Often labeled as a “get rich quick scheme” or “money for nothing”, nothing could be further from the truth. Internet marketing relies on extracting value from the dissemination of knowledge or digital products. There is truly a massive value proposition here in the fact that you can create a digital product once and sell it many times over. However, there are many competitors creating information overload and information has an increasingly short “shelf life” as the market demands more current and entertaining types of information. The value of the information itself is only a small part of the challenge of internet marketing. The greater portion is getting it in front of the right audience at the right time and at the right value proposition.
Generally, the most financially beneficial forms of internet marketing are those that use knowledge or digital products in combination with the sale of products or services consumed in the “real world”. This allows for repeat transactions. In this model, the internet marketer is providing constantly changing digital content to keep customers returning to their site for guidance on products to purchase. In general, the most successful internet marketers develop expertise in a niche market and have technical skills such as blogging, videocasting, or podcasting. In addition, they develop soft skills such as personal branding, influencing and networking.
Sometimes, the value that is created is from the direct sale of a product or service provided by the marketer, but more frequently, the financial benefit is received as a referral from the ultimate provider of the product or service to the marketer. This is what differentiates an internet marketer from an internet entrepreneur.
Think of an internet marketer as a type of digital broker, matching buyers and sellers together through a digital medium. In addition to the soft-skills needed, the marketer must be knowledgeable of social media platforms, search engine optimization procedures and affiliate marketing programs in order to successfully get their information to audiences and market. They must constantly develop, evaluate and improve digital marketing campaigns based on data analytics such as website searches, email opens, conversion to sales, links followed and buyer demographics.
An internet marketing WBS can be especially fulfilling for those who like the immediate gratification that an increased number of followers, views and hits brings. This is particularly true for introverts, who do not have to “personally” be on camera. If you enjoy creating new content and working behind a computer to evaluate the results of your efforts, this could be a relatively low-cost way to start up a high-value business.
Don’t be fooled, this like any other WBS comes with, ongoing expenses associated with podcasting, web hosting, advertising, video editing, graphic design and so on. As a result, you must pick a niche you enjoy so that you are willing to spend the amount of time required for content development and management.
For those who are more risk averse, you can begin your internet marketing business in your spare time while using your regular job to pay the bills. The most important advice for this WBS is to research and plan the approach to your niche before launching anything. Ensure that you have a long list of content ideas and marketing programs scheduled in advance.

The Marketing Technology WBS takes advantage of the leverage in value that technology can create. You create wealth by being the first to inform, popularize or introduce the new technology to the supply chain. Most successful technology marketers have strengths in communicating complex subjects and their value in simple terms. This takes tremendous critical thinking skills to understand the potential benefits of the technology and communication skills to relay the benefits to the buyer. Given these skills are rarely found together, there exists a potential to extract a high percentage of the total value for oneself.
As an added benefit, technology does not require a percentage of the business ownership. By making technology your partner and avoiding the cost of production, the cost of entry to the market is low. The critical element is finding a technology to promote which gives you great confidence in its ability to create value. This confidence is necessary to help you overcome market skepticism regarding the increased time, value, efficiency, etc. that is promoted by the technology.
Many opportunities for technology marketing can be found in the energy industry, medical field, or process improvement for manufacturing. The WBS lends itself to both broad technology improvements such as electric vehicles or in finding a niche market such as conversion of propane to electric forklifts. The process for either is the same – constant vigilance for needs in the respective markets where technology can boost productivity and profits or reduce cost and completion time.

In an age on the verge of the internet of things, digital currency and the metaverse, there is no shortage of technology applications to create value. The market is hungry for people who can recognize the value of these technologies and apply it to their specific situations to improve business competitiveness or personal lifestyle.

The Services Broker wealth building strategy builds on the value created when supply and demand of essential and high value skills are brought together. As the intermediary, you enable the parties to create synergistic value for society and extract a portion of that benefit for yourself. A successful services broker will be highly cognizant of the end-user’s needs and exactly how the supplier’s skills can optimally fulfill those needs. More importantly, the services broker will be highly adept at communicating the value proposition to the end-user in a more efficient and effective manner than the supplier. A services broker is an expert in knowing what a skill is “worth” in a particular situation. Services brokers are always on the lookout for new applications of skills and niche markets that can command high commission or referral fees. Vision casting, communication and networking skills are essential to the success of services brokers.

