Today we have a guest post from Erik Finman. Erik is a bit of a teenage prodigy and we thought it would be a good change of pace compared to our older guest posts on real estate and other items. Erik became a millionaire at the ripe old age of 18 by investing in crypto currency back in 2011 and more importantly selling a company (which you hear less about). In fact he sold his first company Botangle in 2015 and that was reinvested into bitcoin. After this he started a virtual reality headset company, moved into robotics and is currently planning to launch a satellite (more on that below!). With that, below is Erik’s post, unedited as usual! (note hyperlinks were added by us)
If you’re reading this article, that probably means you’re someone who desires a certain level of freedom and autonomy in your life. One of the surest means to achieve this level of freedom and autonomy is through financial independence. This concept of financial independence is best found through avoiding debt and building capital; but actually achieving both of those can be incredibly challenging for some. Our entire society seems structured around keeping people shackled to debt and distanced from capital.
However, beating the system and coming out on top isn’t impossible. Most often it depends on you making the right investment decisions – which for some people can seem impossible. Nevertheless, we try to make sound investments every day, and not just with our money. We invest our time in certain tasks, while we avoid investing in others that don’t seem profitable or desirable. We invest our money in certain products that seem like the best deal or what we want, while we avoid investing in others that seem like a poor value. Investing isn’t hard, we do it every day.
There are three things you should be investing in, or not investing in, to ensure you have the most freedom and autonomy in your life. To help explain these three ideas, I’ll use the investment terms “Short” and “Long.” Read to the end, and you’ll see exactly why I’ve taken the stances I have, and how it has worked out for me so far.
1.) Go Short on Higher Education
This is controversial for a lot of people, but higher education system has proven to be highly detrimental to many young people. There are few things you can do at 18 years old (short of breaking the law) that will do more to harm your future self than taking on massive amounts of debt at high interest rates. Yet, this is precisely what so many high schoolers are encouraged to do. This is a hope-to-despair pipeline; students graduate high school full of hope for their future, and four years later graduate from college full of despair and desperation.
Those loan payments are due just a few months after you graduate, and the job prospects for someone with a 4-year degree are becoming increasingly thin. Faced with this grim outlook, many recent college graduates decide that they have no other option than to pursue a graduate degree, in hopes of increasing their job prospects and overall pay. This works for many, but it also drastically adds on to their total amount of debt. The result is spending the remainder of their youthful years paying off high interest loans while working the first job that was available. Most people in this position have given up on that lifestyle they once dreamed of, settling instead for a sedentary lifestyle of being just comfortable enough to not complain too much.
The alternative: pursue hands-on experience and independent education. Unless you’re planning on pursuing a specific career field that requires a highly specialized degree (like becoming a doctor or lawyer), most career paths can actually be obtained without a college degree. It’s counter-intuitive to everything you’ve probably been told, but it’s becoming increasingly true every day. I’ve met a number of executives who have told me, flat out, that they prefer hiring someone without college degrees, and that college degrees are beginning to signal qualities that they may not want to hire.
My plan: I’ve recognized that this is a systemic problem that has started from the middle school/high school level. To combat this, I’m working on creating a school that will give students full autonomy over their education. With no strict parameters, no politicians demanding a certain curriculum, and the complete freedom to pursue what they are most interested in, students at my schools will be able to gain hands-on experience in the field of their choice. Students will graduate from my schools with the technical skills, detailed know-how, and passion for their field that employers are looking for. You don’t have to go into debt and spend 4+ years of your life at a college to be competitive, and my hope is that more students realize that.
Resource: All of the truly unique resources I learn from are too controversial to say publicly. Dark arts. That really says something about the world doesn’t it. How many other people are hiding excellent resources that if shared they would be fired for but are actually useful and helpful. My resources are too controversial to say or not in public. So not including those I’ll say this blog!
2.) Go Long on Cryptocurrency
By this point you’re probably well aware of the insane hype we saw last year around Bitcoin, culminating at an all-time high price of nearly $20,000 per Bitcoin, before dropping down to where it is now. This left a lot of people feeling jaded about the idea of cryptocurrency as a feasible idea, and many people who had just entered the market quickly left it just as suddenly.
