career job, & have set a goal to double my salary on my next few 1099's from my corp before i leave it
     
  4. biophase
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    biophase Legendary Contributor I've Read UNSCRIPTED FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR Summit Attendee

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    I don't think that a JOB is bad. A job is the quickest way to get cashflow. If you need money for rent or food, a job is a sure fire way to get it. People have to do what they have to do to survive. Job is not a bad word.

    With that said, you must understand in your head that just having a JOB is the absolute minimum. The job is there to support your day to day living. It is not there to make you wealthy. You must do additional work.

    There's a huge difference between someone who works at a job, goes home and watches TV all night and a person who works at a job, but goes home and works on his business/investments.
     
  5. Russ H
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    Russ H Gold Contributor Read Millionaire Fastlane Speedway Pass

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    Amen, bro'

    -Russ H.

    PS Seems like the TV watcher is always talking about how "lucky" others are, y'know? The ones who work a few jobs, or try to build a business? Instead of his beer buddies, who are all stuck in the same POS job, working for jerks who drive nicer cars.

    (sorry for that last bit of negativity-- but it's what I heard all the time growing up in Dee-troit. Lots of unions guys who made great dough, and p*ssed it all away on new cars, drinking w/their buddies at the bar, and smokin' the best dope they could get their hands on. ;) )
     
  6. kimberland
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    kimberland Bronze Contributor

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    Yeah, and even the CEOs don't get rich
    via the salary route,
    they get rich with stock options,
    in other words... ownership.

    A j.o.b. is a good place to get experience though.
    Thinking of starting up a quick service restaurant?
    Go work at McD's for a few weeks,
    talk to the inside people,
    look at the systems in place,
    the make or break issues...
    Those few weeks at minimum wage
    could end up saving thousands and thousands.

    : )
     
  7. nomadjanet
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    nomadjanet Contributor

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    As an employer I know that some of my employees see their job as just a job others see it as one phase of thier business life. By the same token there was a time when my DH took a job even after we had our first busines going. While he was working at the JOB that provided us with group health insurance and a steady paycheck for living expenses we also made real estate investments and had an additional small business that did not require his time and conducted our life as though we were business people. A job is not a negative thing at all, the person thinks of the job as the only thing he needs to do to assure himself & his family of financal security is the problem. The company or government agency you work for is not your boss, You are your boss, you are the CEO of your business life. Your job is only a small faucet of your business life, every other thing you do to increase your financial well being is your business. Wheather that is real estate investment, stock investment, a small business venture or simply living within your means so that you have the money for your investments, that is your business. If you have a job to make the nickle to buy the stock and you approach buying the stock in an educated business like manner what is wrong with the job part of the equation?
     
  8. Russ H
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    Russ H Gold Contributor Read Millionaire Fastlane Speedway Pass

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    Kimber and Janet-

    Great, great points.

    Isn't it nice to have discussions without being insulted?

    My latest attempt at bringing positive energy to the RD forums ends in one of the antagonists ADMITTING he's doing it to make money off of his sig pimp! Arghhhh! :bgh:

    Here's the thread:

    http://forum.richdad.com/forums/tm.asp?m=618175&p=1&mpage=1&tmode=1&smode=1

    Everytime I come here from the RD forums, it's like the birds start singing, the sun comes out, and everyone just gets a little nicer. :)

    -Russ H.
     
  9. MJ DeMarco
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    MJ DeMarco Raving Lunatic Staff Member Read Millionaire Fastlane I've Read UNSCRIPTED FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR Summit Attendee

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    Admin Post
    Ya should send Peter over there with a few of his cats ... that'll straighten em out!!!
     
  10. kimberland
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    kimberland Bronze Contributor

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    Russ...
    I've given up on that board.
    Not a high enough ROI for me
    (Feeling Good vs Time Invested)
     
  11. Russ H
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    Russ H Gold Contributor Read Millionaire Fastlane Speedway Pass

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    I hear ya, Kimber.

