4 biggest myths on making more money

'Can we go somewhere less expensive?'

Saying those words in my early twenties hurt.

My girlfriend wanted to go to one of the best sushi spots in town to celebrate our anniversary. I was scared to cover the bill.

When will I have the freedom to choose restaurants without worrying about the cost?

Because the truth is that there are many things money can’t buy — a fit body, a healthy mind, and a house full of love.

Outside of those things, money helps us thrive, help others, and live our best lives.

Most of us want more money. But there are a lot of myths out there about making more of it.

I’ve fallen for them myself, and some took me too long to realise.

Here are the four biggest ones I’ve seen holding people back from hitting their financial goals.

Myth 1: Hard work alone will get you there.

It was embarrassing to have bleeding fingertips in high school.

I was 13 years old and gave up my weekend to work two six-hour shifts at the local café for $6 an hour.

The problem was I had a weird skin thing called ‘irritant contact dermatitis’.

Your fingertips peel off because of overexposure to soap and detergent, and if you don't keep your fingertips moisturised, the skin cracks, stings, and bleeds.

But getting my weekly paycheck of $72 was worth every layer.

Moving up

One day, my neighbour asked for help moving her office. $10 an hour!

Holy smokes! Does she know that I'm only worth $6 an hour?

I agreed and made a hundred bucks that weekend. Then, I started helping a local moving company since I had the "experience."

Working hard alone wasn’t enough - it was about the value of the problems I was solving.

I learned that people create varying amounts of work. Some problems pay more. Some pay less.

And as I've gotten older, I now know that no amount of money is worth sacrificing your health.

Naval best sums up this lesson: "What you work on, and who you work with, matters more than how hard you work."

What you choose to work on and who you choose to work with matters more than how hard you work - Andy Crebar

The problems you solve

Many people are willing to serve the tables, but to my neighbour, I was solving an urgent problem. It was a more valuable one to solve.

This was a big eye-opener for me because I thought that if I worked the hardest, I would get rich.

Not true. Working hard helped get me opportunities for sure, but it was focusing on the wrong things.

Finding these is difficult, but not impossible.

Unfortunately, many focus on owning a business instead, this is the second myth.

Myth 2: Owning a Business is the Only Path to Wealth

‘The Millionaire Fastlane' by MJ DeMarco has sold more than 1 million copies worldwide.

It offers a contrarian approach to achieving financial success that many want to hear.

But the principal idea in the book is dangerous without the right context.

Owning a business can make you wealthy, but it's not the only path.

The fast lane fallacy

My dad went out on his own in his late 30’s and was working late most weekdays.

He would say that the best part of being an entrepreneur is that you get to decide which 16 hours of the day you want to work.

Because the sad truth is that more often than not, you don’t own a business ... it owns you. Many business owners work 80–100 hours a week to survive (and hopefully succeed).

So much about the desire to be an entrepreneur is actually coded in our DNA. Research shows that genetics account for 40–50% of the urge to be an entrepreneur (Nicolaou & Shane, 2009).

It's a dangerous culture where we encourage everyone to be an entrepreneur. Some people are much happier and more successful working for others.

High-return opportunities

What is of great value, regardless of the direction you choose is the ability to compound your wealth with high-return opportunities. This can help you reach and maintain escape velocity.

As Benjamin Franklin said…

‘The money that money makes, makes more money.'

But $1,000 compounded at an annual rate of 10% for 20 years will grow to $6,728.

Inflation would have eaten into it. New commitments would have come up. In the grand scheme, $6,000 won't get you very far.

But a million dollars compounded at 10% each year for 20 years will grow to $6,727,500.

That's life-changing money. And it comes from compounding from a decent base.

So, how do you get that first million?

It’s not going to come from compounding the $1,000 you saved for 72 years at 10%.

Investing in yourself is the best use of your money. Improve your skills and earn that first million.

But it's harder to do when your earning power isn’t there.

Myth 3: Focus on making more money

How can you increase your salary from $100,000 to $200,000?

The bigger the problem is, the more value you create, and the more value you can capture as part of your involvement.

How much? Well, there is no rulebook, but usually 10–20% of the total value.

If you're paid $100,000, your value to the company might be around $1 million per year.

This shift from effort to knowing and growing your value can create much bigger financial rewards.

We need to focus on creating value, not making money. Growing the pie and taking a bigger slice is much more fun that trying to take share of other peoples.

$1,000 vs $50,000 - showing the power of value creation over value capture - Andy Crebar

But creating that value takes effort. It won't appear in your bank account. This leads me to the final myth.

Myth 4: You’ll Get Paid What’s Fair

If you’re average, you should expect an average salary.

But let’s be real - you’re above average.

I'd even bet you're in the 40% of the world’s population that brings a growth mindset to your life.

So how do you capture more of the value that the average?

Iron Man’s Contract

The Avengers movie franchise has generated over $30 billion at the box office so far.

Robert Downey Jr. has taken home almost $500 million of that. It's up to 100 times more than many of his fellow cast members.

Like Downey, you won’t get what’s fair because you deserve it—you have to negotiate. And effective negotiation is a skill that ensures you capture the value you create.

How does that happen?

The storyline, production, and box office revenue were the same for everyone involved.

Downey's agent negotiated a unique deal: a 'percentage of the film's profits.' This shows us that you don't get what's fair. You get what you negotiate.