A Few Simple Steps to Building Wealth

Posted: Jun 13, 2005 12:00 AM
Most people sleepwalk through their lives, hauled along by some middle class inertia that compels them to go to college, get a steady job, and then hunker down long enough to establish retirement benefits. This kind of thinking makes sense. It?s important to go to school, and to keep retirement in mind. But merely doing these things tends to make people risk adverse. For example, being told all of your life that you need to take certain steps to secure financial stability makes people hesitant to learn new things. It makes them scared to buy several properties instead of one, even though using any number of government loan options to buy a few wisely chosen properties is the safest investment anyone can make. The problem is that our middle class inertia focuses us so much on basic foundation issues (i.e., getting a degree, house, retirement) that we are conditioned over time to expect the ordinary, and to keep our horizons dim.

It doesn?t have to be that way. There are some very simple steps you can take to build extraordinary wealth and to enjoy true financial freedom. The first things you have to do are break out of that middle class inertia and believe that you can achieve more than the ordinary. Next, you have to be willing to duck your head and burrow forward. The greatest job I ever had was working on my family farm. Each morning my father would come into my bedroom around 4:30 am and command me to get up and work the fields. I would spend the next two hours before school slopping pigs and cropping tobacco. Was it fun? Not even close. But these early lessons in physical striving taught me discipline, work ethic, routine, and responsibility and instilled an attitude of achievement that would, later in life, propel me past the lethargic others. My point is, if you want to achieve anything in life, it is not enough to merely wish for it. You must develop that kind of 4:30 AM discipline that distinguishes you from others.

Ok, so you say you?re ready to work hard and build wealth. First, you need a plan. It?s too easy to drift from one whim to another. Unless you set your sights on a specific target, your effort will be dispersed in too many different directions, and ultimately wasted. Motivational speaker Zig Zigler tells a great story to make this point. He observes that the greatest archer in the history of the world can?t hit a target if you blind fold him and spin him around before he shoots. Get it? If you don?t set your sights on definite goals, you?ll be misfiring all over the place.

Now, one thing I tell everyone is learn about real estate. Repeat after me: real estate provides the highest returns, the greatest values and the least risk. And because the U.S. government wants to incentivize real estate investment, tax laws will always be geared to ensure that trend continues. What you have to understand is that if you make a wise investment in property, it doesn?t matter as much where the market goes because you are probably assured a profit over the long haul. There are a host of tools to make owning real estate easy, ranging from government loans and seller financing to discount mortgages. You just have to be willing to invest over the long haul.

What if you don?t know anything about the real estate market? That?s OK. There are plenty of people out there who have dedicated their lives to this field. It?s now your job to go out and tap these resources. That?s right, I am talking about networking. You must develop personal contacts if you want to be successful. In his book, Building Wealth, MIT economist Lester C. Thurow writes that "Knowledge is the new basis for wealth.? Lester is right. We live in a time of incredible opportunity. We are not enmeshed by class limits. Riches are not merely cosigned to a few families. Everyone can build wealth. So everywhere you go should be an opportunity to meet experts in a particular field such as real estate, financial planning, etc.? who can help you achieve your dreams.

Networking is an essential part of building wealth. For example, one of my former employees is currently at law school. He recently decided to volunteer at the school?s career counseling center. Did he do this because of a burning desire to help other students acquire their dream jobs? No! He did it because it offered an opportunity to make contact with people in his field who could help propel his career forward. Each day he calls practitioners and invites them to school speaking engagements. After their lectures, he mentions how much he enjoyed what they had to say, and he requests an informative meeting to learn more about the filed. He doesn?t ask for a job or for money. He just asks every practitioner he meets if they would be willing to share some of their background and expertise so that he can map out his own career path. The practitioners are inevitably flattered and agree to talk. In his first two weeks of volunteering he has already received five job leads for summer clerkships. You need to do the same! Volunteer at local associations. Get involved in the community. And meet experts who can teach you what you need to know about a field of interest. This doesn?t mean go out and beg for a job or money. It means making an effort to engage successful people in conversation. It?s tremendously flattering to be asked to regale others with your own exploits. If you show sincere enthusiasm for what an individual does, he will likely take time to point you in the right direction. Instead of asking them for a job, ask them what traits are crucial to success in that field, or what resources you should look at to learn more. The key is to put yourself in a position where they decide either to mentor you, or to point you toward additional resources that can be of benefit.

First hand contact is also a great way to get your ear to the ground. It?s one thing to read about the real estate market. But it?s quite another to find out about a proposed development deal and being able to invest before the property value sky rockets. You can?t squander the advantages of networking. Bottom line: if you show a genuine interest in learning about how others became successful, you can open up a world of opportunities.

These wealth-building opportunities are available for everyone. They do not require specialized skill. They just require entrepreneurial resolve and willingness to network. Once you achieve that, you will be well on your way to the life you?ve always wanted.