You’ll Never Be a Millionaire with a Salary
Here's the quiet path to become a different type of millionaire
People get triggered when you say “millionaire.”
They wanna throw a kitchen sink at you. This post isn’t designed to upset you. The point: to discuss an important topic that’ll set the foundation of your financial future.
When I posted this headline on X, people lost their minds. Let me go deep so you understand what a real millionaire is and how you can quietly become one.
The big reason to become a millionaire
My critics said these things:
“I think there are many people with a net worth of over $1,000,000 on a salary.”
“Not true. Some of my best mates make multiple 7 figures per year in corporate roles.”
To make a million dollars in a job makes you an outlier.
You’re in the top 0.01%. This isn’t a viable strategy for life. Why? Because it’s the equivalent of winning the lottery. Perhaps you’ll get there but you have little control over the outcome.
If you make lottery decisions you get sh*tty lottery outcomes.
Even if you do win the corporate ladder lottery and make $1M+ a year, you’ll have zero time. You’ll sit in back-to-back meetings like a slave. And you’ll probably have to travel overseas a lot.
If you have money and no free time you’re bankrupt.As soon as you reach this million-dollar point climbing the corporate ladder to nowhere, layoffs can take away your golden egg.
Then you’re in your 40s or 50s and back into the workforce where you’ll face extreme age discrimination. Screw that.
“Get to C-suite, and maybe you might earn that much in your 50s.”
This critic is right. But becoming a millionaire later in life isn’t as good as right now. Why wait?
The type of true millionaire I’m talking about has the 7-figures AND free time. And they likely have multiple millions of dollars. That’s not the same as a corporate slave who got there by winning a corporate lottery.
“Fake news. Yes, you can, I know tons that did it through investing.”
That’s right Mr Critic. You can use a salary to become an investor.
But what these geniuses don’t tell you is the average salary worker who may make money by investing does so by the time they’re old and crusty.
A million at 65 isn’t the same as 25.
I retired from the workforce at 34. That feels 10x better than 65.
I get to see my daughter grow up. I could have retired at 26 if I didn’t screw up my 100-person startup opportunity and let my ego make me drink shots of tequila of strippers’ bodies to look cool.
No one talks about the risks either. I love investing in financial markets but I was a banker for over a decade. I lived and breathed that sh*t.
The typical person is terrible with investing. They FOMO into Dogecoin and buy Tesla stock because some TikTok influencer told them to. Then when we hit a recession they sell everything for a loss.
You may become a millionaire on paper by investing into stocks/bonds or real estate for the next 40 years, but by then the value of money, thanks to inflation and currency devaluation, will be different. $1M in 2064 is like $1000 now.
Congrats you won the game but still can’t buy a basic house & sip mojitos in Hawaii.
Salaried employees pretending to be Warren Buffet are a nightmare.
Critic: “Disagree! See the FI/RE movement and the simple path to wealth but also variations like Fat FI/RE or Coast FI/RE”
The problem with these light-your-ass-on-fire movements is you can’t enjoy life in the meantime. You have to live like a pleb on beans and rice for decades and be a tightarse at the bar when it’s your turn to buy drinks.
Or you gotta live on a rural property 400 miles away from the next human while rubbing together sticks to create a fire for warmth and sending your kids to some creepy bush tucker school in the middle of the woods next to where the Blair Witch movie was shot.
Screw that. Nah mate.
The path to millions definitely doesn’t look like this…
“You can be a millionaire with a salary. It just takes time, planning, and discipline.”
“You will be a millionaire if you persevere and have grit.”
These are not strategies. I f*cking hate platitudes.
If I can’t action the plan, it’s bullsh*t. It’s based on hope and luck which is the fastest way to go broke and accidentally become a slave to “the man.”
Being hard-working won’t make you wealthy. Having grit isn’t enough to find ways to help people and get paid a lot of cash for it. Persevering with the wrong plan won’t lead to money either.
The quiet path to become a millionaire
Starting out with a salary is fine, I’m not here to shame anyone. I started that way. But going beyond a salary should be your ultimate aim.
These are the core components to transition to a millionaire lifestyle.
1. Remove the ceiling on your income
The problem with a salary is your income is mostly fixed.
You get paid the same amount every year, or by the hour. When you want to earn more money your options are limited.
1) Beg for a promotion
2) Ask for a pay rise (no employer has an incentive to pay you more money for the same work. In fact, capitalism is all about making the maximum profit out of you, so it’s better to replace you).
The way to remove the ceiling is to add multiple streams of income. It’s to productize yourself and use the internet to unlock more money.