Services brokers may include sports agents, lobbyists, publishers, property managers, marketers, executive recruiters and so on. Brokers will typically earn a referral fee from the service provider, but may sometimes earn a fee from the end-user. Referral fees based on a percentage of the revenue earned by the supplier can be particularly lucrative. This wealth building strategy lends itself well to providing residual income without additional time. For example, a sports agent may earn an initial fee for the placement of an athlete and a residual percentage for the term of the athlete’s contract.

Commodities are consumable and as such, create a renewable source of revenue for the broker with each cycle of purchases. This makes relationship building crucial to the commodity broker. Having the right commodity at the right time increases the value brought by the broker. As such, commodity brokers have a vast network of contractual relationships in place with both suppliers and end-users and frequently monitor the projected needs of the end-users.

Commodity brokers may include chemicals, fuels, energy, industrial gases, agricultural products, and so on. Brokers will typically earn a commission from the supplier based on a total value of the transaction, but may represent either the buyer or the seller as an agent. Repeat business from the same sources builds wealth quickly over time in this strategy as each subsequent transaction typically requires less personal time.

The Business Broker wealth building strategy builds on the value created from the promotion and marketing of a business for sale.  As the intermediary, you enable the parties to determine a mutually agreeable value and terms for the business and extract a portion (typically 10%) of that value for yourself.   A successful services broker will be highly cognizant of the financial value of the business, including projected sales, expenses, reputation, and staff talent.  More importantly, the services broker will be highly adept at communicating the value proposition to the buyer in a more efficient and effective manner than the seller.

Business brokers are always on the lookout for consumer trends, government regulation, community growth and developing markets that generate turn-over of businesses.  Listening, financial analysis and influencing are critical skills for a successful business broker.  Giving an honest evaluation of a business’ market value to an owner with long-term emotional investment takes as much compassion as it does calculation.

Business brokers may focus geographically or on a particular industry segment.  This focus allows the broker to understand market dynamics and participant more fully, to maximize the potential for matching a buyer and seller.    

The Sales wealth building strategy is one of the oldest, most developed and most successful value creation mechanisms in history.  The primary goal of this wealth building strategy is to promote the benefits and value of the services offered by the company or individual and obtain commitment from a buyer to purchase.  Success in this field is greatly determined by knowledge of the services offered, understanding of the client’s needs and a tremendous amount of persistence.  Outstanding service sales professionals typically earn many multiples of the average salary by understanding how to manage the sales cycle for the services offered and objections tendered by the client. 

The value that can be extracted in this wealth building strategy is virtually limitless.  The benefit of the WBS is that fulfilment is not expected, so the sales professional can move on to closing additional transactions.   The greater the value of the transaction, the greater the financial benefit for the commissioned sales professional.

Another benefit of the sales service WBS enjoys is the range of target markets that can be explored.  The sales professional can target individual, commercial or industrial markets, which each may have specific benefits for the sales person’s personality and skill set. 

Sales professionals work for firms such as financial services, real estate brokerages, engineering, environmental, architectural, video production and personal services.  Since the sales professional works primarily for another party, this WBS lends itself to secondary income streams using the same sales skill for another product or service industry that does not create a conflict of interest.  A financial services advisor (sales person) may work weekends for a local car dealership.  This additional income can then be used for investment purposes or as seed money for another opportunity.

The Sales wealth building strategy is one of the oldest, most developed and most successful value creation mechanisms in history.  The primary goal of this wealth building strategy is to promote the benefits and value of the services offered by the company or individual and obtain commitment from a buyer to purchase.  Success in this field is greatly determined by knowledge of the services offered, understanding of the client’s needs and a tremendous amount of persistence.  Outstanding service sales professionals typically earn many multiples of the average salary by understanding how to manage the sales cycle for the services offered and objections tendered by the client.

The value that can be extracted in this wealth building strategy is virtually limitless.  The benefit of the WBS is that fulfilment is not expected, so the sales professional can move on to closing additional transactions.   The greater the value of the transaction, the greater the financial benefit for the commissioned sales professional.