    Boy, do I hear ya.

    -Russ H.

    PS I'm actually having a bit of fun doing this (I vent my spleen over there). It's extra-curricular though-- only do it when I have time to burn.

    My theory is, if'n I can't make a dent over there, maybe some others who are tired of the crap will mouse on over here.

    Yeah, I'm a dreamer. Always have been. ;)
     
  12. Merkin Man
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    Merkin Man Contributor

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    Hey Russ,

    I like to read what you post. As I have noted in other posts in the past, you are a good model to emulate in the quest for financial freedom.

    Just curious, though...a week or so ago you posted a place holder in the "Dream Cars/Dream Toys" thread over on RD for (in my opinion) one of the biggest NNWKIA's on that site. I check back in from time to time to see what you have to say to him, but you haven't finished your response yet. I'm eager to hear what you have to say. And moreso, I'm eager to see his response (drama!).

    IMO, he has been one of the main contributers to the downfall of that forum. :mad:
     
  13. Starsky
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    Starsky New Contributor

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    Rich dad forum= bad repeated ad nauseum...

    Back to topic,,

    Would one consider being in the E,B,I quad in the fastlane?
    IMHO, it does considering you could use your w-2 money for personal expenses/debt paydown. 1099 money could/should be used for investments instead of trying to live off & invest with that 1 stream of income..
     
  14. Russ H
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    Russ H Gold Contributor Read Millionaire Fastlane Speedway Pass

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    I'd have to say "maybe" . . .

    A high school student could easily have a few shares of Apple (making him/her an "I"), work part time at the local ice cream shop or Mickie D's (making them an "E"), and have an online blog w/google adsense (making them an "S").

    This might give them a disposable income of, oh, $100 a week, while they lived w/their parents.

    Not fastlane. :cool:

    Note that the Cashflow Quadrant definition of a "B" owner is that they have at least 50 employees-- which means most small businesses do not qualify as real "B"s.

    ****

    I think we have yet to define "fastlane".

    For me, this is what it's NOT:

    -It's not collecting unemployment insurance, food stamps, or some other social program.

    -It's not living with your parents.

    -It's not living on someone else's dime (there may be some disagreement w/me on this point, as Anna Nicole Smith didn't make a whole lot of money working-- but she certainly aspired to live life in the fastlane).

    -It's not doing a 9-5, eating at Applebees w/the wife and kids after work, and going home to watch TV until bedtime.

    -It's not working *any* job (E or S) for 80-100 hours a week, with no real chance of making this a stepping stone for greater things. This is a tricky one-- for instance, someone who works their butt off at MLM or selling vaccuum cleaners might never make a whole lot of money, but they will probably develop skills that will be invaluable to them later on-- so for that person, developing those skills makes them fastlane material. Because they are doing it to get up to warp speed.

    -It's not trying one business idea after another and telling everyone "none of them ever work out." Part of the fastlane is failing-- and learning from your mistakes. Virtually all of the world's successful entrepeneurs and business people failed repeatedly. It's what they did after they failed that made them winners (i.e., they looked at the failure, learned from it, and had the courage to get back up and keep going).

    ****

    OK, those are my .02

    Anybody else?

    What is the fastlane?

    Or, What is not Fastlane?

    Actually, I'm gonna make this a separate topic-- so post your feedback here:

    http://thefastlanetomillions.com/showthread.php?p=3107#post3107

    -Russ H.
     
  15. venom
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    venom New Contributor

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    In the cashflow game having a higher paying job actually slows you down on the road to the fastlane. In real life I think its another tool to get you were you want to go.
    If you treat it right then it will help you. If you get complacent then it will slow you down.
     
  16. Starsky
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    Starsky New Contributor

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    does it say that? Ill have to go back to reference, however I know MLM type business's where included in that quad (RK loves MLM lol-loves selling to them that is) & I dont know any MLM'r having 50 employees unless your counting there "downline" lol. If anything the B quad included system type business's like internet, general contracting etc...where a system can be implemented
     
  17. Russ H
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    Russ H Gold Contributor Read Millionaire Fastlane Speedway Pass

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    Have to sideways disagree with ya there, Venom.