Some call it the Creator Economy but I hate that label. It makes people think they need to become some silly personal brand and shove a selfie stick up their butt. Yuck.
I just call it building a digital business. It’s the idea we’re all businesses, and a salary is just one income stream of a one-person business.
Action: build a tiny online empire around an interest that becomes an obsession.
2. Embrace owning a business (even if it makes you feel salesy & disgusting)
When you think like a business, you think like a millionaire.
When you think like an employee, you think with a scarcity mindset.
Until you flip the switch from employee thinking to business thinking, everything financially in life will be hard. That’s some Timmy Tough Love right there. Soz.
A business removes the cap on your income. It allows you to own your time and own the outcomes.
Action: start a digital business.
3. Avoid status-seeking Lambo behavior
These last few weeks have been extraordinary.
Thanks to the U.S. election now being over, my investment portfolio has pumped harder than Arnold Schwarzenegger on steroids in the movie “Pumping Iron.”
No matter how hard I resist, I find it easy for us humans to revert to buying useless stuff we don’t need to look good. I’ve done a bit of that.
The goal isn’t to buy nothing, which is a form of bragging. It’s to be aware of status-seeking behavior and remember this:
Every luxury purchase you make takes you one more step away from true freedom.When you get tempted to buy the Mercedes Benz, ask yourself “Will this take me closer or further away from freedom to do whatever I want without being told what to do, and to have maximum free time?”
That question is incredible for blowing up most buying decisions.
Action: Buy fewer things, to have more time.
4. Don't get absolutely crushed by taxes
The salary lovers never talk about this one.
Sure, you can get a C-Suite salary but you’ll likely pay at least 50% of it away in tax. When you operate under a business(LLC), you get pre-tax dollars into your bank account. That means you have way more control and can claim most expenses as tax deductions.
When I quit banking this was the biggest change. Initially, my salary at the bank versus my business owner salary was roughly the same amount.
Why?
Because I became so addicted to the crack of a salary that my mind needed to see the same income each year to make the transition.
After the first month I noticed that, even though the number was the same, I had way more money as a business owner. This was because of tax. I paid less.
I recently bought a Tesla. People slammed me for it.
What they don’t know is 70% of the cost was handed back to me in the form of tax deductions and refunds. So I got my dream car to safely drive my daughter around in for the price of a Hyundai Excel. I used pre-tax dollars.
Legally master tax… or become a slave to the government and 10x the time it takes to become a millionaire living off post-tax dollars.
Action: get your income to flow through a business.
5. Unlock this cheeky scientific formula from Naval Ravikant
The gurus love to get h0rny over the power of compounding.
I’m more of a fan of the power of leverage. A salary is stupid because you trade time for money. When you think like a millionaire you trade your time and money to buy more leverage.
Here’s the nerdy scientific framework:
"Give me a lever long enough and a fulcrum on which to place it, and I shall move the world." – Archimedes
According to legendary entrepreneur Naval Ravikant, there are 4 forms of leverage:
Labor - hire people to do some or all of the work.
Capital - use money to make more money through investing.
Content - unlock the magic of social media by posting content daily.
Code - use software and automation to save time (the essence of a digital business)
Make your goal to unlock leverage, not stack up huge piles of cash, and you’ll end up with millions of dollars and more free time than a beach bum at Bondi Beach.
The goal isn’t one form of leverage. It’s all four forms of leverage.
Action: implement Naval’s 4 forms of leverage.
Final Thought
If you refuse to accept a salary is bad long-term, you may become a millionaire on paper, but you’ll never experience freedom or what it’s like to have free time.
Once you accept a salary will never make you a true millionaire, only then do you have the foundation to unlock personal freedom.
Tell me which of these ideas you loved the most and why in the comments.
This article is for informational purposes only, it should not be considered financial, tax or legal advice. Consult a financial professional before making any major financial decisions.
I send this email weekly. If you would also like to receive it, join the 131,000+ other smart people who absolutely love it today.
👉 If you enjoy reading this post, feel free to share it with friends! Or feel free to click the ❤️ button on this post so more people can discover it on Substack 🙏
Tim, although I was doing 70+ hour weeks in my previous role (and I loved that), a looming layoff made me take a fresh look at generating income. We're no longer living in the Industrial Age, we're moving to the Digital Economy. Making money through the Internet is the way.
I'm currently re-reading Millionaire Fastlane by MJ DeMarco and I agree with you both! It's a fresh new perspective most the people don't see. I'm working on it as I want to have free time for seeing my kids grow up in a few years (don't have any yet).
Great article as always, Tim!