I spent over twenty years thinking like a government employee. There is nothing wrong with working for the government and providing for your family.
However, although the wages were reasonable, my financial situation stayed the same from age 18 to 38; I always seemed to be in debt or broke.
My wife and I are not extravagant spenders, so why couldn’t we ever get ahead? The answer lies in the fact that we didn’t understand money.
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Once I started thinking like a capitalist, we bought our financial freedom rather quickly. We retired at ages 42 (me) and 39 (her). Here’s how we did it.
What is a capitalist? Here is my definition of a capitalist: Someone who uses capital markets to gain a better financial position.
What are capital markets? Anywhere that you can earn money outside of a W-2 job. The more you learn to make money outside of a job, boss, resume, or interview, the bigger capitalist you become.
Here are some capital markets: real estate, stocks, bonds, options, foreign exchange, commodities, cryptocurrencies, and business.
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Real estate. Everyone loves real estate because they own a home (or want to). To leverage real estate, you must understand interest rates, mortgage rates, construction costs, and cash-on cash return.
Stocks. You can make or lose a lot of money in the stock market. I invest for dividends, but this takes a certain temperament that you must learn.
Bonds. The bond market is many times bigger than the stock market. You can buy and trade bonds and Treasuries or just find and keep high-yielding ones.
Options. Trading options can be highly lucrative or dangerous, depending on your emotions. With the right mindset, you can make a decent amount of passive income.
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Foreign exchange. Trading foreign currencies requires lots of leverage. I have a young buddy who made over $2 million in the FOREX markets.
Commodities. Commodities are a tough market, but can be exciting. You can also purchase oil or mineral rights to receive passive income from royalties.
Cryptocurrencies. Crypto is down badly, but it’ll be back. The idea of people moving their money away from banks scares governments, but it is inevitable. You just need to position yourself for the next bull market.
Business. Anyone can start a business, but most fail. To create a business, you must first become an entrepreneur, meaning understanding the idea of adding value.
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Why become a capitalist? Most people fear becoming a capitalist because of negative experiences that they went through during their school years.
Becoming a capitalist requires a lot of reading, writing, and arithmetic (the three R’s). It is much easier to punch a time clock at work and have someone control your life.
As you dive further into capitalism, you’ll see a path to wealth beyond being an employee. Time is your most valuable gift, and having the assets to perform your work is much more conducive to a healthy lifestyle.
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A capitalist versus an employee. You won’t understand what being a capitalist is until you overlay it atop your lifestyle.
Let’s say you earn $200,000 a year in San Diego, which is good money. You can’t imagine making this much money without having a job.
But how much of the $200,000 do you waste on things you don’t need? What is your actual bare-bones budget?
You do the math, and you can live on $60,000 per year in Alabama. You sell your house in San Diego and purchase one for cash in Gulf Shores, Alabama.
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Your first goal is to earn $5,000 monthly to cover your living expenses. You start by using your equity from the sale to buy dividends.
You build a dividend portfolio that pays you $2,000 per month. You then add two mobile homes to your property, which brings in $1,000 per month.
Finally, you purchase three Tesla Model Xs that you rent on Turo for a total of $2,000. That gives you $5,000 per month; now, you are ready to become a genuine capitalist.
The path to financial independence. Did you see what I did there? Before focusing on becoming a capitalist, I bought our freedom from the workforce.
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I got this idea from Robert Kiyosaki in “Retire Rich, Retire Young.” Once you buy back your time, you can truly create the life of your dreams.
Society wants you to take the slow road to financial freedom. This consists of working 40 years while investing 10% of your income.
As we know, most people never become free using this method. They simply retire and rely on social security to fund their lifestyle.
As a capitalist, you are in control of your destiny. However, it’s difficult to become a capitalist when you have a ton of bills and a high cost of living.
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If you try to become a capitalist and earn $200,000 without a job, you’ll be in for a rough road. The more reasonable path is to reduce expenses, create passive income, and then focus on capitalism.
Having a big dream. It’s tough to be a successful capitalist if all you want is money. Trust me; there is a lot of money to earn on this side.
Unfortunately, money cannot be your driving factor; there must be a higher purpose. I trade options to ensure my family has resources when needed.
I own three homes because my children already have the most expensive part of their lives covered. I use my dividends to supplement my retirement and ensure I don’t need to return to work.
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When you use leverage, the numbers continue to grow. If you are not doing it for the right reasons, greed can blind you.
Conclusion. Many people quote the bible and say becoming rich is horrible and forbidden. However, the bible says “the love of money” is evil.
Your family doesn’t need to struggle because you are scared to become wealthy. There is enough wealth to go around; you just need to see it.
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Yes, becoming a capitalist involves taking some risks. You may lose on certain ventures. But everything is a learning experience.
If I can sell books on Amazon, I am convinced anyone can do anything. If you are tired of being broke, behind, and bullied, it’s time to make a change.
Few people take the time to learn how to be a capitalist. It seems daunting, but take it slow. The first step is reading books (I recommend “Unfair Advantage”) and finding your “why.” From there, things will start to fall into place. 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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