We are unaware of a post that addresses the issues of the middle class mindset. We’re going to try and tackle this.
The middle class mindset is essentially derived by mainstream propaganda, indoctrination during college and through branding and insecurity. The trick to keeping the middle class in the middle class? Focus their attention away from themselves. Force them to focus outward, base their lives on the opinions of others, and ignore their own intrinsic value. If that is not disturbing enough take a look at the points below and begin ridding yourself of each mindset/action.
1) Talk the Least: People who are stuck in the middle class tend to talk the most. Just one week ago during a short business trip, an uber driver who makes $120K per year with his current job and his uber side hustle was explaining how to invest in equities. The conversation was interesting, not because of the underscored point above, but because he gave every single detail about his life… For free. If you’re going to move up in life you have to be getting more information than you are giving.
For simplicity, if you are obtaining more information than you are giving throughout the day, you’re going to hold onto more information to give to higher powers than you. There is no point in giving any information out unless you see a mutually beneficial outcome. It really is that simple. Play it cool and let them do the talking, two ears one mouth. The ratio should always be the same.
To drive home the point, think through your most successful interview. Have you ever landed a job where you explained how great you were for 2/3 of the time while the other 1/3 of the time you allowed the interviewer to speak? The answer of course, is no. If you carefully choose your words and times to interject, the interviewer will come to the conclusion that you are bright. If you’re actually good at X task, other people will tell them. Not you.
2) Don’t Trade Time for Money: We got a lot of questions about what this means. Although, the repeated question is likely the same user logging into different IP addresses, we’re going to knock this one out of the park right now.
If you are earning the *majority* of your income based on a Salary or Hourly wage you are trading time for money.
If you are earning the *majority* of your income based on performance based incentive compensation and passive income, you are NOT trading time for money.
It really is that simple. People don’t understand that Sales, Wall Street, Equity in Silicon Valley and Businesses do not trade time for money. This is simply because they cannot rewire their brains. You want to trade your money for time.
Yes if you work for a large corporation in sales, Wall Street or otherwise, you will be paid a salary as a **Part** of your total compensation. Make no mistake. If your salary > bonus, you don’t matter to the firm… At all.
Finally, since everyone has asked for an example of how you can avoid trading time for money, below is the clearest and cleanest way to think about buying time with money.
If you spend $10,000,000 a year on advertising are you wasting money? The answer of course… is it depends. If you spend $10,000,000 a year on advertising that leads to $20,000,000 in net income… The answer is no. By advertising you are buying a person’s time (getting them to look at your product/service) and ideally convince them to buy… Without you doing a thing. Correct? Correct. Below is a typical week of business advertising spend (no, not for this blog of course).
3) Compete With Yourself: Another growing trend for the middle class is to “compete with everyone”. This is actually a poverty mindset more than it is a middle class mindset… Yet you see this belief growing in the middle class nowadays. Go to a middle or upper middle class area and people are sizing each other up like they are going to get into the ring for a 12 round boxing match. It is comical.
Why is it comical? It is comical because if you are competing with someone, you have some belief that the person you’re seeing is better than you. If you believe the average person in the bar or club is better than you, it means you’re not very successful yourself. Only people who are broke believe they are in a competition with everyone or believe people are competing with them. To say the least? It is a joke.
If you need further proof of this, simply look at the top performers in any industry. They do not compete with people who are below them. You won’t see the #1 tennis player in the world getting on twitter to smack talk the #500 player in the world. If anything, he will try to find ways to give him pointers to improve his game.
Instead? They compete with themselves. If you are at the top of your game you are competing with your previous year. If it’s money you’re after, you’re comparing your next year to the previous year’s earnings and nothing else. Take a page from the elite and emulate them. You are only competing with yourself.
When you meet a new person you should search for information and ask yourself “can we both win by working together?”. If the answer is not a yes, simply move on. There is no reason to compete with someone if they are not going to be in your lane.
4) Cut Alcoholism: If you are still blacking out from your drinking adventures and you are over the age of 22, you should be ashamed of yourself. In addition, you have a serious drinking problem. There is no exception to this rule.
Alcohol is a great substance for celebration and should be taken seriously. If you got your first $100K+ bonus check as a hedge fund associate, feel free to have some drinks and a nice dinner. However… You should not black out and get kicked out of a club/bar.
There is no glory in being able to “crush 10 drinks in a night”. All you are saying is that you’re trying to escape your normal life.
5) Prestige is a Trap: We talked about this on our FAQ page and it needs to be revisited. The only thing that prestige is good for, is if it is the beginning of your career. Here is how the prestige trap works.
Head Hunter: Hello associate at Barclays, we have a position open at Goldman Sachs that we are looking to fill. Are you interested?
Naive Junior Banker: Absolutely it’s Goldman Sachs!
Head Hunter: Great send me your resume and we will be in touch (click – giggles on the other line because you are about to make $10K extra to restart the entire political process while the headhunter collects a nice fee)
The headhunters are getting more creative these days and are even convincing people to move from potential promotions to “the buy side” where they will make the exact same amount but work extra hours. It is a trap. Before you make a jump you should make sure that you are not making it due to prestige. We’ve said it before and we will say it again.
“F**K Prestige. Get MONEY”
This highlighted point brings us to the next part of the middle class mindset…
6) Chase Responsibility: This is where most people fail to jump out of the middle ranks. Many people prefer that steady $120-140K base salary and $100-120K bonus for life. This is career death. You need to take a risk and chase the pie, without the pie there is no income growth.
