Employees don’t get rich! February 14, 2008Posted by shaferfinancial in Uncategorized.
Tags: education, Journey, Shafer Financial Academy, Wealth
This is the third wealth creation strategy and the one that requires life changing commitment. No one can look at the American wealth statistics and not note the biggest difference in wealth is between folks who are employees and folks who are self employed.
Median amount of net worth for employees= $67,200
Median amount of net worth for self employed= $335,600
Yes, the self employed are 5 times as wealthy as employees.
Why is that? Well #1 that is how capitalism works. Employers leverage the excess value their employees create. If you have 10 employees and each creates $1,000 in excess value each month then you make a monthly profit of $10,000. But it goes much further than that, because many of the self employed have no employees. Here we look at the tax laws. Currently the tax laws favor the self employed whether they incorporate or not. They can expense many additional items that an employee can’t. Finally, the financial discipline it takes to be on your own readily transfers to wealth creation.
Now, this third step is a big one for most folks. I don’t recommend it for everyone. But it should really be considered.
Even if you don’t end up self employed, if you put the first two strategies to work for you, your wealth creation will be intensified.