Better ways of making and growing money: A business expert’s view

A Nigerian business expert and entrepreneur, Tayo Oyedeji, has explained the two key models of making and growing money, via his Twitter page.

According to him, there are two key models for making money. These are competence/skills and Hustle/flow. On the other hand, the two models for growing money are frugality/saving and investment/equity.

Professor Oyedeji identified all the approaches to making and growing money. We have compiled his thoughts for your reading pleasure. Below are his words.

Making vs. Growing Money

There are two key models for making money.

  1. Competence & skills
  2. Hustle & flow

And two key models for growing it.

  1. Frugality & Saving
  2. Investment & Equity

Both models are different. People get in trouble when they try to make money from a money-growing model.

1a. Making it: Competence & skills 
People pay a lot of money to hire competent and skillful people. The primary way to make money for most people is by developing complex, marketable skills. You develop some skills, find a buyer (employee) and sell your it + time.

 

1b. Making it: Competence & skills 

Complex skills are more marketable and expensive than mundane skills. For instance, I once charged a fee of $10,000 for less than a full day of work for business operations consulting for a big firm – Ops Mgt is a relatively rare skill.

1c. Making it: Competence & skills 

Do a quick audit of your skill-sets. Can they earn you a good income? If not, what additional skill-set do you need to build to earn a premium? Most people are lazy. They will not invest the time to build new skills. Be different!

1d. Making it: Competence & skills

In today’s world, technical skills are more expensive than non-technical ones. My AI mentor was a music composer who went from $25,000 a year to $150,000 in 12 months. He still plays music but is now a data scientist at @EpicSoftHosp.

2a. Making it: Hustle & flow

Many people are not wired for technical competence. They, however, have natural business skills that can help maximize their income. Others have both. They can hold down a regular job while hustling on the side.

2b. Making it: Hustle & flow

I have always done both. I sell competence during the day and hustle at night. Most employers will not pay you more than you need to live a decent life. To make more money, you will need to build a side gig that will multiply your income.

3a. Growing it: Frugality & saving 

If you make $1m and spend $1m, the money just passed through you. You are not wealthy. You’re just a money conduit. On the flip side, if you make $2,000 a month and keep $500, you just grew your net worth by $6000 a year.

3b. Growing it: Frugality & saving 

The first way to grow money is by living below your means so that you can save some. 

1. Don’t buy crap you don’t need. 
2. Sell anything you haven’t used in a year.
3. Don’t impress people with things, impress them with your investments.

4a. Growing it: Investment & equity
This is actually why I wrote this thread. Many people hold a misguided view that investments and other money-growing models are the path to making money. Let me debunk that notion. Investments are for growing money you have already made.

 

4b. Growing it: Investment & equity

This erroneous notion is why people fixate on dubious/questionable ways to make money – FX trading, gambling, ponzi schemes, etc. The promise is that you can make a lot of money with a little amount of investment.

4c. Growing it: Investment & equity

The models for making money are skills & competence (employment) / hustle & flow (business). Frugality grows your savings and investments accelerate the growth. Learn to create value & make money first. You can only grow what you have made.

4d/ Growing it: Investment & equity.

If you try to make money with a money-growing model, you will chase risky propositions and lose money. The way to make money is by creating value with your skills or business. Then you save some, and grow it with investments. Here’s the formula again.

Make it with #makemoney:
1. Competence & skills
2. Hustle & flow

Grow it with #growmoney:
1. Frugality & Saving
2. Investment & Equity

Don’t try to switch the two models.”

Source: Nairametrics

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