You Can’t Nickel And Dime Your Way To Riches

There seem to be two main currents of thought when it comes to the management and use of money in America. One current comes from earlier years when Americans were tighter on money and from a scarcity mindset. Usually more popular with older generations this line of thought says to save every penny that you earn and to cut costs as much as possible. If it takes an hour for you to save five cents so be it.

The other train of thought says that with credit everything is possible. It is normal and necessary to take loans out nowadays and there is no shame in doing so. That things like student loans, mortgages, and such are needed and necessary. This line of thought is all about racking up debt to join in the “American dream” of going to college, owning a house, and being a slave…er wait not that last one.

Both trains of thoughts will keep you from ever getting rich. While the rack up debt train of thought is losing speed, the nickel and dime one is growing. It claims to be the solution to the debt society but really is just another way of staying poor. I’ve addressed why college and debt is not worth it but I haven’t addressed this nickel and dime mentality.

Nickel And Dime Mentality

The nickel and time mentality people are people who will do anything to save a buck. They value their time very little but value money greatly. Which is probably why they always stay poor. Nickel and dime people believe saving every penny and never taking risks will get them to financial stability. Unfortunately for them while a better option than the acquire debt, this road will ultimately lead to barely surviving or should bad economic times come, starving.

You can’t nickel and dime your way to riches, it isn’t possible. Riches come from leveraging your time and increasing your value. Time is you most valuable asset. When you mistreat this or misunderstand it you will never get rich. People with this mentality fail to understand the concept of ROI. They will spend an hour clipping coupons or arguing with a store manager to save twenty cents. Meaning they are getting paid twenty cents an hour, that’s how much they value their time. Which is why they will never get rich.

You can’t save yourself rich. Only by acquiring large flows of money can you do so. But to acquire large flows of money you must take risks and value you’re time. You must ruthlessly analyze your ROI on all of your business ventures. And guess what? Waiting in line for an hour for the free sandwich or taking twenty minutes to cut coupons have horrible ROIs.

The Entrepreneurial Route

There is a better way. The entrepreneurial route. In the entrepreneurial route you leverage your time (which you understand is your most valuable asset) and have your time work for you. You either increase the value of your time by learning skills or you have something that works in place of you for your time like a book or online course you sell. Poor people value their money while rich people value their time. Let me say that again

Poor people value their money while rich people value their time.

It may seem weird as you would expect rich people to value their money more than anything but if that was the case they would have never gotten rich in the first place. Think about it this way. I want you to imagine a billionaire. Now I want to imagine that billionaire waiting in line for a hour for a free sandwich. You can’t right? And why?

Well most would say he doesn’t have to worry about free things because he’s rich but they would be missing the bigger picture (and thus remain poor). He wouldn’t do it not because he values his money too much to spend it but because he values his time too much to spend it in such a way. Remember if you wait and hour for a free five dollar sandwich you are effectively getting paid five dollars an hour willingly.

Value Your Time

You must analyze everything in your life for the ROI (return on investment) that it has. For example I know many who spend eight or more hours working on their yard every weekend. Let’s break this down for one hundred bucks they could have a lawn crew come in and do a better job of working their yard for them. So they are spending eight hours working when they could spend one hundred to have experts do it for them. That breaks down to twelve dollars and fifty cents an hour they are valuing their time at. Not very high.

Meanwhile spending that time on a book, product, site, or learning a skill has the capacity to make you nearly infinite amounts of money depending of a few key factors. Money invested in your blog, book cover, or true education has the capacity to make you back far more than you put in.

Every time you go to do something I want you to calculate it’s ROI, now if it’s something like spending time with your kids or going out then no because the ROI has little to do with money. But whenever you are mowing the lawn, clipping coupons, or doing anything related to work and saving money. Calculate it. You will find that most of the nickel and dime strategies have no value for time. And that they will always keep you poor.

Summary

You can’t nickel and dime your way to riches, it just isn’t possible. You must leverage your time and increase your value to ever have a shot at being rich, with the former being even more important than the latter. Both acquring debt and nickel and diming are failed strategies that will keep you poor. Remember the poor value their money over their time and the rich value their time over their money. Understand which one is more important.

You can always make more money. Find ways to leverage your knowledge and do so. But you can never get more time. So spend that time in things that are worth it. Things that have the capacity to give you back more than you put in or are enjoyable. Have fun and work hard at things that can give you back your time’s worth. That is the way to get rich, not nickel and dime strategies.

If you have any questions you would like to see answered in a future post send them to me at charlessledge001 (at) gmail (dot) com. If you found value in this post then I would encourage you to share this site with someone who may need it as well as check out my books here. I appreciate it. You can follow me on Twitter here.

-Charles Sledge