Another benefit of the sales service WBS enjoys is the range of target markets that can be explored.  The sales professional can target individual, commercial or industrial markets, which each may have specific benefits for the sales person’s personality and skill set.

Sales professionals work for firms such as financial services, real estate brokerages, engineering, environmental, architectural, video production and personal services.  Since the sales professional works primarily for another party, this WBS lends itself to secondary income streams using the same sales skill for another product or service industry that does not create a conflict of interest.  A financial services advisor (sales person) may work weekends for a local car dealership.  This additional income can then be used for investment purposes or as seed money for another opportunity.

The Retail Franchise wealth building strategy is one of the highest probability methods for building wealth. This is because someone has already proven the process successful. Franchises typically provide demographic and site location support, turnkey equipment and operating procedures. Success at this wealth building strategy is based on the ability to follow the process, optimize efficiency and manage performance to expectations. The more efficiently the operation is run, the more profit the franchise will produce. Typically, successful franchise owners leverage their success with more and more of the franchise stores. Ultimately, they replace themselves with delegates and processes.
Retail Franchises include cell phone stores, auto parts, batteries, clothing stores, book exchanges and any number of other things that you can imagine. For almost any product that you could be interested in, someone has most likely already developed a successful marketing and delivery process for you to exploit.
The downside of this strategy is that there is usually a substantial investment needed to get started. This may come in the form of an up-front payment or a percentage of ongoing profits, or both. Offsetting this cost is the time saved, sometimes years, from having to develop a successful process and the avoided cost of failed investments during that time. Pursuit of this strategy also requires a personality that is open to partnering and sharing confidential information as the franchise company will remain involved to protect their brand reputation.

The thought leader builds wealth by first promoting a popular idea, typically on social media and then using that platform to monetize that popularity.  The thought leader does not really implement any action.  Rather, the thought leader reviews all of the available information on the topic and assesses the situation and provides opinions.  The value provided is to inform the general public in relation to trends, ideas, policies or newsworthy events.  Television newscasters, sportscasters, social media phenoms, and reporters are all types of thought leaders.  The thought leader spends full time researching, analyzing and assessing situations that the general public feels is valuable but not able to spend time on due to other commitments.

Thought leaders build wealth through referrals, subscriptions, advertisements, affiliate marketing, product endorsements and consulting fees.  While information is the tool of the thought leader, the product that they sell is viewership or readership.  The more succinctly and creatively the information is delivered the greater the audience and the more value the thought leader can extract.  Successful thought leaders cultivate extensive sources of information and solicit feedback from their audience to continually craft provocative messages.   

One of the benefits of the thought leader wealth building strategies is that there is virtually no initial cost to get started, thanks to social media.  The corresponding down-side is there is a world of competition and even getting noticed in the first place takes a significant amount of knowledge in social media marketing and how to set yourself apart from the crowd.

The Athlete wealth building strategy is one of the most stressful and difficult to achieve.  It takes extreme levels of discipline and physical conditioning to even make a living as a professional athlete. Most professional athletes play for minor league teams, or compete in competitions for prize money, model, run camps or provide personal coaching.  Athletes include fighters, cyclists, baseball, basketball, soccer, football, and tennis players, skateboarders, and many other professionals that make their living performing physical feats to impress audiences.

In addition, there is a significant salary gap between the highest paid athletes and the lowest paid athletes. While the average career earnings of an NBA player are $24.7 Million, the average annual salary for a professional athlete in the US is just under $52,000.  In addition, 78% of professional athletes go broke within three (3) years of retirement.  This means that athletes must not only be highly skilled at their respective sport, but they must also make prudent financial decisions because there is a physical limit to the length of their careers.

In order to become a professional, athletes need years of high-quality sport specific training.  The focus required to obtain and maintain peak performance means that much of the other functions of the process must be outsourced to agents, publicists and financial professionals adding cost and complexity.  On the up-side, professional athletes typically are highly passionate about their sport and competitive by nature.  The most successful professional athletes can leverage the notoriety they gain during their playing years to earn additional royalties after they stop playing through books, endorsements, motivational speaking, coaching and public appearances.     

