6 Ways to Quit the Rat Race and Master Your Own Destiny

The term 'rat race' has been with us for some time now. The never ending cycle of too much work and too little money and free time is consuming the soul of our society. Western societies have grown wealthy, but still there seems to be a economical gloom in the media as well as in peoples hearts. One big reason for this gloom is that people are not very independent when it comes to money. Most people are bound to their jobs as their only means of income. Of course one can change jobs but then the same thing repeats itself. This doesn't really give much room to maneuver. So I've created a small list to help people start taking charge of their own financials and thus create more freedom to choose how you want to live your life.

Which one you want to be? (Picture from: tylermctavish.com)

1) Decide for yourself

This is the starting point. If you don't do this is is useless to read further. It is up to you to do the hard decisions that needs to be done. Many people never actually decide anything meaningful in their lives. They just do what's 'smart' or what is expected of them. In the end you have 100% of the votes on how to run the state of you. Many people want to lobby you to this or that direction and many advise might be even good ones. But when it comes down to it you are the one responsible to take charge and set your own course. Whining about circumstances, never getting a good chance or that you were too busy are self made excuses and you know it. You were just too afraid to make the decision so better to face it than hide from it. And no, it's not too late to make it now.

Do not be afraid. Go boldly and see how far the rabbit hole goes!

2) Work for yourself

If you work for a company your upside will always be limited. No matter how much work you do or how well you do it there's a limit on your potential gains. You get your paycheck and maybe some bonuses but that pretty much sums it up. If you work for yourself the sky is the limit. The downside of course is unlimited in both cases. You loose your job or go bankrupt. You can loose it all in both cases. Only the upside is different so why make other people rich and successful when you can do it for yourself.

 

You also need to know the difference between your profession and your business. When businessman Ray Croc, the man who made McDonalds what it is today, asked some MBA students what's his business is all the students chuckled and answered: "There's no one on the planet who doesn't know what your business is. It's hamburgers". Well they were wrong. Mr. Croc has always been in the real estate business. He owns the properties under the franchises in some of the most central places in this planet.

Understand the difference between your profession and your business. What you do every day might not be your business. Your business creates you income even when you're not working actively. You need to manage it from time to time but it's different from your profession. Your business could be real estates, companies you own, forest, stocks or other assets that generate you income.

3) Make money work for yourself

Most people work for money. Rich people make money work for them. That's why the rich get richer and poor and the middle class stay where they are. Most people haven't grasped the difference between asset and liability. They buy a car or a home and call it an asset. It might be but most cases it's not. An asset is something that brings money to your pocket. A liability is something that takes money from your pocket. So if you manage to use your car or home as a tool for money generation then it is an asset. Otherwise it is a liability.

To make it really clear and simple your personal financial statement should look something like this:

Income > Expenses

Yeah bitches do my dirty work!

Assets > Liabilities

But for most people it looks something like this:

Income = Expenses

Assets < Liabilities

Here's the simple truth why the rich get richer:

Income --> Assets --> More income

And what you most likely will do:

Income --> Expenses --> Stay where you are

You should start investing your income to assets that start to passively generate you more income that you can either invest onward or spend as you will since you can invest from your incomes and thus create a positive cycle that will make you wealthy. If you can create your personal cost structure so that you can start investing you'll be in better financial position than most and maybe quit your day job altogether.

4) Become financially savvy

If I only had more money my problems would go away! This is what most people think:              more money = less problems. 

Most people who get a sudden windfall like a lottery winning or an inheritance usually end up spending them in a short run and are financially where they started. What do you need to be rich? Money or assets. What do you need to stay rich? Financial education. Most people can read just fine. It is when it comes to reading numbers they go like: 'Math and accounting are not really my strong suit' or 'Talking about money is so boorish'. Finances and money are not really taught in schools. One needs to learn these things herself. One good trick is to start a investment portfolio with small sums. This way you have an incentive to study financial literacy and become more financially independent.

5) Balance your costs and income

Don't believe everything they say

It's not about earning millions. It's about earning more than you spend. Consumerism is so instilled in our modern society that when the shops close for the holidays we go: 'how are we going to survive now?' We're bombarded with lifestyle choices, ads, new 'can't-live-with-out-products' and dozens of different options to open your wallet and spend, spend, spend! One really needs to set her priorities straight and learn the value of money. Every purchase has an alternative cost. The cost is usually time or opportunities. Because time is money you usually end up working more if you buy more. The other cost is more hidden. Opportunities present themselves to us daily. If we have open mind and enough resources to tap into those opportunities we'll get tremendous boost for our way to become financially independent.

To be financially independent isn't about hogging money and wanting be rich. It's about the freedom that it entails. The freedom to choose for yourself. The freedom to dedicate your time and effort to the things you deem worthy. The freedom live your life as you will.

Oh by the way you need to make the sixth way yourself because every path is different and I can only give you some general tips how to go about it :)