How to get more wealth with less work?

How to get more wealth with less work

Most people focus on one thing in particular when building wealth: making money.

Unfortunately for this very reason they remain below their financial means.

Because many people are so busy with their jobs that they lack the time and nerves to look after their hard-earned money. They go out of their way to make more, but their money does a lousy job.

Invest 4 minutes and you will see how smart wealth creation really works.

"If you work all day, you don't have time to make money."

- John D. Rockefeller

No nerves

High-volume workers and earners often flirt with the slogan "If you work a lot, you have no time to spend the money". But is that really true?

In any case, my need to get the money out among the people was astonishingly closely linked to my weekly workload in the past.

Because those who are “very busy” and / or dissatisfied with their work situation constantly have the feeling that they have to compensate themselves for the demands of working life in their limited free time.

Whether it's luxurious vacations, high-priced clothes or a new car - I'm not indulging in anything else!

Social psychologists describe this behavior using the model of ego depletion, which I already mentioned in connection with investment advice. Accordingly, the ability to control oneself is dependent on willpower and this is a finite resource. It is exhausted when - as is not infrequently the case in professional life - it is used excessively.

The higher the stress level, the more difficult it becomes to postpone rewards and to forego consumption. Stressed people have a harder time saving.

In addition, they hardly have time to think about their consumer behavior. After all, 99 percent of your thoughts revolve around your job.

No time

Hardly any free time and then you have to deal with boring things like investing? In case of doubt, the money remains in the current account (without interest) or in a call money account (interest below the inflation rate).

If you care, you can speculate a little on the stock market. It's just a few clicks online - you can do that quickly in the evening. Who knows, maybe colleague X's tip to buy share Y now is really the best?

Or you simply delegate the whole thing to an “independent” financial or asset advisor, after all, they are “experts”. They'll already know where the money is best kept. The typical investment behavior of frequent workers is accordingly often either

too conservative (hardly / no return),

too speculative (increased risk of loss), or

too expensive (consultant commissions reduce returns).

That's not particularly smart. Wouldn't it make a lot more sense to let the money do some of the work instead of messing yourself up to the point of exhaustion?

The advantage: If you invest your money cleverly, it will generate passive income. So you can take it easy while earning.

In addition, you reduce the risk of ending up with empty pockets. There is something else that speaks in favor of not just concentrating on making money: risk diversification.

Minimize risks

Wealth formation is based on three levels:

3 levels of wealth creation

Only when these three levels, which build on one another, function together, can wealth be built. If you don't earn anything, you can't save and if you don't save, you have nothing to invest. Sounds logical right?

Different risks lurk at all levels:

1. Earn

Financial Risks: Employees run the risk of losing their job, entrepreneurs the risk of going bankrupt.

Health risks: Those who work too much put their health at risk. Furthermore, he also runs the risk of missing out on life.

2. Save

Shortfall risk I: Those who consume a lot today can save little accordingly. The risk is that later on there will not be enough money available to be able to maintain the usual standard of living.

3. Create

Loss risks: Depending on the investment strategy, fluctuations in value, inflation, exchange rate, default, interest rate changes and other risks must be taken into account.

Deficit risk II: even if you save a lot, there is still the risk that your assets will not be sufficient to maintain your standard of living if you invest too conservatively.

The overall risk can be reduced by not letting individual risks become too great.

Those who work less ideally feel less buying impulses, which leads to a higher savings rate. And he has time to deal with the subject of investments.

keep the balance

If you want to strengthen your muscles, you can do it in different ways. One of them is to focus entirely on lifting heavy dumbbells while lying on your back - also known as the bench press.

If you've ever lost your way in a fitness studio, you will certainly have admired the sad "successes" of this training method: an oversized upper body on legs that are much too skinny.

When it comes to wealth creation, it is the same as concentrating solely on making money and neglecting the other levels. Just like in sport, not only strength (money), but also endurance (saving) and coordination (investment strategy) are required.

You can only achieve your maximum potential when all three levels of wealth accumulation are in balance.

I've got to know people who have earned millions in their professional lives and in the end were left with nothing because they “speculated” or lived on a large scale.

If you have your consumer behavior under control and invest your savings cleverly, you don't have to earn huge amounts and work non-stop to secure your standard of living in the long term.

If you spread the risks evenly and use your time, physical, and financial resources as efficiently as possible, you will achieve more assets with less work. 

How do you approach wealth accumulation? Do you have enough time and peace to deal with your finances? I'm looking forward to your commentary.

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