Why become an entrepreneur
Let me ask you a crucial question. If you’re the Michael Jordan at your job — I mean nobody does your job better than you — and you bust your tail working that job and you’re as great at it as anybody, in 20 years will you be able to retire with your dream lifestyle? If the answer is not “yes,” if it’s a “no,” if you say, “my job does not offer that,” then why keep going down that same path with no light at the end of the tunnel?
Unfortunately, most people are stuck in that very predicament. Maybe they never ask themselves, “Will my job ever deliver?” They just kind of get into a rhythm, and they keep on going through the motions of life, but they never really stop and think, “My job’s never going to give me what I want.” But if that’s the case, if your job does not even have the possibility of giving you the lifestyle that you want, then you have to make a decision to do something different.
Let me paint a picture for you. One day you’re going to want to retire. Maybe you’ve been a good person. You’ve got some money to retire with. Maybe you have a spouse. Maybe there’s going to be two of you. What age do you plan on retiring? Let’s say 65, and let’s say with good medicine and with good health you live 20 more years to 85.
So picture this, there’s two of you. You want to eat three meals a day, right? So two people eating three meals a day, and let’s say you’re only having to spend $7 per meal. You’re not going out and eating real nice lobster and steak, but just $7 a meal. So two people eating three $7 meals a day. How many days a year do you want to eat? Of course, 365 days, and let’s say you’re going to live 20 years. So two people eating three $7 meals a day, 365 days a year times 20 years. Do the math. Do you realize that means you’re going to need $306,600? Almost $307,000 in the bank in order for you to be able to retire just to eat three $7 meals a day.
It’s going to cost more than you think
Here’s some sobering math. For two people to eat three meals a day during 20 years of retirement, you need to save $306,600. This doesn’t include money you need for vacations, Christmas presents and utility bills.
Now, look at your bank account. How far are you from having $307,000 ready for your retirement? Most people, unfortunately, don’t even have $10,000 to their name, much less $300,000. Do you see what I mean? You’ve been working your job for however many years and you’ve saved up how much? Are you ready for retirement? Not next year, 10 years from now? If you keep doing what you’re doing, you’re going to keep getting what you’re getting. If you’ve not saved up a lot by now, how is that ever going to change?
So why become an entrepreneur? Do you want more for your life? Is a lack of money limiting your options? Maybe you have money, but you’ve got no time.
Look, here’s the thing. Having time and no money is no good, and having money but no time is no good. Who do you know who’s got a happy balance of both? My favorite author and business coach of all time, Jim Rohn, often said, “You work hard all day at your job to earn a living, but you should be working spare time, nights or weekends, building your fortune.”
You’re working hard all day at your job to earn a living working for someone else and their fortune, but are you doing something on the side to build your fortune for you and for your family?
You should design your life with the end game in mind. If your job does not offer the opportunity or the chance to achieve what you ultimately want as your lifestyle, there’s no other choice. You’ve got to make a change. You’ve got to make a decision to become an entrepreneur.
The definition of insanity is doing the same thing over and over again expecting different results. So what I submit to you is that you’re going to need over $300,000 just to be able to eat three $7 meals per day — that’s not including Christmas presents for the grandkids. It’s not including going out to movies or dinner with your spouse. It’s not including your heat or your phone bill. It’s not including a vacation. That’s why you’ve got to make a decision to do something different.
So let’s assume I have you semi-convinced that you need to do something, that you need to start some kind of a side business to supplement your job that will have the chance to give you the result that you’re looking for. Let me share with you the book I wrote called “Money Mindset.” My book went No. 1 on Amazon very, very quickly. Why? Because money is an important topic. A lot of couples fight about it. A lot of people are stressed about it. Most people don’t know how to attract money. They don’t know how to keep the money that they make. They don’t know how to grow the money that they make.
So my hope is to share with you the three forms of income that I wrote about in my book. The first form is linear income. Linear income is basically trading your time for money. You could be working at a fast-food restaurant making $10 an hour. You could be making $100 an hour as a massage therapist. You could be a $400-an-hour attorney. You could be a surgeon who makes $20,000 per surgery. If you do the work, you get paid. If you don’t work, you don’t get paid. You’re trading your time for money. You eat what you kill, and in that scenario, which is what most people who are W-2 employees are used to, that’s how most people are living — trading their time for money.
The second form of income is called leveraged income, which is when you incorporate the efforts of other people to generate your cash flow. Would you rather be the real estate agent or the broker? The insurance agent or the broker? You or your boss? The people who have people working for them make the most money and they tend to have the most time freedom.
