Let's imagine that you want to cross the Pacific Ocean while you are still young, healthy, and full of energy.
Naturally, you'd want to reach your destination as quickly as possible, right?
Now, in this scenario, would you prefer to swim without the right gear, travel on a sailboat that relies on wind, or opt for a jet-powered speed boat with a top speed of 510 km/h?
I assume you'd choose the latter – that’s the fastest option.
Interestingly, in real life, most people do not act in a way that reflects this desire for speed.
Instead, they often choose the slower and less efficient routes – the Slowlane or even the Sidewalk.
In this article, we are gonna explore how we can achieve our financial goals at a much faster pace – we’ll be doing this, looking at the top five key points from the book "The Millionaire Fastlane" by MJ DeMarco.
The author himself experienced an incredible transformation when he decided to take the Fastlane road.
He went from a 26-year-old feeling down and living in his mother's basement to becoming a millionaire by the age of 31.
Okay, ready?
Let’s go!
To gain a better understanding of the Sidewalk, the Slowlane, and the Fastlane mindsets, we will emulate what each group will say on various topics.
I encourage you to honestly evaluate which beliefs resonate with you the most.
If you find yourself aligning with Fastlane beliefs, congratulations!
Remember, our beliefs shape our actions.
If you resonate with many Slowlane or Sidewalk beliefs, you might not be on the path to wealth yet.
Let's understand why and explore how you can make a change.
Your chosen path significantly influences your financial destination.
The Sidewalk leads to poverty, the Slowlane to mediocrity, and the Fastlane to wealth.
Let's examine the wealth equation for each to understand why this happens.
The Sidewalker believes that wealth is created like this:
Wealth = Income + Debt
Mistakenly, they see debt as a means for building wealth, associating material possessions with prosperity.
However, this mindset ignores the importance of money management, and more money doesn't solve poor financial habits.
Moving on to the Slowlaner's wealth equation:
Wealth = Job + Market Investments
Let's break it down.
The wealth from a job can look like this:
both tied to time constraints.
Option A involves increasing hourly wages or working more hours, risking burnout.
Option B necessitates investing time in education or corporate advancement, delaying significant financial gains.
The market investment equation involves Compound Interest, the eighth wonder of the world, according to Albert Einstein.
However, it, too, is bounded by time, taking many years to yield significant results.
Fastlaners appreciate compound interest but aim to bypass the initial 20 years, jumping straight to where substantial growth occurs.
Let's explore how they achieve this.
It's quite straightforward:
to escape the slowlane, you must leave your job and become an entrepreneur.
Without further ado, let's delve into the fastlane wealth equation:
Wealth = Profit + Asset Value
We can break down the profit generated by your business into two factors:
Units sold and profit per unit.
Here lies the power of the Fastlane. Both variables are highly leverageable.
You can sell products with $10 or $10,000 in profit, and you can sell just ten units or a hundred thousand units.
Contrast this with the slowlaner's wealth equation.
Earning $12 an hour and working 40 hours a week won't lead to wealth because small numbers gravitate towards mediocrity.
However, with the fastlane, profiting $10 per unit and selling a hundred thousand units can make you rich, and quickly at that.
Asset value accelerates your financial goals even more.
If you own a successful business system, people will likely buy it from you, often paying way more than one year's profit.
Just look at the stock market and its price-earning multiples.
Even if you conservatively get five times your yearly earnings, it's still remarkable compared to a regular job.
Imagine quitting your job and receiving a substantial check for your business.
Now, this doesn't guarantee success, as even a sidewalker who wins the lottery can become wealthy, and a slowlaner might become CEO of a Fortune 500 company.
However, the odds are not in their favor.
What we want is favorable odds, and that's why starting a Fastlane business is the way to go.
So, we've established that to achieve financial freedom quickly, you should leave your job and start a business.
But not just any business will do.
This isn't about following the "do what you love" or "be your own boss" advice.
A business should fulfill as many of "The Five Fastlane Commandments" as possible to be worth pursuing.
If you're not in control of your business, someone else is.
For example, relying on a content distribution platform to share your educational videos violates this commandment.
Similarly, many businesses earn money through Google's Adsense program, but the real profits go to Google itself.
If the market you're entering is crowded, you'll likely get stuck in a traffic jam.
You want barriers to entry in your business, such as specialized knowledge, significant investments, or essential contacts that others lack.
Doing what you love might not be a successful strategy.
People care about having their problems solved, not what you love.
Offering value to the world is the key to becoming wealthy, and impacting millions can lead to making millions.
Your business must eventually be able to function without your constant involvement.
Creating a business system that generates passive income is the goal.
Time becomes more important than money.
MJ DeMarco talks about "The Law of Effection," which highlights the importance of scaling.
This concept is so significant that it deserves its own key point.
So keep reading below.
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Essentially, becoming a millionaire through the Fastlane requires either magnitude or scale in your business.
Magnitude refers to the value you provide per person you impact, while scale pertains to how many people you affect.
Without either of these, you won't achieve the millionaire Fastlane.
Let's explore a few examples.
Slowlaner A sets up an ice cream stand outside his garage, earning one dollar for each ice cream sold.
He lacks magnitude in the business, and it's unlikely he can sell ten thousand ice cream from his garage.
This business fails the commandment of scale, as there's a limit to both magnitude and scale.
Fastlaner B (a doctor) starts a private clinic for cosmetic surgery in Hollywood with his best friend.
Like the ice cream stand, he faces limitations in terms of scale.
He can only provide value to a limited number of people each day.
However, he does possess magnitude since offering upgrades in looks provides substantial value to affluent clients, enabling him to become wealthy.
Fastlaner C discovers a new health product for young women, with a vast market potential.
Though she profits only three dollars from each product sold, she doesn't limit herself to a local garage sale like the ice cream example.
Instead, she partners with influencers and sells online.
Within a year, she sells 100,000 units, and in the second year, she sells a million.
Selling a million of anything significantly increases the likelihood of becoming rich.
When you combine both magnitude and scale, you're on track for the Billionaire Fastlane rather than the Millionaire Fastlane.
In summary:
- Ivan