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How to “work a regular job” and still be as wealthy as a business owner

As someone who has been through the ranks of a salaried employee, a small business owner and an investor, I can tell you that those ideas are simply not true. I firmly believe that being a salaried employee can create wealth. There have been times when I have envied salaried employees who have full-time jobs because they have advantages in creating wealth that small business owners like me do not have. Those advantages are:

1. Predictable cash flow

Salarymen work full-time and most of their income is a fixed salary that they receive every month. Some may have commissions or other compensation that varies depending on the quality and quantity of work. However, the proportion of income for most employees should come from a fixed portion. Many people may see this as a disadvantage. No matter how many companies they work for, their income remains the same. But I ask that we think positively and look at the bright side. Because this is the most important advantage of salaried employees in creating wealth.

Why? Because you know the future! Knowing your cash flow months or even years in advance makes it easier to plan your finances, savings and investments each month. And you are more likely to stick to your plan if you can control your spending. This is something that small business owners cannot do because income will fluctuate and many times it will not be as expected. For example, sales do not meet the target, projects have all sorts of problems, or even no problems at all but customers do not pay.

At this point, don’t think about how you can make a small salary. I will tell you that whether your income is high or low is not the most important thing in creating wealth. The two most important things are how much you save and how much you can invest to get a return. Most people, when their income increases, spend more money, which means they never get rich. Therefore, the key is planning, managing, and controlling yourself to follow the plan. If you don’t know where to start, read this article about financial planning first.  “Financial planning” must come before “investment planning”.

2. Same assets but more investment possible

Another advantage of salaried employees is that they don’t have to spend money to make money. Are you confused? Imagine that right now you have almost no money left, just a little bit left to survive and travel to work. But at the end of the month, you will still receive a salary.

But most business owners are not so lucky. Business owners “need money to make money.” For example, if there is no money to buy products to sell, there will be no sales. Or if there is no money to buy raw materials, pay rent, or wages, there will be no money to make money.

In this case, let’s say a salaried employee and a business owner have the same amount of savings. The salaried employee will have the power to invest almost all of his savings to generate returns, while the business owner will have to keep a large sum of money for business purposes.

When I was a full-time employee, I had less than 20,000 baht in my bank account. Most of my money was invested in stocks and mutual funds. When I got my salary, I would immediately transfer some money into my stock and mutual fund portfolio. However, when I started my own business, I couldn’t do that, so I missed out on a lot of investment opportunities.

But salaried employees must be careful with this advantage because it is a double-edged sword. When salaried employees do not have to spend money to make money, they do not have to save money. This is the problem that causes most people to have no savings. Therefore, planning finances and following the plan is very important.

3. There is a reinforcement helper.

The first advantage of salaried employees is having a fixed income. This brings with it the following advantage: the ability to borrow money. The English word for borrowing money is Leverage, which literally means a lever or reinforcement. That is the power of not having to use your own money. Let me give you one example. A few years ago, a friend of mine who was an ordinary salaried employee, did not have much knowledge about investing in the stock market or was not very keen on saving and investing. He decided to buy a condo for 5 million baht. He did not have 5 million baht, but he used some of his salary to pay the down payment, transfer, and pay the bank installments. A few years later, the condo had a market value of about 8 million baht. If he sold it, he would immediately have 3 million baht more in his savings account, which he could use to invest in other assets to generate further returns. This is the power of Leverage. (Investment has risks. Investors should study the information before deciding to invest. There are many people who have bought condos and lost.)

Let’s look at the business owner side. If you are just a small business owner with no fixed income, let alone a loan, it is difficult to get a credit card.

Now, since salaried employees can borrow money easily, it becomes a double-edged sword, as in either taking on debt to make it grow or borrowing money to create disaster in life.

In addition to these 3 points, there are actually other advantages such as welfare and bonuses, which vary from person to person. These are great accelerators of wealth if used correctly. As for business owners, in addition to not getting a bonus, they also have to pay for it. Speaking of bonuses, I once heard an English saying about windfalls (large sums of money that come unexpectedly) that says:

“Poor people often see windfalls as a way to have fun, while rich people see them as an opportunity to build wealth.”

This means that if you get a big bonus, would you use the money to buy a new car, a new phone, or choose to invest the money to generate returns that increase your income without waiting for your boss to give you a raise?

It is true that being a business owner has many advantages over salaried employees and may have more opportunities in many ways. But I wrote this article because I want salaried employees to try to look at the positive side and see that you actually have many advantages that can create wealth. Everything has both positive and negative. It depends on which side we choose to look at. If we choose to look at the positive side, we will see only opportunities and good things in life will follow.