Reason for Recommendation
In the book “The Millionaire Fastlane“, the author talks about:
- The author’s actual experience is quite feasible.
- A different point of view, rejecting the so-called formula for success in the world, especially not agreeing with the standard (that is, safe) view of financial influencers or financial management experts.
Three common financial roadmaps
Sidewalk
The wealth equation of sidewalk
Wealth = income ＋ debt
sidewalk approach
Modern people are constantly busy and are kidnapped by modern slavery. Constrained by the following universal concepts that are accepted as common sense in society:
- Work creates income
- Income to create lifestyle and have burden (cars, yachts, designer clothes)
- Loans incurred for lifestyle have to continue to work
Problems with sidewalks
Standard portrayal of financial sidewalks, that is: a poor person with income (in order to continuously repay loans to meet the so-called standard of living).
The slowlane
The wealth equation of slowlane
Wealth = work is the main source of income (decades of working hours x hourly salary) + Investment as a wealth accelerator (waiting for decades of compound interest)
The slowlane approach
Everyone is familiar with it. If you want to get rich, your relatives, friends, teachers, financial experts, and most of the people around you will tell you to become stronger. Here’s how:
- Pursue higher education in school.
- Find a good job in the job market and earn more salary.
- Take out a loan to buy a good house, and obediently hand over most of your hard-earned money to the bank every month.
- You can live comfortably when you get retired.
Problems with the slowlane
There are many problems with the slowlane of financial management:
- Almost everyone in the world is doing this. There are too many monks in the world, and the total wealth in the world is only so much. If it is distributed to people all over the world, how much can each person get? The wealth can be imagined.
- That is to say, if you do the same, you will not be able to achieve the freedom of wealth.
- Even if you agree with the slowlane approach and only settle for a subsistence salary; you will gain financial freedom when you retire, and you will be a money slave to the banks and the rich before retirement.
- The most important thing is that when you have financial freedom, you are already old. Because you have retired at the age of sixty-five, your mobility becomes inconvenient and you are no longer able to enjoy life.
Key points of the slowlane
In short, adopting the slowlane means accepting the fact that you must be mediocre in your life.
The slowlane is the first and most convenient exit for everyone on sidewalk, and most people will take this exit without even thinking about it.
Most of the financial experts who advocate the slowlane of financial management don’t mean what they mean, and most of them themselves are even worse off than you are, and they are simply not qualified to educate or guide others. Unfortunately, few people are aware of such unspeakable secrets after being brainwashed for a long time and implanted with wrong ideas without realizing it.
The Fastlane
The Wealth Equation of the Fastlane
Wealth = net profit (number of units sold x unit profit) + asset value (net profit x business multiple)
Note: Business multiples are the fair valuation multiples in the market for the type of industry the business owner operates. Industries with better profit-making prospects will have higher multiples. The principle is similar to the stock market’s ratio.
Fastlane approach
The Fastlane builds a better system, and in the fastlane, you build a system to serve you. On your journey to wealth, the slowlane road map of financial management allows you to endure a long and boring walk. The hard work of wealth is the process itself.
In the fast lane, wealth is driven by the business systems you create, and the hard work is in creating the systems and managing the systems.
Key points of the fastlane
The fastlane is to accumulate wealth through career, while the slowlane is to go to work and accumulate wealth through employment.
The fastlane is to take control of your own life and have the control. The slowlane leaves one’s destiny to others and is controlled by others.
Author’s life experience
The author was born in the common people and tried various ways to get rich, and finally figured out a feasible philosophy of getting rich quickly. The author has driven a taxi, done direct sales, acted as a product agent, participated in brand chains, and finally made his first pot of gold by creating a car rental website. During the dot-com bubble in the early 2000s, he sold the company to cash out.
The book “The Millionaire Fastlane” is a summary of his personal experience.
Core point of view
The slowlane is just a “job”. You use your efforts in exchange for cash paid by your employer. The fastlane is a business system that can last for a long time and “automatically generate wealth for you.”
Robert Frost once said, “Work single-mindedly for 8 hours a day, and you may eventually become a leader and work 12 hours a day.” Please consider this inspiring statement carefully.
Wealth Freedom
What is Wealth Freedom: Having the freedom to choose!
The three elements of financial freedom:
- Intimate interpersonal relationships
- Health
- Freedom
The process is more important than the result
Most people are attracted by the sensational stories of getting rich in the media, and they focus on the final wealth number, that is, how rich they are. But this is just a wrong view. We should understand the protagonist of the story of getting rich:
- How did he succeed?
- His approach
- How he did it
Don’t just look at the results, but care about the process of achieving the results. If you omit the process, you will not be able to obtain the winning formula of successful people who become rich, that is, you will lose the opportunity to learn and imitate, and imitation is the focus of the story. If you don’t understand the process, you can’t know why.
Remember: the wealth that comes with it is just a by-product; your main gain is the process. With the process, wealth will eventually come; on the contrary, without such a process, there will be no by-products.
Getting rich cannot be outsourced
This is the same view as my previous blog post “Thinking cannot be outsourced“. If you want to succeed and get rich, you cannot imitate others in your journey to wealth. As mentioned time and time again, the process of getting rich is the key to the final wealth. The reason is very simple, because if you outsource it to others, you cannot grow. If you cannot grow in your life, it is impossible to get rich.
People are lazy and hope to become a multi-millionaire when they wake up tomorrow. It is best to find someone to do the annoying details, tiring processes, and annoying brain-burning thinking. These typical symptoms are what form wealth and make you grow. It must go through a process, and no one can steal it, nor can it be stolen from others.
Hiring an agent will only keep you away from wealth and will not make you rich.
Conclusion
Find the way to grow your wealth sustainably, which is what Buffett calls a snowball. If you stick to it, long-term investment will be successful. Time, discipline, and patience are the three major elements for investment success, and none of them can be missing.
Related articles
- “Richer, Wiser, Happier“
- “Secrets of the Millionaire Mind“
- “Rich dad, poor dad“
- “The Psychology of Money“
- “An excellent book – The Almanack of Naval Ravikant“
- “Thinking cannot be outsourced“
- “Paul Getty’s “How to be rich”, by the world’s richest man in the mid-20th century“
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