If you are looking to increase your income, increase your responsibility.

What money really follows is the value that your leave behind. The best way to leave more value behind in your job is to take on more responsibility. When you take on more responsibility, you are taking on more risk. But with the risk comes the reward.

Many people let fear of the risk keep them poor. They are unwilling to become responsible for the success or failure of a project, so they remain poor. They think they deserve a raise without creating more value. But as Jim Rohn said, “You can’t get rich by demand.” You have to climb.

The ultimate responsibility is when you are the head of the company. If the business fails, it does you no good to point fingers. You are responsible, you are the leader, you have to figure out how to fix it.

This is an empowering attitude. It says that I may be to blame if things go wrong, but I have the power to change them, to make them go right, to succeed.

If you are at a job and you want to get paid more, start looking around for more responsibility to take on.

Warning: the money doesn’t necessarily follow immediately, be patient.

For other tips for how to get ahead in your job and do better, I can whole heartedly recommend The Complete Software Developer’s Career Guide.

Keep getting wiser, stronger, and better.

If you have ever looked into time management, you have probably stumbled across the quadrant theory. The theory goes something like this.

Everything you can spend your time on can be classified as Important or Not Important. It can also be classified as Urgent or Not Urgent. Using these two distinctions, you can create four areas that you spend your time. This is usually illustrated with a box divided into four quadrants, which is where the theory gets its name.

Q1: Urgent and Important

If it is Urgent meaning there are consequences for not getting it done very soon, it often gets taken care of pretty quickly. If you don’t take care of problems in this quadrant you will start running into major problems in your life. Things like paying rent on time, turning in work assignments on time.

You absolutely need to take care of everything that falls into this category.

Q3: Urgent and Not Important

A lot of things in this category get mistaken to be in Q1. Interruptions in your day that bring no values such as unexpected phone calls from people trying to sell you things you don’t need, being interrupted to be asked a question which should have been asked of somebody else, or meetings that are useless all fall into Q3. Often these kinds of activity are why top executives have administrative staff to gatekeep for them. They realize that this category can be delegated and is a waste of time.

Q4: Not Urgent and Not Important

This quadrant has a lot of our favorite activities in it. Watching TV, playing games, and other leisure activities that bring no real value. Escapism is the word that encompasses these things. There is a place for those activities in your life, for rest and relaxation, but it should be kept small.

A lot of other time wasters are in this category as well including spam email, a lot of social media posts, and busy work that we do to keep from doing the real work that needs to be done.

Remember, this stuff is not important and not urgent. Time in this quadrant should be kept to a minimum or creatively turned into something that falls into ….

Q2: Important and Not Urgent

This is where a lot of the value and progress in your life will come from. Things like planning, relationship building, building automated systems, exercise, meditation, journaling, working on that side project or business all fall into quadrant 2.

Most of these things are not urgent, but doing them can keep other things from becoming urgent and create tons of value in your life. If you are creative you can mix some of the Q4 leisure activities into your Q2 activities.

Because they are not urgent, it takes discipline to work on quadrant 2 activities. Make sure you set aside time everyday for quadrant 2 activities.

Don’t spend major time on minor things.

Keep getting wiser, stronger, and better.

Yesterday I talked about various ways to earn more, invest, and strategies of spending less. One of the better ways to start earning more and build actual wealth is to start a business.

The more people you serve and help, the more money you will be able to make.

If you are working a job, you really can only help a few people. The primary one being your employer. You may be able to provide a lot of value but ultimately you have one customer.

A business can serve multiple people and can grow. You may provide less value to each person individually, but you can scale up to serve more and more people until you out scale your personal ability to make money through a job.

One of the reasons I began looking into starting a business is that it takes less starting capital than real estate. This may be important to you if you are planning on using your own money.

There are a few different types of businesses you can start, and I will go over some here.

Informational Business

Ideally you would want to build this business through something that provides the value, but doesn’t cost you too much after the initial creation. This is why informational businesses, training courses, and e-books have become so popular. They take specialized knowledge that cost you some time and effort to obtain, but after you create the course it can be provided to multiple people at low cost to you.

The trick is to provide real value. You have to actually solve people’s problems.

This is the style of business that MJ DeMarco suggests in his book Millionaire Fastlane, which I highly recommend.

Another form of informational business, the one MJ DeMarco used, is affiliate or lead generation sites. If you can get people’s attention, and then send them to other businesses, you can make money. You don’t have to have any inventory or product yourself other than attention and trust of your audience.

For example, lets say you have a blog that writes about hiking and camping. Your audience would probably love to know what gear you are using. See if you can find affiliate programs associated with your gear and send them through those links.

Physical Product Business

There is an untold number of actual physical things to be bought in the world. Finding something that has an untapped market or can be improved on, then selling that thing is a solid business strategy.

Often you can find a product that is already being manufactured and white label it, sell it under your brand, to find a way into the market.

There are a few courses on how to get started with this method. I can personally recommend the My Wife Quit Her Job blog as a place to get started. Another good resource is Freedom Fastlane. Both sites have a similar strategy and philosophy. I recommend watching or attending webinars from both to learn more.