The Performer wealth building strategy is one of the most difficult to achieve.  It takes extensive training in the performers specific art in order to become a professional and the extent of wealth to be gained depends upon the audience’s preferences.  Performers include all professionals that provide entertainment for audiences and include most notably actors, artists, musicians, comedians, street performers and thespians. 

The average salary of a performer in the United States is just under $59,000 per year.  The most successful performers make the audience feel emotion and relate to the performance.  The more connected the audience feels to the performer, the greater the popularity of the performer and the more financial benefit the performer can extract.  The key ingredients to success are skill and persistence and a willingness to make your life completely open to the public.

Due to the level of focus needed to obtain and maintain performance capability, performers typically must outsource other functions of career and personal management to agents, publicists, and financial professionals, adding cost and complexity. 

On the up-side, performers can many times maintain long careers in their chosen profession and have many options to leverage their notoriety into residual income streams.  They also have the possibility of recording their performance once and selling it multiple times and addressing fans in mass through social media.  This allows an unprecedented level of connection between performer and audience.

Fiction writers inspire our imagination and entertain us with stories that range from drama, comedy, science fiction, fantasy and mystery.  This wealth building strategy is based on the value created by people’s desire to be transported from their own day-to-day reality and immersed in a captivating story.  The most successful fiction writers make the reader feel emotion and relate to the story.  The more connected the reader feels to the story, the greater the popularity of the writer and the more financial benefit the writer can extract.  This generally means that when a writer finds success in a specific genre, they stick with it. 

Fiction writers can maintain a long career with new readers being born every day.  JRR Tolkein’s Lord of the Rings was written in 1948 and has spawned a wealth of revenue streams including books, movies, toys, memorabilia and merchandise.  In 1978, the author died with an estimated net worth of $678 Million.  In 2001, his estate was still making $67 Million per year on the book sales rights alone.  This success is generated by a fan base that passes down their love of the masterpiece to future generations.

For every mega-success however, there are hundreds or thousands of writers that struggle to make any income from their passion.  The keys to success here seem to be having a high level of motivation to write and also writing consistently.  Successful fiction authors have expectations and ideas for writing more than just one book.  This is because regardless of the quality of the idea, the process of writing, publishing and marketing one’s first book will almost undoubtedly be lower quality and more expensive than the second and third.    Publishers want to have confidence in consistency of quality and volume.  Readers also need to build an expectation of getting the next installment. 

Speakers build wealth by communicating emotion and information to audiences in useful and memorable ways.  The most lucrative areas for speakers are motivating, training and informing.  The best speakers incorporate all three of these components into their presentations.  The financial benefit of the speaker is directly related to the amount of influence that the speaker can apply to the audience.  The more the speaker influences the audience to the desired action, the greater the financial benefit.

The primary benefit of this wealth building strategy is that there is very little initial investment required to get started.  The corresponding downside is that there is a wealth of competition.  Speakers must therefore find ways to stand out among the crowd.  One of the best methods for reducing this competition is to focus on speaking at public events, which is a fear of over 75% of the population.    

Generally, speakers charge a fee for each speaking engagement.  These fees range from $1,000 to $100,000 per event depending on the popularity of the speaker.  This means that speakers must find ways to gain a following with repeat business.  To that end, many speakers target conference promoters and corporate clients that effectively aggregate listeners.  Other speakers outsource this function to speaker’s bureaus and focus their efforts on producing and delivering outstanding presentations. 

Frequently, speakers record their presentations for future digital sales.  The old adage of “do it once and sell it 100 times” definitely applies to the art of speaking.  A half a dozen outstanding presentations can provide a career for a public speaker, especially if the material is in an area that must be updated at least annually. 

Entrepreneurs are the apex predator of the wealth building process.  Entrepreneurs assume the risk of taking an idea and turning it in to a reality by combining all the people, finances, equipment and processes needed to form a complete supply chain.  Manufacturing entrepreneurs focus their attention on combining these resources to produce products in mass for sale to wholesale distributors.  These goods include automotive parts, baked goods, toys, aircraft parts, clothing and any number of other tangible products. 

