The simple answer to making more money can be summarized by one quote.
“You get paid for bringing value to the marketplace” -Jim Rohn
Value to the Marketplace
A worker at McDonald’s provides much less value to the marketplace than a heart surgeon, so the McDonald’s worker gets paid less than the heart surgeon. The rarer and the more in demand your skills are, the more value you can provide to the marketplace.
Many people mistakenly believe that they get paid for their time. You hear it when people say they make x dollars an hour. You see it when people go to work and just put in the time and wait for their annual cost of living raises and hope to get promoted. The problem with this strategy is that your income rarely strays too far from the value you provide to the marketplace. This causes most people to waste their time at work instead of finding ways to provide more value.
To maximize the value you provide to the marketplace you need to think about what skills you have or can develop that people are willing to pay the most for. Look for the people that make the most money per hour that you know of. What skills do they have that you can develop the easiest?
My wife is an accounting manager and both controllers and physician’s assistants can make an annual salary of $120,000. It would be much easier for her to get the controller position than to be a physician’s assistant. She may just need to apply to controller positions, worst case she could finish getting her CPA to easily qualify. Conversely, to become a physician’s assistant, she would need to learn an immense amount of information in the healthcare field and spend nearly $100,000 on schooling. On top of that, my wife enjoys working with numbers and dislikes being around sick people, so becoming a controller is hands down the easiest way for her to increase her value to the marketplace.
I have another friend that already has a nursing degree and hates dealing with numbers. This friend would require him to learn much more about accounting and spend nearly $100,000 on schooling then he would need to get years of experience working as an accountant before he could become a controller. Or he could take the additional classes he needs to be a physician’s assistant in a content area he is already familiar with. For him, becoming a physician’s assistant is an easier way to increase his value to the marketplace.
The previous two examples focused on traditional career paths, but starting your own business is one of the best ways to internalize the value to the marketplace perspective because your income comes directly from your customers. I suggest always starting your business as a secondary income to your traditional job at least until the income surpasses your traditional work. The benefits of having a side-business are that it diversifies your income away from your traditional job, it has unlimited potential for increased income, and you aren’t used to spending this additional income.
Remember when you start your side-business that your income will still be a reflection of the value you provide to the marketplace. It is tempting to chase what looks like an easy way to make money without considering the value you are providing. These get rich quick methods invariably fail. It takes an effort to find what value you can provide better than anything currently in existence that people would be willing to pay for.
So this leads to the question, “what can you do right now to start increasing your value to the marketplace and earn more money”?