A physical product business has the upside of not requiring you to have valuable specialized knowledge, but the downside of requiring a little more money to get started.

Own Your Own Job Trap

A lot of people start brick and mortar stores that are really just jobs that they own. There is not a good way to scale them to serve more than a few customers and they are trying to do everything themselves.

Avoid this trap at all cost.

I am not saying don’t open a brick and mortar store. I am saying don’t do it if you are just creating a job for yourself that does not have the possibility of turning into a successful business. For brick and mortar this means one that can expand to other locations.

It All Requires Work and Patience

Regardless of which model you choose to follow, they all require work. Your return will be proportional to your input. Your reap what you sow.

They also require patience. Often you are putting all of the profits of your business back into them for the first year to 18 months (after you start making sales). The primary reason is grow critical mass so it can become self sustaining.

I may write more about this topic in the future as there is so much to write about. This is just a brief overview and some resources to get you started on your journey if you are interested.

Keep getting wiser, stronger, and better.

Over the last few years I have been studying wealth.

What kind of people are rich? What do they believe? What do they do? What did they do?

Two Paths

There are basically two ways to start accumulating money. Earn more. Spend less.

Most people will try to spend less. That is not wrong, it is just difficult to do long term and has a limited effect. You can only reduce your expenses to zero. Zero expenses is pretty difficult, but for someone just starting out it might be possible for a time (i.e. living with parents).

Also, too many people go for small wins when reducing expenses. Cutting out entertainment, leisure, or that morning cup of coffee.

Earning more is tough. It usually requires sustained effort, increased responsibility, and often some creativity. Also, many methods of increasing your income require some financial investment. But the upside is basically unlimited.

Lets just go over a little example of the difference. If you earned $2500 per month and your expenses are $2000 per month, if you just want to decrease your expenses, the absolute most income you will get doing that, assuming you can get your expenses to zero, is $2500 per month.

Now if you want to increase your income, you can work to increase it to $5000 per month and now you have a net of $3500. And you can just keep increasing that number. It is up to you.

I recommend doing both at the same time if possible. But for expense reduction, focus on easy wins and focus on big wins (big easy wins are the best). An easy win would be canceling subscriptions that you don’t use. A big win is switching cell phone plans and cutting your cell phone bill by 60%, getting rid of car payments by selling a car that you owe on and getting one that is paid in full, moving to a less expensive apartment or smaller house, getting a roommate to share expenses with.

If you want more info on different ways to creatively get big wins on expense cutting, I recommend Ramit Seti’s blog I Will Teach You To Be Rich. His writing had a huge influence on me giving myself several thousand dollars worth of raises over the past couple years with big expense cutting wins. (i.e. I reduced my cell phone bill by $1200 per year)

Real Estate

Besides working harder on your job, there are a few different methods of earning more money. One of the big ones that I researched is through real estate.

Specifically, buy and hold real estate.

One of the keys to actual wealth is having your money work for you. Kevin O’Leary, one of the Sharks from the show Shark Tank, likes to say that he sends his little dollar bills out as soldiers to go get him more dollar bills. There is a word that describes this process, investment. Based on my research, buy and hold real estate is one of the best investments you can make. It is not easy, but it has good returns.

With buy and hold real estate you do not flip houses to try to make a quick buck. You find a house, condo, etc. in a decent neighborhood buy it and rent it out for 20-30 years, ideally with positive but possibly with neutral cashflow until it is paid off. Eventually you will want to move up to apartment complexes but probably best to start with houses. One of the most creative ways to start if you can is to buy a duplex and rent out the other side.

A few caveats about this.

First, it is good to have a property management company handling the renting so you don’t have to. From what I hear, a good company is hard to find.

Second to make the cashflow math work, you will most likely need to put a 20% down payment on the house. There are a lot of people out there selling courses on how to get started in real estate with no money down. I am not an expert on this but that method is high risk and getting leveraged like that can put you in an awkward situation.

Depending on where you live, that 20% can represent a large chunk of change. This may be a prohibitive factor for you and it has been for me.

Doing a Better Job and Getting a Better Job

Upgrade your skill set. Become more valuable. You are going to get paid what your worth. If you aren’t getting paid much it is probably because you aren’t very valuable to the marketplace.

One of the fastest ways to get an increase in pay after upgrading your skill set is to get a better job. Often companies are slow to give raises and promotions. But if you already have the skill set and another company is looking, you can often negotiate your way in at a higher starting salary.

Warning, responsibility comes before money and some things are worth more than an increase in salary. Make sure you calculate everything when considering a new position.

Anther method that a lot of people won’t use because of fear of rejection is ask for a raise. Go in prepared. Get industry numbers and comparisons and have information about why you should be paid more. If you discover through your research that you are getting paid a fair amount, you should look into how you can be more valuable.

Tomorrow I will talk about one of the other methods of earning more money, starting a business.

Keep getting wiser, stronger, and better.