The most successful manufacturing entrepreneurs have outstanding project management skills and process evaluation skills.  They are visionaries with internal drive and discipline to get across the finish line.  Much of the success within the manufacturing sector depends on producing a highly desirable product with attractive margins and long term demand.  Manufacturing Entrepreneurs target these opportunities and seek to extract as much financial gain from these opportunities as possible through process improvement and economies of scale.  Manufacturing entrepreneurs seek to leverage their wealth through expanding manufacturing facilities in new geographic markets.

One of the biggest challenges a manufacturing entrepreneur faces is fundraising the substantial capital that is required to purchase physical assets for production.  Bank lending is generally limited without a history of revenue from operations and the specific nature of manufacturing machinery.  Entrepreneurs must be very resourceful and partnership oriented.    

Entrepreneurs are the apex predator of the wealth building process.  Entrepreneurs assume the risk of taking an idea and turning it in to a reality by combining all the people, finances, equipment and processes needed to form a complete supply chain.  They also reap the greatest rewards.  Service entrepreneurs focus their attention on combining these resources to provide services, such as marketing, promotion, design, consulting, finance, brokerage, legal, medical or other high value activities.  The type of service is dictated by the passion of the entrepreneur.

The most successful service entrepreneurs have outstanding people management and process design skills.  They are visionaries with internal drive and discipline to get across the finish line.  Much of the success within the service sector depends on providing a highly needed or unique skill with high fees and long-term demand.  Service Entrepreneurs target these opportunities and seek to extract as much financial gain from them as possible through marketing, recruitment and training others to perform the services.  Service entrepreneurs seek to leverage their wealth through promotion of employees to owners, implementation of systems and franchising.

One of the substantial benefits of building a services business is the low cost of entry.  This benefit is offset by the time investment needed to develop necessary skills and a team.  One of the biggest challenges a services entrepreneur faces is attracting the talent needed to grow the business.

Entrepreneurs must be very resourceful and partnership oriented because without a mechanism to delegate, the entrepreneur can only earn as much as the fee multiplied by the number of hours they spend.     

Entrepreneurs are the apex predator of the wealth building process.  Entrepreneurs assume the risk of taking an idea and turning it in to a reality by combining all the people, finances, equipment and processes needed to form a complete supply chain.  They also reap the greatest rewards.  Technology entrepreneurs focus their attention on combining these resources to create a technological solution to a problem or fulfill a need.   Technology entrepreneurs value the reliability of systems and lack of emotional interaction needed for people management.  Technology entrepreneurs can be found creating businesses that focus on virtual reality, cyber security, the metaverse, battery storage, drone applications, artificial intelligence and any number of other specialized technology applications. 

The most successful service entrepreneurs have outstanding analytical skill and systems management skills.  They are visionaries with internal drive and discipline to get across the finish line.  Much of the success within the service sector depends on the entrepreneur identifying a highly needed or unique application of technology and long-term demand.  Technology entrepreneurs target these opportunities and seek to extract as much financial gain from them as possible through applying their knowledge of the technology to optimize the supply chain of the product or service.  Technology entrepreneurs seek to leverage their wealth through reinvesting in their systems and building as quickly as possible to economies of scale and market saturation. 

One of the downsides of this wealth building strategy is the constant need to keep improving the technology to stay ahead of competition.  Explaining the benefits of the technology to naturally skeptical investors and the market in general is also a challenge.  The stronger the vision casting and communication skills that a technology entrepreneur has the greater the financial benefit they can extract.  There may also be regulations and governmental approval processes that may create hurdles for new technologies.    Technology entrepreneurs must have absolute confidence in their technology but also be willing to recognize the value that non-technical professionals bring to the table in marketing, sales, fundraising, and negotiations.  Failure to collaborate with these purveyors of soft skills could mean lower market value, longer development time and less capital and ultimately less financial benefit.    

Entrepreneurs are the apex predator of the wealth building process.  Entrepreneurs assume the risk of taking an idea and turning it in to a reality by combining all the people, finances, equipment and processes needed to form a complete supply chain.  They also reap the greatest rewards.  Internet entrepreneurs focus their attention on combining these resources in the digital marketplace to either provide or enable products and services.  An internet entrepreneur does not maintain a physical storefront.  Rather the distribution of their products is performed via third-party delivery or strictly electronic delivery from computer to computer as is the case for information-based products. 

