The Middle-Class Investing 101 Series was super fun to write and develop. Investing gets a bad reputation among the middle class.
People believe investing is about taking all kinds of crazy risks and flying by the seat of your pants. In reality, it is the exact opposite of this scenario.
Investing is about creating a dream and a timeline and balancing the risk to achieve those results. You are in complete control of all of your decisions, so you are the boss.
- Middle-Class Investing 101: Investing is Essential for Freedom
- Middle-Class Investing 102: Budgeting to Financial Freedom
- Middle-Class Investing 103: Create Additional Streams of Income
- Middle-Class Investing 104: Building a Solid Retirement Plan
- Middle-Class Investing 105: Start with Savings & Interest
- Middle-Class Investing 106: Using Bonds to Create Safe Cash Flow
- Middle-Class Investing 107: Capture the Market with Index Funds
- Middle-Class Investing 108: Why Dividend Growth Investing?
- Middle-Class Investing 109: Create a Paycheck with Income Investing
- Middle-Class Investing 110: Create a Wealth Generator
Balancing risk in the middle class. First and foremost, having a job as your sole source of income is risky. How many sleepless nights have you had due to thinking about losing your job?
The Metaverse vs. Your Job
One of your first obstacles in the middle class is getting over the idea of “job security.” A job will keep you securely in the middle class.
However, you can keep your job while becoming an investor, real estate tycoon, content creator, or entrepreneur. In fact, I recommend this very thing.
A great book about the different revenue streams is “Rich Dad’s CashFlow Quadrant.” There are four blocks of revenue creation: employee, self-employed, business owner, and investor.
Control your destiny. The purpose of the Cashflow quadrant is to gain control of your financial future—called being an insider.
The Magic of Cash Flow
The employee. As an employee, you exercise no leverage. Your boss calls the shots; they determine your income level, pay raises, and whether you have a job.
We all start in the employee stage, but that’s not an excuse to stay there for our entire lives. We can work through the different quadrants on our way to financial freedom.
The Self-Employed. When you are self-employed (think dentist with their own practice), you have more control over your financial future. However, the government taxes you the most, and you still exchange time for money.
If you stop working, the money stops flowing. Therefore, we must create ways to continually produce income at all hours of the day and night cycle—we call this passive income.
Overcoming Limiting Beliefs 102: Investing in the Stock Market
The Business owner. A business owner makes passive income and active income. They can work their business like a job; however, the company still functions when they leave.
They can set the price of products, control the size of their staff, and can advertise or market to meet certain profit margins.
In short, they control their financial destiny and leverage other people’s time to accelerate their wealth generation.
The Investor. Finally, investors use their brains and experience to make intelligent investment decisions in real estate, cryptocurrencies, stock markets, royalties, and businesses.
The American Dream Costs $5 Million
The best investors make moves that add to their passive income, not necessarily their capital appreciation.
This means they may invest in Pokemon cards but focus on rental properties, businesses that produce residual income, and dividend-paying stocks.
Being great in the middle class. Many people fear becoming rich, and that limiting belief prevents them from achieving financial freedom.
Series “I” Bonds vs. Roth IRAs
However, with a simple shift in mindset, you can have everything you want without becoming a “bad” rich person.
Let’s take something like renting rooms. When you start renting rooms, you will think it is just a side hustle. However, you’ll soon realize that it is a business.
You can increase your profit margin (the rent you charge) by adding a better bed, an external entrance, a microwave, a refrigerator, cable TV, and streaming channels.
Suddenly your rent went from $800 to $1,000/month based on the changes you installed. You are now a “business owner” with a business mindset.
5 Takeaways from “The 4 Stages of Building Wealth”
Become an investor. Now that you have a rental room with an infinite return, you can leverage this cash flow to become an investor.
You can parley that $1,000/month directly into income-producing dividends by income investing or dividend growth investing.
My wife and I created a dividend income stream of $1,800/month by renting rooms, budgeting, and making sound financial decisions.
Now, we have a room rental making $1,000/month and a dividend stream earning $1,800. We can combine those two streams to purchase another revenue stream, like a storage shed or rental car.
Financial Independence through Real Estate 3
Take it slow or fast. You don’t have to be the greatest entrepreneur or investor to lead a great life. Take what you learn from books and modify it to your lifestyle.
I love entrepreneurship, but I still work a job. I work because providing for my family is my top priority. Eventually, my website and books will set me free, but I’m not in a rush.
I don’t use any leverage (loans) to expedite my book business by advertising or creating connections. I only use “time leverage” to create every day. I can build a business with no risk to my finances, with the trade-off being it grows slowly (organically).
Conclusion. You can have your life your way. However, you need “the information,” and you must take action.
From Dirt to Dividends 6
Start with a goal of creating $500/month outside of your day job. This is tough if you don’t want to exchange time for money (i.e., delivering pizza).
If you must exchange time for money, ensure you invest the additional resources. Eventually, you’ll earn $500/month in dividends if you invest diligently.
Do not let being middle class stop you from leading an extraordinary life. I wake up every day happier than the last because I understand the game of life.
You need money to buy your time. You use the time to spend with family. Therefore, you need passive income to spend more time with your family. Simple right? Good Luck!
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Disclosure: I am not a financial advisor or money manager, and any knowledge is given as guidance and not direct actionable investment advice. I am an Amazon Affiliate. Please research any investment vehicles that are being considered. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article. All Right Reserved Military Family Investing
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