    While on paper this is true, precious few people who get more income are able to keep their spending at lower levels. Things that were "luxuries" when they were poor (cell phones, eating out, owning a nice car or home theater system, etc) become "gotta haves" once the money starts pouring in.

    That's why it's harder for a high income wage earner to get out of the ratrace in cashflow-- too many "gotta haves" and expensive daily habits (Starbucks, anyone?) that clog up and substantially raise their monthly outgo.

    -Russ H.
     
  18. nomadjanet
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    nomadjanet Contributor

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    I have never played the game. I guess I will never be in fast lane because I would never wan to own a busines with more than 50 employees. The amount of government regulation and meddeling in that size business is horrible. And you make less money net because of all the regulation and demands. We used to run that many guys and it was horrible, it required much more of our time because it was more difficult to manage. We now run much fewer, have management in place and make twice as much money.
     
  19. venom
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    venom New Contributor

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    Janet
    i dont think you have to follow someones elses idea of the fastlane literally.

    Russ the tech;s I work with all have those same things. They buy dvd's cd's have cell phones and collectors calling on the phone. When they are forced to move the first thing they do is still call the cable guy.
    I do realize that most of the people I work with who earn the big bucks have the second job and are still broke.
    I just think the guys with the higher salary can decide to invest and probaly has a better network then the franks of the world.
    If you look at this site I would wager that more of us have some college and a had a higher than avg job.
    Then again I could be wrong since I am still in the slow lane:bgh:
     
  20. EastWind
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    EastWind Bronze Contributor

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    Nothing wrong with a JOB, just remember that it stands for JUST OVER BROKE.
     
  21. Russ H
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    Russ H Gold Contributor Read Millionaire Fastlane Speedway Pass

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    Sorry, EastWind, that's Robert Kiyosaki ("RK") babble-- and it's a cute phrase, but it misses the point.

    As we discuss in this thread, a JOB can bring you LOTS of capital to start a new business

    "Just Over Broke" is more about living beyond your means.

    Living BELOW your means is what we like to do, whatever income level you're at.

    Living BELOW your means = money left over for other things (like investing, or starting a new biz).

    Living BELOW your means = not keeping up w/the Joneses (or the Trumps) of the world.

    And lastly, living BELOW your means = living your life on YOUR terms, not someone else's.

    -Russ H.
     
  22. GlobalWealth
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    GlobalWealth Platinum Contributor Read Millionaire Fastlane FASTLANE INSIDER Speedway Pass Summit Attendee

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    J.O.B. - jackass of the boss.

    On a serious note, there is nothing wrong with a job. I forgot who mentioned it, but there is a big difference between the person with the job who does his 9-5, comes home, eats dinner and watches tv, and in bed by 10 and the person with a job who works his 9-5 and then manages his business or investments. As the saying goes, "you make a living between 9-5, you make a life after 5". That goes for business owners and "jobbers". I don't necessarily promote the 100hr workweek, but sometimes you must put in the time to reap the rewards. If wealth were easy, everyone would have it.

    I use a friend of mine as an example frequently, but he is a good example. He is in the military, but has a pretty sizable investment portfolio as well. His military income is pretty modest, he is enlisted. He has never earned more than $40k/yr at his job, but always lives below his means and now has nearly $500k in liquid investments. He spends his time after work studying and learning how to invest and researching opportunities. He will likely retire from the military at about 45 yrs of age, but at that point will have a lifttime pension, lifetime healthcare, and likely, well over $1m in liquid assets. Maybe that is not fastlane enough for everyone, but the point is he will be essentially retired (by my definition) at age 45 and reasonably wealthy living the lifestyle he wants. And this was accomplished while having a job.
     

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