It is also common for internet entrepreneurs to be in the business of providing digital business support services such as web hosting, cyber security, financial transactions, web searches, database management, data collection, social media platforms, video casting, multi-player gaming or other strictly digital business.  These entrepreneurs make it easier for everyone to do business digitally and are finding more creative ways daily to expand the digital marketplace. 

The most successful internet entrepreneurs have outstanding research skills and a profound understanding of software, hardware and existing digital tools.  They are visionaries with internal drive and discipline to get across the finish line.  Much of the success within the service sector depends on the entrepreneur identifying a highly needed or unique application of internet or digital tools to a real-life problem.  Internet entrepreneurs target these opportunities and extract financial gain through application of their knowledge to optimize the supply chain of products or services.  For example, internet entrepreneurs utilized web and cell phone applications to streamline food and home-goods deliveries during the pandemic.  Internet entrepreneurs seek to leverage their wealth through developing an application one time that can be sold many, many times.   They also look for opportunities to build additional tools to bolt on to their solutions that attract more users. 

One of the downsides of this wealth building strategy is the constant need to keep improving digital tools and processes to stay ahead of competition.  Once a profitable business model is created, it can be copied rather quickly and at much lower cost than the original.  These copy-cats can undercut the margins. 

The professional service provider is the literal workhorse of the wealth building strategies.  The service professional obtains a highly valuable skill and exchanges application of that skill to an employer in exchange for a paycheck.  Some of these professionals include architects, doctors, dentists, engineers, educators, lawyers, managers, pilots, programmers and a host of others.  The selection of the profession is based on passion and interest.

This strategy is a tried-and true low risk, high reward endeavor.  The employee need only focus on the application of their skill, keeping their living expenses low and investing the difference at a reasonable rate.  Time will take care of the rest.

The downside of this wealth building strategy is the time and typically cost that it takes to master a professional skill.  Many of these professions require expensive and lengthy advanced education.  A good portion of that cost can haunt the individual for years afterwards and reduce the important early investments needed to produce wealth over time.  Also, many employers require non-compete agreements that marginalize the professional’s ability to perform the service on their own as a second source of income.  Employers also try to set fixed salary levels and press the employee to work as many hours as possible. 

Services professionals leverage their wealth by using similar skills in complimentary areas.  For example, an engineer might use project management skills to act as a general contractor on two house builds per year.  Or a real estate attorney might use their negotiation skills to structure business sales.

Successful services professionals are consistent above all else.  They regularly look for opportunities to upsell their skills at higher rates to new employers and use their skills in other areas instead of working overtime hours for a set salary.  They diligently monitor their expenses and investments regularly and set goals in both these areas.  The combination of high income, moderate expense, and reasonable investments over time creates an impenetrable sense of security unmatched by most other wealth building strategies.

The trades professional is the literal workhorse of the wealth building strategies.  The tradesman obtains a highly valuable skill and exchanges application of that skill to an employer in exchange for a paycheck.  Some of these professionals include welders, electricians, automotive repairs, building contractors, medical technicians, dental hygienists and a host of others.  The selection of the trade is based on passion and interest.

This strategy depends heavily on the energy level and the discipline of the individual.  The employee need only focus on the application of their skill, keeping their living expenses low and investing the difference at a reasonable rate.  Time will take care of the rest.

The upside of this wealth building strategy is the relatively short time and cost associated with obtaining the trade skill.  Many of these trades only require 12-24 months of education or on-the-job training. Also, there is generally very little responsibility that the trades professional must take for the business success.  The down-side of this wealth building strategy is that employers tend to manage work output closely, pay hourly and can terminate employment at will.      

Trades professionals leverage their wealth by using the same or similar skills outside their daily work.    For example, an auto mechanic may spend evenings and weekends repairing cars out of their garage.  A medical technologist may provide contract labor for another hospital on off days from their employer.   

Successful trade professionals are highly energetic and work lots of hours.  They regularly look for opportunities to upsell their skills at higher rates to new employers and use their skills in other areas.  In order to build wealth, a conservative lifestyle and investment of secondary income is a must early in the career in order to allow time for the savings to multiply.  Delayed gratification and thriftiness are valuable tools for the trade professional.  They must also diligently monitor their investments avoid tapping into them.  The combination of moderate income, low expense, and reasonable investments over time creates a sense of self-reliance and work-ethic unmatched by most other wealth building strategy.

