The other day, I was in the middle of a small negotiation with a friend whose business I’m going to help for at least the next six months.
It’s exciting work that’s right up my alley, but as we went over the terms of our agreement, something was leaving me just a little uneasy.
At first, I couldn’t put my finger on what it was. But after thinking it over awhile, I realized what was causing it: I wasn’t building equity in the project. I wasn’t creating an asset that I would own.
In the last three years of working full-time for myself, I’ve realized something important about what drives and motivates me in my work, and it’s the feeling that I’m building something for my (and potentially others’) future. I love the feeling I get knowing effort I put in now will pay off in big ways later.
Ownership is important to me, and I’ve learned I have a hard time staying on task if I don’t feel like I own what I’m doing. This is why I made a horrible employee when I tried that route.
So, my friend and I are now working on a new agreement that’ll satisfy the both of us and, just like that, I’m excited and motivated. Ta da!
A Smart Riskologist is Always Building Assets
Life is short and, if you want to build something that lasts and provides for you and your future, it’s important you have ownership over the work you do.
I realize my opinion is heavily influenced by my undeniable Americanism (yee haw!)—and that there are many ways to look at the idea of ownership—but if you’re like me, and you’ve wondered in the past why you had a hard time getting excited about the work you were doing, it might be because you didn’t feel like it was building something significant for yourself or your family.
As a Smart Riskologist looking to secure a stable position in life, I recommend looking at everything you do and asking yourself: “Am I building an asset? Am I creating something greater for my future?”
If the answer is no, then it’s time to take a short break and figure out what changes you can make to turn that situation around. Your future depends on it!
Every Day, You Trade Away Three Valuable Resources
Each day, you have available to you a number of resources that you regularly trade away to make your world turn. The three most important are time, money, and relationships.
Time is, of course, the most valuable resource you have because it’s completely finite and, once lost, can never be recovered. If you’re not using your time to build something that increases in value, this is a dire emergency! Time to re-evaluate how you spend your days!
Relationships are something we lean on each day to enjoy the comforts we do and get all the things we need to done. Spouses cover your chores, colleagues pick up slack at work, friends and relatives lend a hand during hard times and when you can’t accomplish what you need to by yourself.
If you’re not careful, it’s easy to abuse your relationships and deplete them. Soon enough, they’re gone and you either have to change your lifestyle or find someone else to begin depleting. Take a look at the relationships you enjoy every day and ask yourself if you’re giving back to them in the same amount they’re giving to you. If not, you’ll find it hard to accomplish any big goals you may have in the future. You’ll also be lonely soon!
Money is only a tool, but it’s a valuable one to be respected. Also, who doesn’t like owning lots of tools? If you manage your life properly, you can use the money you have to create more of it—a truly passive asset—rather than trading your time or relationships for it. This is a great place to be and one you should consider working toward no matter how daunting it may seem right now.
Ask yourself, “What am I spending my money on, and is it returning more of it to me than what I sent away?” If the answer is no, it’s time for a money makeover.
A Few Assets for Smart Riskologists to Build
What kind of assets should a Smart Riskologist own? I make no judgement on what makes one better than another. Instead, I live by just one rule: Whatever I own must return more value to me than it takes away. That’s it! Just one, simple rule!
A Few Traditional Assets
There are a few things pretty much everyone agrees are good ways to build assets in your life:
- Equity in a business: You can start it yourself, buy it, or vest into it over time with money or work.
- Property: Owning property means you get (for the most part) complete say over how it’s used. To make it an asset, rent it to someone who finds it valuable.
- Investments: Take some of the money you already have, and turn it into more by investing wisely. This is kind of the same as buying a business.
A Few Unconventional Assets
There are also plenty of other, less conventional ways to look at building assets which can be incredibly lucrative. A few for your perusal:
Friendships: If you give of yourself wisely in time and money to others, the investment is almost always returned in ways you could never imagine. And the bonus, of course, is that having friends and meaningful relationships is fun.
Marketable skills: Learning how to do something is hard, so most people don’t do it. Instead, they pay someone else to learn and do it for them. If you find the right skill to learn, you can turn it into a lot of money (or other useful asset).
Time saving processes: If time is your most valuable resource, finding ways to save it on repetitive tasks is one of the most shrewd investments you can make. Efficiency is an asset! Here’s a cool chart that shows you how much time you can safely spend to improve a process in your life.
A car: For the average person, a car is more like a reverse cash machine; you dump loads of money in and none of it ever comes back. But a Smart Riskologist understands that if someone will pay to use it, it can actually be a valuable asset. I rent my car out on Getaround and, when all the mathdust™ has settled, I actually earn money on top of my otherwise free car.
Storage space: The other day, I saw an ad on Craigslist for storage space in someone’s basement. Genius! Rather than building assets, most people just buy junk… that ends up in a basement. When their basements are full but their capacity to buy more garbage is not, you can let them pay you for the opportunity to store it.
This is just a short list of endless possibilities.
Remember: if it returns to you more than it costs you in time, money, and relationships to acquire it, then it’s an asset. If it meets the criteria, it’s in!
One thing to know about assets, though, is they generally require you actually do something with them. None of the examples above are assets until you put them to use in a creative way that makes them so. And it takes a little effort.
You’ll never be perfect, but the goal of adopting this kind of mindset is that, as you go through each day, you begin to regularly ask yourself, “What am I building, and how is this helping me build it?”
If you ask yourself that question just once each day, you’ll go farther than you ever imagined.
Yours in risk taking,
Founder, Advanced Riskology