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How Can You Make $100,000 Worth More Than $200,000?

21 June 2008 5 Comments

Is it possible for $100,000 to be worth more than $200,000? I think so, and let me explain why. If you look at the lifestyle that $100,000 or $200,000 is to represent, and focus on it, I can show you how sometimes the former is worth more than the later. I encourage you to read on.

In one of my favorite books, The The Four Hour Work Week” by Tim Ferriss, he talks about some freedom multipliers. I like to refer to them as rich multipliers.

Now, first imagine to yourself the lifestyle that a $100,000 income should look like. Then, imagine what a $200,000 income lifestyle should look like. Now, mentally erase the actual numbers from your mind and continue to focus on the lifestyles you just imagined. The reason: being financially rich is a very different concept than having the ability to live like a millionaire.

There are ways to make the lifestyle better; there are ways to “multiply” the lifestyle. This is where the rich multipliers come into play. Let’s look at each of the four rich multipliers.

Multiplier #1: What You Do

Doing the things you enjoy in life more frequently will multiply your lifestyle. For me, these things are spend time with people close to me, workout and run, play golf, blog, etc.

Multiplier #2: When You Do It

When do you do the things you enjoy? Do you squeeze them into the small chunks of time that are left over after all of the mandatory time commitments you have in your life? Multiply your lifestyle by having the freedom to do the things you want at any time you want.

Multiplier #3: Where You Do It

Are you tied to your desk or your office or your city? Having the freedom to do things you enjoy anywhere is another multiplier for your lifestyle. Maybe you enjoy surfing but live in Florida. Are you able to take work with you to California so you can surf there for a few months? Wouldn’t that be incredible?

Multiplier #4: With Whom You Do It

Last, but definitely not least, with whom are you spending time and with whom are you doing enjoyable things in life? Having the ability to spend more time with the people you love multiplies your lifestyle abundantly.

Putting The Equation Together

Back to the original question, how can $100,000 be worth more than $200,000? Well, how about if the person making $200,000 also works 100 hour weeks when the $100,000 person owns a self-sufficient and self-operating business and only needs to work a few hours a week remotely. What would you prefer?

It gets even more interesting if the person owning a self-operating business that earns him $100,000 a year in easy money declines to grow his business to double his income since he’d prefer not to add hours to his work week. Why on earth would he do that? Because his lifestyle is greater than if he made $200,000 and became a slave to his company. His lifestyle is greater because of the rich multipliers implemented into his lifestyle.

He is, in fact, more “rich” than the person making $200,000 because he can go anywhere, do anything, with anyone, at any time he desires. Now THAT is a lifestyle worth pursuing. I know that’s what I desire.

Shooting For More Multiplication In My Life

As I talk about at length, achieving more channels of passive income is my number one goal. I don’t desire millions in income each year, but I desire more wealth driven through more passive means. A comfortable income that supports my lifestyle with maximum freedom is worth the effort.

As I continue to blog each day, it is my goal to grow this blog and monetize it. Hopefully, this blog can become a source of income for me that supplements my career and investments. While a blog is definitely not as passive as I imagined before getting into it, it is something I enjoy and would love to earn some income through.

There is no right or wrong path for you to take in your journey for wealth and for a particular lifestyle. The wrong path is not having a goal and being unintentional as you move in whatever direction the current pushes you. Be intentional. Know what you’re striving for and work hard to get there. Good luck.

Self-Reflection Questions

1. What do you desire more, a higher income or more freedom?

2. If your boss offered you a raise to make more money or work less, what would you take?

3. How many rich multipliers do you have implemented in your life?

4. How intentional are you in positioning your life and pursuing the goals that you have set?

5 Comments »

  • investmentplayground said:

    Kevin my friend – you disappoint me. All this great investment advice, and you speak of the 4 Hour Workweek as a favorite book? Tim Ferris is a JOKE. His whole book talks about finding a passive and automated stream of income that gives you enough money to do what you really want to do. He suggests selling knowledge, as this is timeless. And then he wrote a book about doing that. And we all got duped into buying his garbage, meanwhile he’s off living in Costa Rica on our dollar.

    Your post is great. Your post is a lot better than that crappy book is. Finding passive income isn’t easy by any means. We should have the end goal in mind – freedom and time to do what we want and when we want. And slowly but surely always work for that.

  • kevin duffey said:

    I would agree that the book has flaws. For example, Ferris's story is that he took a business that earned him 40k a month but that he was a slave to, and turned it into a business that earned him 40k a month without him having to work at all. He did this by forcing himself out of the equation. He then tells us to do the same.

    Well, this assumes that we have a business already earning us 40k a month that we can then outsource personal work and travel the world. Not very realistic.

    However, to dismiss the entire book because of some flaws is irresponsible. There are many great points in the book.

    1. most people's work habits are not conducive to productivity and we waste endless amount of hours of our life "working"

    2. there's more to life than earning hundreds of thousands of dollars for possessions but not having any freedom in our life

    3. there are numerous practical ways to eliminate some of the busy work of our lives

    i think overall it's a great read. some things won't apply to everyone, but take the individual aspects of the book that can apply and help.

    Thanks for the comment.

  • Ray said:

    When the markets fall apart again in January 2009 you could put your $100,000 in ticker BGU and come pretty close by fall of 2009.

    Great post!

  • Salina Blackwood said:

    The crux of your writing while sounding reasonable at first, did not work very well with me after some time. Someplace throughout the sentences you actually managed to make me a believer unfortunately just for a while. I however have a problem with your jumps in logic and one might do well to fill in all those gaps. In the event that you can accomplish that, I would surely end up being fascinated.