Continuing with the theme of trading time for money, here is an excellent article from Entrepreneur.com on how to make the transition in your life away from a wage structure. The full article can be found here.
Your income is limited by time.
When you’re trading time for money, your income will always be limited. The first reason: There are only 24 hours in a day to devote to the pursuit of money. And most of us need eight hours to sleep, two hours to commute to and from work and two to four hours, total, to cook, eat, tend to hygiene, relax and spend time with friends and family.
That leaves us with 10 to 12 hours to trade in for income. That’s it. But the reality is that no matter how much your time is worth to your organization: $20, $30, $50 per hour, there will always be a cap imposed here: time.
Another consideration in the pursuit of money is that few of us can just ask for more simply because we want it. We have to wait years before obtaining the necessary job promotion, and there’s a fair chance that we may not get that promotion at all.
The second reason for limits on income is that the more more we make, the more we’ll lose. Employee tax is the most heavily taxed income there is, and the more income we earn, the more tax we face. Which means that when someone goes from making $60,000 to $100,000 due to a promotion, they’re not actually making $40,000 more.
Your impact is limited.
When we’re continuously trading time for money throughout our lives, time is limited for pursuing the things we’re passionate about. This could be a hobby we love, giving back to the community or building something that could have a real impact in the world.
Simply put, with limited time comes limited impact.
The question is, then, how do we stop trading time for money? Consider getting yourself onto the one sustainable pathway to stop trading time for money. Follow these seven steps:
1. Change Your Mindset
The first thing we must do is change our beliefs. When we drop the mindset that says that in order to make money, we have to trade our time for it, our minds open up to the possibilities. There’s no rule that says that to make X dollars, we have to work X hours. In fact, it’s more important to spend time “un-learning” the old than “learning” the new.
So, think about trading value for money, not time. Think about what value you can create for other people, and how you can deliver that value. What assets, skills, knowledge, connections or ideas do you have that people value? Recognize your strengths and competency, then go all-in.
Related: Forget Time Management. Do This Instead and Be More Productive.
2. Build your expertise and authority.
Once we understand the strengths and value we can bring to others, we next need to build expertise around it. Developing expertise translates into larger value creation for ourselves and others, because we can now solve problems that few others can solve.
However, being recognized as an expert takes time and work, which is why building authority is just as important.
Building authority around your expertise is what will help people discover your expertise in the first place. You could be the best in the world at something, but if no one has heard about you, then it doesn’t matter.
Authority has many factors to it, but the most effective are testimonials, press & media, influencer associations and case studies. Give people the confidence to realize that you know what you’re talking about. Developing expertise & authority will immediately increase the value of your time and allow opportunities to come to you.
3. “10x the value of your time.”
Not all of us can leap into entrepreneurship in the blink of an eye. This is why if you’re freelancing or providing professional services for your time, multiply your time times 10: “10x the value of your time.”
Instead of working with 10 clients that are going to pay you $2 per hour, find two that will pay you $20 — then drop the rest. This is easier said than done, of course, but the logic here is to stay focused on the few that deliver the most results.
That way, you’ll be working fewer hours for the same, if not more income.
Which gives you more time to…
4. Focus on creating a product.
To stop trading time for money, create an offer that you can sell and deliver without having to be there.
A powerful way to do this is to create an online product — an ebook, training program, membership program, software apps, etc. You can also sell physical products online, but you’ll have to find someone who can manufacture and deliver the product to your customers (through drop shipping).
The reason why an online product can be powerful is that you can create it once, then focus the rest of your time on selling it. Yes, you’ll have to improve and optimize the product, but those tasks will happen on your own time.
This means you could go on vacation, spend time with friends or sleep and still have the ability to benefit as customers purchase your offerings.
5. Automate everything.
Figure out a way to automate and systemize everything you can in your business. This could range from how you acquire customers, to how you deliver your products, to how you drive traffic — multiple aspects of your business, whether that means your content calendar, automated email series, webinars, social media posts, facebook ads, etc.
The more you can systemize, the more time you’ll have to focus on the business, not in the business. Your time should be spent on long-term strategy, building relationships and growing the business — the drivers that will make your business thrive.
Now of course we can’t automate and systemize everything in the business. So what do we do?
6. Hire someone.
Eventually, it just makes sense to hire someone to help you in certain areas of the business. How do we know which areas are appropriate? To find out, create your 3 Lists to Freedom.
This list, designed by Chris Ducker, will change the way you look at your time. Here’s how it works.
First, create three columns with the titles:
1. HATE doing
2. SHOULDN’T do
3. CAN’T do
Get your employee (or assistant, intern, etc.) to start with the tasks you hate doing. Getting past what you hate doing will not only help you appreciate the value of outsourcing tasks, it will maximize the strengths you already have and help you to avoid focusing on your weaknesses.
7. Build your next offering
You’ve built authority, you’ve built your product and you’ve figured out a way to automate and hire someone to grow your business. What’s next?
Often, it’s not enough to have one offering out there in the market. The biggest businesses expand into different products/services, or they find a way to upsell their current customers.
Is there a product idea that your customers have been nagging you about? A set of features that you can add to provide a premium pricing package? Understand what your current customers are looking for and figure out a way to deliver it using the systems and resources you already have in place.
Now: Reward yourself
The final step is to reward yourself. What’s the point of having more time if we’re not able to enjoy it?