Most people in the middle class enjoy following rules and regulations because it is how they moved up to their cushy positions. This is not going to serve them well once they approach the age of 30. You’re going to have to find a way to get a piece of the pie. If you want a cliff notes explanation of how following the rules won’t work… Here you go.
Managing Director: Hey you’ve done a great job for us, if you want to stay on long-term we will take care of you no worries.
Sr. Associate/Jr. VP: Well you have taken care of me before, i believe this is a great slot and want to continue being part of the team.
—- 1 year passes, **record numbers** —
Managing Director: Hey we had another great year here’s your bonus of $100K (flat from last year)
Sr. Associate/Jr. VP: Well, numbers were up why is my income flat?
Managing Director: Well we don’t know if you contributed *that* much so we felt that paying you at the top of the class would be fair.
Now you are wondering, well how do you get out of this situation?! How do you avoid being in the support role for the rest of your life? How do you avoid the flat line of $150-250K for the rest of your life?!
Just like everything else in life, the answer is simple. Take risk.
At this point, you need to analyze your firm. Find the weak spots and see if you can find a way to *increase the size of the pie* (also known as the bonus pool). Once you are able to prove you can increase the size of the pool through revenue generation (yes you may need to step on toes here) you’re going to be able to haggle for a slice of the pie. It is simple, yet incredibly difficult to pull off.
7) Think BIG: Most people see that phrase and believe it means “Think about making your ego huge”. This is entirely wrong. What does think big mean? It means you need to think of ways to leverage your skills to maximize returns.
People keep emailing us about how to use their 401K’s. We have the same answer. Who cares. Please stop emailing with these questions.
While you should max it out (tax purposes) and at a minimum get the Company match (free money), if you are even thinking about your 401K beyond a couple of clicks on the computer screen, you’re wasting time. Not a single person in the history of mankind got rich off their 401K with time to enjoy it and no one ever will… by definition. If you’re worried about perfect allocation of a few hundred thousand dollars, you don’t see the point and you’re wasting your own time.
Even if you contribute $17,500 per year for the next 30 years. That is $525K. Lets go ahead and 4x that just to make you feel richer. That’s $2M. The catch? You’re 60.Oh and by the way? Due to inflation that $2M is only worth $1M in today’s dollars.
If you do not believe that a million or two by 60 is not an accomplishment, go and volunteer at a hospital. It is a great experience. It is a disturbing experience. Every single “rich” person you meet will tell you they wish they lived their lives for themselves and not for other people… saving and waiting for the perfect time to enjoy life… That never happened. Try to keep that bubbly smile on your face as you realize these men and women have money but no way to enjoy it.
… What does this have to do with thinking big? Everything.
Once you realize that you only have 30 years to live. Ages 25-55, you’re going to start building real skills. Time is not on your side. Once you really understand that this is the only time frame for fun and enjoyment, you’re not going to worry about missing your friend’s bachelors party or missing the next sporting event, you’re worried about maximizing you. Finally, once you realize the clock is always ticking, you’re going to start thinking in terms of scale and leverage instead of time and wages.
The paragraphs above will unlikely stick with anyone who reads it. They will simply nod and agree and go back to reading about the latest sporting event, celebrity gossip, or swiping on tinder. All this means for the people who get it? There is no competition.
8) Read for Information NOT Motivation: This is going to strike a cord with a lot of readers and people. Motivation based reading is the biggest ponzi-scheme in the world. Not only is it a ponzi-scheme but it is a LEGAL one at that. Don’t make us laugh. Here is how it works in simple steps
Step 1: Write extremely emotional posts/texts on the internet to force a readers to “feel like they can be somebody”
Step 2: Write a book or sell a product that convinces people to “take action”, anything you can do that gets them out of their comfort zone
Step 3: Once you sell 100+ units, 10-20 success stories roll in and they will foolishly claim “THE product changed their life”(For some reason they don’t realize they changed their own lives and the product did nothing)
Step 4: Author takes success stories (ignores failure stories of course, that would be bad marketing!) and then uses that to validate the product
Step 5: Slowly raise prices of product as people who were on the fence to buy it, see the prices rising and then decides to buy it as well! If the prices are going up it must be good! (See point 5 about prestige and branding being a trap)
Step 6: Take the success stories that roll in (a few will always be successful) and reiterate
There you go. Now you know how the motivation ponzi-scheme works. Smart people realize this scheme and only buy information based products, not feel good motivation based products. If the product is based on motivation or “go get em” type hype, you know it is a way to create a recurring revenue stream based on emotion.
To those that don’t believe this, you’re being scammed. If you are able to put yourself outside of your comfort zone ON YOUR OWN, you already had the skills necessary to succeed. Do not hold up some book and claim it was the holy bible to your success. It wasn’t. Your success was based on your own internal motivation and don’t let anyone else take claim for it. They are just going to use you for marketing.
Hopefully this gives the readerbase a lot to think about.
1) Are you trying to prove to the world how good you are through your words to new acquaintances? Stop.
2) Are you trading all of your time for money? Find a way to leverage your time.
3) Do you think everyone is competition, or that people are trying to compete with you? Neither will be of value.
4) Are you still getting drunk every weekend? Hope you just sealed a big transaction that night.
5) Are you choosing prestige over money? Foolish.
6) Are you moving positions for the brand? When responsibility leads to a piece of the pie, choose responsibility.
7) Do you think you’re going to live an amazing life at 60? Go volunteer at a hospital.
8) Are you buying motivational products? You’re the product.