Don’t Work Hard for Money 2; Work for Income-Producing Assets

Why do you go to work? Is it to pay bills or provide for your family? Do you go to fund your kid’s college tuition or purchase a home?

These things are noble but may not get you the desired results. In fact, there is truly only one reason to work—at least at first.

Why you should go to work. The only reason to work is to obtain income-producing assets. These assets will then produce income (duh!).

Being Mediocre is Not Okay

As your base of assets grows, you can choose what you want to do for work rather than what you need to do. This line of thinking contradicts how most of our parents raised us.

We have many takeaways from the workforce along our journey. I joined the Marines in 1999 to serve my country and push myself to the limits.

I didn’t learn about obtaining assets until twenty years into my career. At age 38, I had to make a hard pivot to ensure I made the most of my work paychecks.

Robert Kiyosaki says you should work to obtain skill sets—I agree. The Marines gave me a level of confidence I couldn’t have gotten anywhere else.

However, every dollar we earn should have a mission to multiply itself. The only way to create money from money is to become a capitalist.

The Pros and Cons of Closed-End Funds

Become a capitalist as an employee. A capitalist needs two things to build wealth: a business mindset and capital.

As an employee, building the mindset of a capitalist will take a lot of work. They taught us to work for money. We only know how to receive paychecks from a W-2 employer.

The worst part is that they teach us to fear other forms of income. The central lie is that you should never become a landlord.

They also tell us to fear the stock market and that we can never write a book or become a YouTuber. These are all lies.

They tell us to depend on our employer for all our income needs. But what if we get fired or downsized one day?

The Six Types of Income Investing

I want to lay out some steps to help you slowly convert your mindset to that of a capitalist. The best part of being a capitalist is that you can decide your level of risk. Let’s begin.

Let’s become capitalists. Remember, we only work to obtain income-producing assets. The most accessible asset to purchase is dividend-paying stocks.

Let’s say you earn $60,000 per year after taxes, which is $5,000 monthly. Do you have $200 or $300 to invest?

If not, you must learn the first rule of being an entrepreneur or businessperson—keep your expenses low. You should run your home like a business.

Stock & Bond Investing in Your 40s

If you have trouble generating additional income to save and invest, then you need to consider your spending and lifestyle.

Part of the investment process is making massive sacrifices to obtain wealth. Earning $5,000 monthly is a good chunk of change, but you must be wise.

If it’s not enough, do something different. Get a roommate. My wife and I did that to create enough cash flow for investments.

Go line by line on your budget. Where do you spend your money? You can treat yourself, but you should have a budget for your vices.

Saving & Investing with $500 per Month

Do not let your friends or family convince you to stay on the same course. Obviously, something isn’t working. Get a roommate, move in with your parents, drive Uber, create content, sell your car, or cancel all your subscriptions—do something!

Buying stocks for income. Most people enter the stock market under the “bigger fool theory.” The theory states that I buy something today so someone can purchase it for me at a higher price later.

However, only some of these styles of investing produce income. The only reason to work is to obtain income-producing assets, so let’s do that.

I like to use the Cash app to purchase dividend-paying stocks because the dividends go straight to your Dividend Debit Card.

Are You Drowning in Debt?

Let’s say after a year of reducing expenses and debt, you have $300 per month to invest. I laid out a plan in the article “Your First Five Dividend Stocks.”

In a nutshell, I would purchase stocks like Altria (MO), Philip Morris (PM), AT&T (T), Verizon (VZ), Ares Capital (ARCC), and Prudential (PRU).

If you invested $1,000 in each stock over time, here is what your dividend payments would look like today. 

1. Altria (MO)- 23 shares, $22.94 quarterly dividend.
2. Philip Morris (PM)- 10 shares, $13 quarterly dividend.
3. AT&T (T)- 57 shares, $15.96 quarterly dividend.
4. Verizon (VZ)- 25 shares, $16.75 quarterly dividend.
5. Ares Capital (ARCC)- 48 shares, $23.04 quarterly dividend.
6. Prudential (PRU)- 9 shares, $11.70 quarterly dividend.

I picked this set of stocks because you will get two of the six payments per month. 

1. MO and PM pay in January, April, July, October—total payment: $35.94.
2. T and VZ pay in February, May, August, November—total payment: $32.71.
3. ARCC and PRU pay in March, June, September, December—total payments: $34.74.

Earning $35 per month for having $6,000 may not seem like a lot, but it is a way to free yourself from work. If you keep at it, you will eventually have enough income to pay all of your expenses.

Free yourself. Once I discovered dividends and other income-producing assets, I became obsessed. Luckily, I read a book encouraging my passion for achieving financial freedom: “Be Obsessed, Or Be Average.”

The Magic of Waking Up Early

I remember earning my first dividend from Papa John’s (PAPA) for a grand total of $0.25. It was magical, and I love my dividends even more today.

From those humble beginnings in 2019, we now earn $2,000 per month in dividends. We can actually pay our mortgage with dividends ($1,700). 

That means that these beautiful companies are funding my living arrangements. I can’t complain. In fact, I will keep adding more dividends to the pot until the very end.

Conclusion. Find your passion. Working towards a goal outside the office will give your work more purpose.

Learn to Barter and Trade Today

Going to work and paying bills has become tedious; I know this because I did it for over 24 years. But my passion sparked when I found dividend investing.

I also rent properties, trade options, and create content. This additional income allows me to purchase more income-producing assets.

Imagine a world where I live entirely on dividends. I have enough dividend income to purchase more rental properties, stocks, bonds, and businesses.

There would be no reason to work a traditional job because I would have a passive income stream. I aim to keep building my base of assets as I live my dream life.

Now, imagine I can pass on this fabulous lifestyle to my kids. I can teach them how to save, invest, and produce income passively.

Now, they can focus on their dreams, such as creating music, traveling, or having lots of kids. Whatever their desire, we can make it happen with passive income from assets. 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