I was fortunate to be raised by my father who understood and taught me a business principle that most people in this country go to their grave never figuring out. He said, “Brian, you go out and sell a house and make a bunch of money.” But he said, “Would you rather work hard or would you rather work smart? Wouldn’t you rather be the real estate broker and have hundreds of agents working for you and get a little piece of action off of their sales?”
So, again, you can have leveraged income, you can go out and sell a house yourself and get paid, or you can be a broker and have a bunch of people creating leveraged income for you.
The third way you can generate income is residual income. This is my favorite form of income. Residual basically means you do something one time, yet you get paid over, and over, and over, and over again for what you did once. I’ll give you a couple of examples. An insurance agent sells you a policy. They get a big commission check up front. But then every year that the policy renews, even if they didn’t even talk to you, it might automatically renew. They automatically get paid that renewal or residual income. Brilliant, isn’t it? Most people don’t have any experience with residual income.
Elvis Presley is one of the highest paid performers in America, still to this day, decades after he’s been passed away and gone. Why? Because he recorded a song one time, and then every time it airs, his estate gets paid. Same with Michael Jackson. He’s still one of the highest paid performers in the world. He recorded a song one time, every time it plays, his estate gets paid.
So I encourage you do your exploration. Find yourself a side business that has all three forms of income: linear income, leveraged income, and residual income. Truth be told, this is my soapbox topic. I would not do anything else the rest of my life if it didn’t have leveraged and residual income attached. If 100 percent of your income comes from 100 percent of what you do, in my book that’s called scary. What happens if you get sick, can’t work, want to retire? God forbid you lose your job. What would happen? Leveraged income and residual income are not predicated on you doing work anymore. You can still keep on getting paid.
“Find yourself a side business that has all three forms of income: linear income, leveraged income and residual income.”
Have I convinced you to start your own business? I believe there are four steps to get started. Number one, open your mind. Number two, evaluate opportunities. Number three, find one that really resonates with you. And then number four, make an informed decision and get going.
Okay, so now let’s talk about the three different paths you can take to start a business. First, you can invent something. Are you an inventor? Do you have some great ideas floating around in your head? So, let’s say you want to invent. The challenge with being an inventor is it’s high risk and high return. Most inventors lose their money. Most inventors never get their invention off the ground. So, it’s high risk, but if it does pop, it has a high payoff.
The second option to starting a business is to buy into a franchise. A franchise is a proven business. It’s already got a proven model. Other people are already out there doing it and making some money. It’s low risk, but it’s also low return. You’re going to put up “X” amount of money and you’re going to get a predictable return back. You’re probably going to have to invest about $500,000 of startup capital to be able to generate maybe $100,000 a year of income off of that one location. So, an inventor, high risk, high return. A franchisee, is low risk, low return.
But now let’s talk about the third — and what I feel is the absolute best option — a home-based marketing business, because it’s low risk (sometimes no risk) and super-high return. Here’s the thing, you already have a proven model that’s succeeding in the marketplace. There’s not much startup capital to get it going, and the upside potential is unlimited.
So, let’s recap that. You invent something — high risk, high return if it works out at all. A franchise — low risk, low return, but it’s going to take a lot of startup capital to get it going. Or a home-based business in the marketing space — low risk and unlimited income potential. That’s why I chose option three to base my career path. It’s panned out to be a massive success for me, and it could be the best chance of success for you, as well.
Whoever solves the biggest problems makes the most money. Your goal right now should be to find a company that’s solving a major problem that many people have, and if that company has a proven track record, and if you can believe in the product and its value, then allow yourself to get excited about it.
When you buy somebody’s opinion, you buy their lifestyle. So, let me warn you right now. When you make the decision to start your own business, all your W-2 friends are going to come out of the woodwork and tell you that you’re nuts. Unless you want their lifestyle that they’ve settled for, don’t pay attention to their opinions. There’s something magical about building your own empire. Even if you only have 30 minutes to an hour a day to spend on it, you’re going to feel a new exuberance for life because you’re building something for your family instead of making someone else rich.
Becoming an entrepreneur gives you the best of all worlds. You start off part time, which does not interfere with your job or your busy schedule. You already have linear income, but now you’re adding leveraged income and residual income to your life. You’re not going the inventing route with high risk, nor by going the franchise route with low return — but rather the home business route with little to no risk and unlimited earning potential. That’s a virtual perfect scenario, and all my fellow business experts agree.
Down to Business
Not all businesses are created equal
Three options for starting a business include being an inventor — which is high risk and potentially high reward (but most likely, no reward). A second option is to open a franchise. This is low risk, low reward. A third option is a home-based business, with low risk and high reward.