Now that I’ve got your attention, the title is actually correct. Owning most things in the 21st-century tech-centric democratized world is like lighting your hard earned dollars on fire to enjoy the bright flames for a while.
The first item I’ll cover is a curious euphemism I hear being said known as a “depreciating asset”. By definition, an “asset” is something that has value today and is certain to gain value in the future. Note the word certain. This rules out a hot stock, a spec home, precious metals and currency in general. In fact, a stack of hundreds in your hand is actually decaying in value daily unless it’s leveraged to offset its own entropy. But let’s stay on track here about assets.
A true asset would be a well financed or wholly owned house in a decent neighborhood in a metropolitan city, viewed from a ten year or more period could be considered and asset. A low cost index fund across a ten or more year period is an asset. (the S&P 500 has shown predictable growth even when adding the great 2008 recession). A lessor known but high value asset is a cash value life insurance policy.
Where I’m going with this is that our culture, especially in the US is centric on consumerism. This is easily visible on big ticket consumer items like flat screen tv’s, electronics in general, cars, fashions and home furnishings.
I’m not advocating a Spartan lifestyle, but rather, a fresh look on how you trade your time for money towards the money supporting you or forever having to work to create more cash to support your purchase of non-assets.
I’m certain I was never told to “earn as much money as possible in the shortest amount of time and leverage what you keep into income producing assets.
In order to truly Master the Gig Economy, your plan should include investing time and money into the newest skills education and financial education and then channeling those valuable skills into high income producing activities, which can then be channeled into true assets that produce income for you so you no longer need to produce it yourself. Once your income producing assets provide enough cash flow to support your lifestyle, you are “financially independent”, meaning you no longer need to work to live, you now have the freedom to pursue activities that enrich the meaning in your life and perhaps free your mind to invent something wildly contributing to society!
Rethink what things in today’s world that can be acquired at a significant discount or leased or rented on demand. Consider large ticket items like cars, expensive apartments, electronics, and home furnishings. These things bring utility and comfort but will never grow in value. Viewing yourself as an asset, i.e. something that is sure to increase in value, is the first step. Continue to invest in yourself and other true assets will certainly bring you wealth in the Gig Economy.
James DeCicco is an American entrepreneur, speaker, and author in technology and finance. He is an expert on personal success psychology and business owner with several successful company exits to his credit. His latest book, “Master the Gig Economy” uncovers the mindset needed for creating an abundant life in today’s sharing economy world.