Those who are most likely to become millionaires through being self employed are those individuals who are masters at increasing what we call their “personal stock.” Like a stock, each person on this planet has a value, and this value is tied to their knowledge, skill, reliability, and discipline. Those who thrive in all these areas are said to have a very high stock value. In Hollywood, the difference between A-list actors and B-list actors is that A-list actors have a much higher stock value, and can command much higher salaries as a result. They've demonstrated in their movies that they have a style and flair which is unique, and which can allow them to bring huge amounts of money into the box office, and directors and studios clamor to them as a result.
The key reason why most people working at “normal” day jobs have an average to below average income is because they have very low personal stock values. They get paid low wages because their skills don't command a higher salary. This has more to do with the laws of economics as opposed to any manipulation on the part of the management. The reason why electrical engineers earn much more money than cashiers at McDonald's is because the engineers must spend years in school, their skills are not easily developed, and not anyone can come off the street and do their jobs.
In contrast, almost anyone can be taught how to run a cash register at a fast food restaurant within a short period of time. As a result, they are paid a very low salary. To succeed in the self employment arena, you must increase your stock value, and to do this, you must gain specialized skills. Those self employed people who work in specialized fields tend to make a lot more money than those who are more generalized. As the old saying goes, “he who tries to be the jack of all trades is often the master of none.”
To become rich, not only must you have a specialty, but we recommend having a specialty within a field. Many careers are very broad, and there are specialties within them. For example, when someone tells me they want to work in the field of computer animation, I often wonder in which area of animation they want to work in? There is texture mapping, character modeling, lighting, animation, and environmental effects. Instead of trying to become a master of all these areas, why not become a master of one? Why not become an expert animator, or an expert texture mapper, or a leading character modeler?
Of course, you will need to have some knowledge in all these areas, but my point is that those who become really skilled in one specialty within this trade can command even higher salaries. Another key in becoming rich as a self employed person is to develop your own unique “style.” When you look at the entertainment business, every successful entertainer has a style which allows them to stand apart from the crowd. Those individuals who borrow too much of their style from others are often ostracized and end up becoming failures.
If there is one word which can best describe the advantage of being self employed, that word is “control.” Self employed people tend to be more successful than those who are employees because they have more control over their lives. The less control you have over your life, the less freedom you have, and vice versa. By becoming a self employed freelancer, you make the decision to gain control over your life, and you will be greatly rewarded as a result, so long as you do things in the proper sequence, which is what this book is designed to teach you. Below is a simple statement which lays the foundation that can allow you to become rich. This statement is:
Employee > Self Employed > Investor
This simple statement forms the bread and butter of not only this chapter, but the entire book itself. It is the simple formula which can allow you to become rich via the path of being self employed, and this formula can be used in less than ten years. Unlike many personal finance books, where it takes many decades for you to build wealth, or those “get rich quick” books that predominate the market, by using the statement above, you can build wealth within a relatively short time frame. But what does this statement mean?
As the arrows indicate, the statement must be read from left to right. Employee is the area where most of us start out our lives, and it is also the area where most of us remain. To become rich, this statement dictates that you continue to move to the right, becoming self employed, and then becoming an investor. As you move right, you should visualize yourself moving up a staircase towards the top, which of course is the investor. Once you reach the investor position, you will be rich.
Being self employed is critical because it bridges the gap between being an employee and being an investor, or being poor and being rich. Very few books on the market have paid attention to this, especially when it comes to using the Internet as a tool, which will be discussed in the next chapter. However, at this point, the key thing for you to do is to keep this formula in mind, because we will reference it in other chapters of this book. It is called the UIF formula, or the Ultimate Internet Freelancer formula.
Some of you reading this may be wondering why I choose “investor” as the third and final step in the formula. After all, this is a book about freelancing, not investing, right? If this is what you're thinking, then you're absolutely right. This is not a book about investing. However, the reason why the investor is the third and final step is because it is impossible to become truly rich based on being self employed alone. Remember, being self employed is a “bridge” towards becoming rich, not the end itself. This is a critical component to understand, for it can mean the difference between riches and mediocrity.
Remember at the start of this chapter where I said that most of the people who become self employed do not become rich? The reason I said that is because many of these people, while successfully making the transition from employee to self employed, are not able to make the final transition from self employed to investor. It is absolutely critical to be able to make this final transition, because without being an investor, you cannot become rich.