As wealth builders and entrepreneurs, we have a few strategies we can employ when seeking to build our wealth portfolio. A central theme that underlies all the paths to Wealth Creation is ownership. Yes, ownership. Your ability to own assets that generate money is where wealth building starts. Specifically, Owing assets that earn you money while you sleep. Is there anyone you know who is wealthy but does not own income-generating assets? The idea here is to own less depreciating assets such as iPhones or cars but more income-earning assets such as Government Bonds. All wealthy people own a lot of assets and thus ownership should be a central focus in your decision-making process on wealth.
Why Working your way to Wealth doesn’t Work?
Why you cannot work your way to Wealth is because you don’t own what you produce. When you work as a salaried worker, you are trading your time for money. What you have produced is not owned by you. Unfortunately, humans don’t scale, so you are limited to what you can earn. You will always be limited by the time you have.
Wealth Building Vehicles
Let’s now talk about the various vehicles we can use in acquiring wealth through ownership. Ownership as a vehicle in building wealth comes in many different forms. These include
- Rental Systems,
- Computer Systems,
- Capital Systems
- Content Systems
Rental Systems
Real estate as an investment vehicle is very popular among almost all wealthy individuals. Having a home is essential to our lives and well-being. There is almost always a housing deficit in this country. Real estate investment can also last for generations.
The problem with real estate investments is that you need to make the money first. You have to have a large sum of money sitting idle before you can begin your journey of ownership. The barrier to entry is huge.
Computer Systems
Examples of computer systems include Internet and software businesses. There is high growth potential in this area. New apps spring up every day and many tech entrepreneurs have become Millionaires in their early twenties. Some high-profile individuals are the Snapchat brothers.
Knowing how to code and being able to develop a world-class app that people use can make you millions. However, we all cannot become programmers or create great apps such as TikTok or Snapchat. Again, there is a barrier of entry due to the level of education and dedication you need to create apps at that level.
Capital Systems
These include investments in Government Treasury Bills and Bonds, Stocks, Index, and Mutual funds. This is the most passive of all the investment vehicles. It is literally a set-and-go kind of option. I have expanded on the options to get started in capital investments in my post – How to beat inflation in this Covid Pandemic.
However, to be part of this system you need to have the money already generated. You need to have savings and build from there.
Content Systems
The final path of Wealth creation content systems is the least capital intensive option. It is also the option with the lowest barriers. It also affords ownership and has the potential to scale and generate millions. Content systems include authoring ebooks, Online video courses, YouTube videos, blogging, and magazines. Content options require little to no capital. Your phone can record, help you write, and help you upload your digital products. You really can start now. There is no one to ask permission from.
To wrap up, every wealthy person owes a lot of revenue-generating assets. More wealth is generated by assets that earn money non-linearly. Thus ownership is a necessary concept to understand and implement if we are interested in building wealth. You must own assets that earn you money. Specifically, own assets that earn you money while you sleep. We have explored a few options above. As usual, you can always pick and mix to achieve your own wealth-building portfolio.
Until next time wealth builders, let’s build wealth!
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