Making Money vs Growing Money

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Tayo Oyedeji, in a series of tweets, shared the difference between making money and growing money. This article highlights the four simple models for making money and growing money.

People get in trouble when they try to make money from a model designed for growing money.

There are two key models for making money:

1. Competence and Skills

People pay a lot of money to hire competent and skilful people. The primary way to make money for most people is by developing complex, marketable skills. You develop some skill(s), find a buyer (employee) and sell your skill(s) + time. Complex skills are more marketable and expensive than mundane skills

For instance, I once charged a fee of $10,000 for less than a full day of work for business operations consulting for a big firm – Operations Management is a relatively rare skill. Do a quick audit of your skillsets. Can they earn you a good income? If not, what additional skillset do you need to build to earn a premium? Most people are lazy: they will not invest the time to build new skills.

In today’s world, technical skills are more expensive than non-technical ones.

My Artificial Intelligence mentor was a music composer who went from $25,000 a year to $150,000 in 12 months.

He still plays music but is now a data scientist at @EpicSoftHosp.

2. Hustle & Flow

Many people are not wired for technical competence. They, however, have natural business skills that can help maximize their income. Others have both. They can hold down a regular job while hustling on the side. I have always done both. I sell competence during the day and hustle at night.

Most employers will not pay you more than you need to live a decent life. To make more money, you will need to build a side gig that will multiply your income.

There are also two key models for growing money:

1. Frugality & Saving

If you make $1m and spend $1m, the money just passed through you. You are not wealthy. You’re just a money conduit. On the flip side, if you make $2,000 a month and keep $500, you just grew your net worth by $6000 a year.

The first way to grow money is by living below your means so that you can save some.

1. Don’t buy crap you don’t need.
2. Sell anything you haven’t used in a year.
3. Don’t impress people with things, impress them with your investments.

2. Investment & Equity

This is actually why I decided to write this. Many people hold a misguided view that investments and other money-growing models are the paths to making money.

Let me debunk that notion:

Investments are for growing money you have already made.

This erroneous notion is why people fixate on dubious/questionable ways to make money – gambling, Ponzi schemes etc. The promise is that you can make a lot of money with a little amount of investment.

The models for making money are skills and competence (employment)/hustle and flow (business). Frugality grows your savings and investments accelerate the growth.

Learn to create value & make money first. You can only grow what you have made. If you try to make money with a money-growing model, you will chase risky propositions and lose money. You can invest in mutual funds, treasury bills, company shares, and other investment opportunities.

The way to make money is by creating value with your skills or business. Then you save some and grow it with investments.

Make it with models for making money and grow it with models for growing money.

Don’t try to switch the two models.

Start growing your money today.


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