why it’s hard for an employee to become rich

why it’s hard for an employee to become rich

If you have been raised in a middle-class household like me, you’ll be well familiar with the standard advice that your parents or other family members might have given you to attain financial security. While the words would have been different for many of us, essentially the common man’s approach to financial gain can be summed up into this mantra: “Get a degree, get a good job, work hard, save money.” Once you do that, you have nothing to worry about, you’ll be fine! 

But let me be straight with you: this advice might get you in better financial shape in the short-term, but in the long haul, it will never make you rich and create generational wealth. In fact, this approach will keep you in the 90 percent of the population that only has 10 percent of the total money.

So, what’s the best approach to become financially secure? The short answer is: Develop the mindset of the rich. Unlike the majority, wealthy people don’t toil away at one job until retirement. Nope, that’s not their style. Instead, they go through the business route and make well-planned, worthwhile investments. 

Employees from the get go have less money to invest in assets that have the potential to generate wealth, since they give a significant portion of their paychecks as taxes to the government. It’s unfortunate, but this is how the system works. Business owners, on the other hand, have more money to invest because it comes straight out of their pre-tax earnings. So, while an employee has no option but to save from the taxed income, a business owner can make investments first and then pay taxes later on. 

There’s one more reason why becoming a business owner and/or investor is a better path to becoming rich: they often face less risk than employees. Many people still rely on full-time employment, savings and pensions for gaining financial security. But this is a flawed approach. The world has changed drastically and the old concept of having a stable job for life has become obsolete and just doesn’t apply in today’s marketplace. Employees get fired and laid off all the time; just think about the recent pandemic situation where so many workers had to part with their “steady jobs.” And have you ever wondered what happens to a company’s share price when it lets go of tons of employees? In almost all cases, it goes up! This makes being an employee extremely risky — definitely riskier than joining the team of business owners and investors. 

At the end of the day, in the words of the late, great Jim Rohn, you must choose if you want to make a living or make a fortune. If you want to make a living, become an employee and work hard on your job. And if you want to make a fortune (which I highly suggest!), become a business owner and/or an investor and work hard on yourself. 


If you’re someone who is actively pursuing the journey of financial literacy or a clueless beginner who is just getting started, I highly encourage you to get my eBook, Daily Wealth.

This short book is an attempt to distill the life-changing ideas from the best books on finances, money management, and investing in clear and concise daily meditations. I can confidently say that your money game will reach a new higher level in record time if you put the principles mentioned in this book into practice.  

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