DataDrivenInvestor
Feb 22
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Ways to Make Money
Almost everyone on this globe makes money. The methods may vary but fundamentally everyone makes money because we need to do so to survive.
Dan Loke provides insights into these 4 methods of making money.
You may have previously heard of Dan Loke, especially if you're big into finance and wealth creation. He is one of the top guys when you think of finance gurus like Robert Kiyosaki, Grant Cardone, Dave Ramsey and etc.
He provides a refreshing take on the ways to make money although not initially apparent to most people. It is insightful to understand where your time and effort is being allocated for you to get the highest return of money to you.
These 4 concepts may seem simple but it helps you focus on where you should be targeting your time, energy, and efforts to make your money work for you.
You can make money by either working for an employer or for working for yourself. The main thing is that you are trading your time for money. This is even true for those high-income earners like surgeons, lawyers and bankers. You are essentially making money by working.
As a worker there are only 2 ways that you increase your level of money:
Sounds pretty simple right? When you work overtime, you get more billable hours that you can charge the client, hence you earn extra for those few extra hours of overtime.
When you have new skillsets, qualifications, or capabilities you increase the level of income you earn. In the book “Rich Dad, Poor Dad”, Kiyosaki talks about employees going back to college to get more qualifications and certification so that they will get a higher salary. Additionally, if you have the ability to perform well, you will be entrusted with a higher role which hopefully provides you with a higher salary, bonus and raises.
You are essentially trading your time for money.
The second way you can make money is by selling.
Selling things has been around since the beginning of days. In the early years, people used to barter an item for another item. For eg a cow for 5 chickens. You get the idea.
You can make money by selling goods or services.
When you sell items this does not depend so much on your time.
Your time doesn't become that much of a limiting factor to your earnings when you make money through selling.
The thing to know is that how good you are at closing a deal (selling ) depends on:
This is why if you want to generate high income as a closer, you need to focus on high ticket items. Why is that? Well, because we know we can get to a higher significant income with fewer transactions.
You can also make money by owning things.
By merely owning these income-producing assets the owner is generating income. Other examples include owning rights to a movie or song the owner earns royalty and commission income. A person who owns stocks makes money through dividend income.
Another way that you can make money is by lending.
Interestingly you can make money by not having to :
You can make money when you lend money either as a:
When you are a lender (investor) you basically invest your capital into the business and you get returns in the form of debt repayment or equity capital. Think of shows such as Shark Tank and Dragon’s Den, the investors are investing their money and hopefully getting a return on their investment by the dividend payment through owning equity in the company, or debt repayment, or royalty fee charged on every item sold when they invest their money into a business. Hence, as an investor, you make money by lending money.
Next, you could even lend money on peer- to peer (P2P) platforms to generate interest income through lending platforms like Lending Club or Prosper.
Having an awareness of how to make money can be really eye-opening especially when you realise that you have a limited amount of time in a day. Hence, to really live your best you want to make sure your time and energy work most optimally for you to generate the highest income return for yourself.
This allows you to strategically retarget your focus, energy, time and efforts towards high ticket items and high-value tasks that help move the ticker scale as opposed to merely working harder on low tickets items and low-value task that does not contribute to moving the ticker scale and generating income.
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