The real estate flipping wealth building strategy is popular and effective, although it isn’t as easy as it looks on television.  The real estate investor seeks properties owned by distressed sellers that need substantial maintenance.  Value is created when the property can be purchased and repaired to retail condition at a cost lower than the subsequent sale price.  The total cost of the project also includes insurance and interest paid while the property is undergoing repairs and transaction costs such as appraisals, bank fees and realtor commissions.     

Real estate flippers require substantial project management and negotiation skills.  Wealth is maximized when the purchase price, sales price, contractor fees and materials are all negotiated favorably.  Value is also increased when part of the work is completed by the investor.  For example, the investor may lay the new flooring and avoid the labor cost or find a buyer for the property without a realtor, saving the commission.  Wealth can also be leveraged by maximizing the amount of the project that can be financed.

Some of the downsides of this wealth building strategy are that material and labor costs may increase, the market value of homes decrease or interest rates increase.  The repairs could also take longer to complete, thus increasing the carrying costs.   The best method for mitigating these risks is to conduct effective due diligence and analysis in the beginning and adjust the purchase offer accordingly. 

Real estate flippers can leverage their wealth by reinvesting profits into new projects immediately.  This minimizes tax implications, keeps the money working and keeps contractors working.  It also increases the number of projects completed and the profit that goes with it.

Real estate flippers must have strong problem solving skills and patience to be able to manage the everyday crisis’ that come with this wealth building strategy.  However, there is also the satisfaction that comes from seeing an underutilized property returned to profitable shape.  Real estate flippers are also responsible for creating wealth for the related contractors, bankers, attorneys, realtors and appraisers that are also involved.

The real estate sales wealth building strategy is extremely popular among ambitious individuals with strong sales and networking skills.  Realtors earn commissions through the listing and sale of properties.  Generally, the commission is 3-3.5% per side of the transaction.  Thus a $400,000 home that is listed and sold by a realtor may result in a commission of $24-$28,000 making this a lucrative proposition depending on the volume of transactions and values of the homes. 

Realtors can maximize the financial benefits they receive by increasing the number of transactions.  The most successful realtors hire specialists who assist them with marketing, lead generation, market analysis, open houses, and administrative support.  The realtor then has time to conduct face-to-face and contract negotiation functions.  The objective is to maximize the number of transactions that can be obtained and closed with efficiency.  The increase in transaction commissions pays for this additional staff and then some.          

The primary benefit of the real estate sales wealth building strategy is a limited educational requirement.  A realtor can be trained, pass the required exam and be earning commissions rather quickly.  The primary downside of this wealth building strategy is that realtors are always on call for their clients and potential clients.  This is an inherent issue with any sales role and realtors must incorporate downtime or risk burnout. 

Realtors must have strong organizational skills and multitask effectively in addition to having knowledge of financing options, legal issues and market dynamics.  In addition, they must have sensitivity to help manage the emotions and expectations of their clients, who are undergoing unusual stress during a home sale or purchase.    

The real estate rental wealth building strategy is popular and effective.  In this strategy, the investor purchases a property to fix up and rent long term.  Ideally, the real estate investor seeks properties owned by distressed sellers that need substantial maintenance.  Value is created when the property can be purchased and repaired to retail condition at a cost lower than the subsequent appraisal price.

Wealth is built through this strategy in several ways.  First, is the value of instant equity.  This is the difference between the purchase price and the appraised value.  Ideally, this value is 20% in each property so that the investor can pull their initial investment out and cycle it into another rental.  Second is the reduction in mortgage that is paid by the renter, creating more value in the property.  Third is the excess cash flow earned from the rent value above and beyond the expenses of mortgage and maintenance.  This increases over time as the rent increases and the mortgage decreases.  Fourth is the appreciation of value of the property over time.  Fifth is the tax deduction benefits offered by real estate.       

The main downside of this wealth building strategy is that the wealth is generally locked up within the property as equity.  Also, there are a number of fees associated with financing and maintenance that can get out of hand if handled improperly.  Additional fees are required if the investor does not want to manage the renters directly.  A good strategy here is to manage the properties yourself until rents can be increased and applied towards third party property management fees.   