But while the news cycle has moved on from talking about Bitcoin, many cryptocurrency projects are quietly making significant progress and setting themselves up for the next bull run. Big banks are trying to start or acquire their own cryptocurrency projects, some governments are considering moving to blockchain-based currencies, and the cost-per-transaction of most major cryptocurrencies are dropping fast. This means that the ingredients are all there for the next bull run to be one that lasts. The previous all-time highs seem premature, mostly due to a media blitz and people not wanting to miss out on profits. The next time it comes around, the projects being funded are more prepared to do what they promise to do.
The alternative: ignore cryptocurrency. You likely won’t directly lose money (at this point) by not investing in cryptocurrency, and your hard-earned money can stay safe in a bank account while inflation eats away at it. Investing in cryptocurrency may seem too high risk for some people, and you need to be honest with yourself if that sounds like you. But if you’re at all hoping to earn your first million in the coming years, investing in cryptocurrency is probably one of your most direct routes.
My plan: I already have holdings in various cryptocurrencies, but my hope is to spread the wealth by spreading information. I’ve recognized that there seems to be a significant entry barrier to many people getting into cryptocurrency; the industry seems confusing, too many people are shouting contradicting opinions, and predators lurk for their next victim to rob and scam. To counteract this, I’m working on a basic crash-course on what cryptocurrency is, how to invest in it, and how to keep it safe. Cryptocurrency represents the largest transfer of wealth our generation has ever seen, and I hope to see more people move towards financial freedom through cryptocurrency.
Increasing Adoption: Simplicity and good design. We need an iPod to make MP3 players mainstream. We need an iPad to make tablets useable and mainstream.
In addition to cryptocurrency and blockchain technology, there are a variety of other emerging fields that hold great promise for the future. Developments in Artificial Intelligence (AI) are progressing rapidly, Augmented Reality and Virtual Reality (AR/VR) are quickly becoming profitable industries, and nanotechnology will likely be part of the building blocks of the near future.
These are all industries that may seem hard to enter if you’re just in your late teens or early 20’s, but you can start laying the groundwork now for a future in these industries. All of these technologies will require some level of coding proficiency, and a rudimentary understanding of electrical engineering and robotics will also be extremely advantageous. Most college majors aren’t teaching the skills needed to thrive in these fields, so any learning you do on your own will make you hyper-competitive on the job market compared to your college-educated peers. These emerging fields will be where the high paying jobs of tomorrow are, and you’d be wise to start moving in this direction ahead of the crowd if you want to have gainful employment in the coming years.
The alternative: stick with the fields that are in-season currently, like psychology, business, nursing, and education. Skills in these fields are adequate to get a job currently, but they also put you in jeopardy of being replaced through automation, or by a new worker who not only has the skills you have, but also the skills of an emerging field that is becoming more in-line with your field. Focusing on these fields will pay off today, but likely won’t help you for too long down the line.
My plan: I’m working on launching a satellite that will incorporate AR/VR technology, allowing students around the globe to experience space in real-time and hopefully inspire them to think bigger for their futures. In addition to this, I’ve enjoyed creating a robotic suit that improves strength and coordination, and I can definitely see ways that this could help more people going forward. Circling back to earlier when I mentioned the new schools I’m planning to build, I intend to make emerging fields a centralized theme for students, with plenty of classes offered in formats that will help every student succeed and grow into talented professionals ready to build the future.
There’s a lot of noise out there, and it can be hard to figure out what’s worth your investment and what isn’t. I’m confident that if you invest your time, energy, and resources based on my three recommendations above, you’ll be well-situated for what comes next. Good luck!
WSPs Notes: First of all we’d like to thank Erik on his guest post today! Lots of interesting items and unfortunately one that stands out is “the dark arts” comment where we think we know what he is referring to (but will never know for sure!). We agree with the majority of comments and do think it should be noted that Erik is at the top percentile in IQ. This means some of his decisions are not going to work for people in the top 10% or so. Hope you guys enjoyed it and we’ll be back with our normal post soon along with another Q&A announcement. Don’t forget to follow him on Twitter by clicking here as well!