This wealth building strategy can be pursued passively through investment in rental properties that have already been renovated and placed with a property manager.   However, this greatly reduces the return on investment and increases the amount of cash needed.  Rental investors can leverage their wealth by reinvesting profits into new rental properties.  The more properties the investor owns, the greater their flexibility of financing options and leverage with tradesmen. 

Business investors may be either passive or active.  This wealth building strategy creates value for the passive investor through the purchase of ownership shares in an existing business that is already successful but needs access to capital.  In this model, the business investor uses their analytical skills to conduct due diligence and either invest the money directly or creates a consortium of investors.  Once the up-front work is done, the investor is generally silent in the business decisions and earns a rate of return.  This strategy requires substantial capital or access to capital to get started and the investor is at risk if the active managers make bad decisions.

The active business investor uses their analytical skills to identify a struggling business that would prosper if the investor were to apply their skills to the situation.  Therefore an investor with sales and marketing skills will target a different opportunity than an investor with production and operations skills.  An active investor makes ongoing decisions about the management of the company and might be termed a turn-around artist.  This option allows for a low cost of entry but is quite time consuming for several months or years depending on the size of the business and the extent the investors skills are needed.

In either model, the primary skill of the investor is to evaluate the potential of the business and make the appropriate investment to unlock its potential.  The more astute the investor at this function, the greater the return.  Business investors leverage their value by making the required investment, obtaining the resulting ownership interest and then moving on to the next investment.  This builds a portfolio of businesses.

The financial markets investor wealth building strategy is often misunderstood as being and “easy” method to make a fortune by simply picking the right stock at the right time and then reaping tons of profits.  While this may happen, the likelihood is low because there are so many variables at the “right time” that choosing the “right stock” is tantamount to gambling.  Successful financial market investors take risk, which is the hallmark of this wealth building strategy, however they use their knowledge of the markets and financial products and strategies to mitigate that risk.  A mantra of the professional investor is “You only have to be right 51% of the time.” and they work very hard to obtain that 1% advantage.

As with any wealth building strategy, the true secret lies in discipline and persistence.  The actual execution of the transaction or trade only takes 1% of the time and effort.  The remaining time is spent in research and analysis. 

Financial markets investors may focus on commodities, stocks, loans or some type of derivatives of these products.  Regardless, the investor must know the metrics of their chosen investment strategy, the market dynamics and interestingly a profound knowledge of psychology.  The professional investor must be a master of their emotions.  Hunches and fears are typically the reason an investor loses their 1% advantage and more.

Financial markets investors leverage their wealth by borrowing funds at a low interest rate and reinvest it at a higher rate.  This mechanism means that he investor’s ability to earn wealth is increased by the capital they have access to invest.  The difficulty in becoming a financial investor is obtaining sufficient seed capital to earn more profits than living expenses.

Many people do not consider a military career as a route to wealth because of the limited salary earned.  However, this is far from reality.  There are numerous ways the military sets the stage for financial success.  In particular, the military typically stops the path that the individual is on and re-sets it with a focus on self-discipline, which is the most critical factor in any wealth building strategy.  In addition, the military provides excellent benefits such as medical and retirement funds that help prevent people from experiencing the many downfalls that can occur in the public sector.

The military provides a strong base from which to learn many valuable career skills.  Once principal benefit of the military is the ability to use these skills after hours and on weekends to earn a second revenue stream for future investment.  The military is also a great source of funding for secondary education to apply in a professional career such as medicine, engineering or law.  While the base salary is somewhat lower than alternative public sector jobs, there are very few platforms which are better designed to bring out excellence and drive in individuals.

Military careers can be short, such as a four-year enlistment.  In this model, the individual is gaining a jump start on their preferred civilian role.  Alternatively, a military career can be taken to retirement of 20+ years.  In either instance, there are still many years left to optimize the skills learned.  The greatest challenge military retirees face is the transition from a structured reward-based environment to one in which they must chart their own path to success. 

Any military career should be embarked on with a plan towards the objectives of one’s second, civilian career.  Successful military professionals begin to build businesses, real estate portfolios and financial investments well before retirement.