If you are an employee who wants to increase your wealth and become financially unbound from the low leverage, “time for money” dynamic, consider starting to see yourself as what you are: capital.
“Capital” is any thing that gives a person leverage, that is to say, magnifies their output, which increases the potential upside and downside. There are four main types of capital commonly found in our world: money, media, code, and labour. “Labour” is one of the most common forms of capital. You are labour. You are capital in the sense that you are strategically developed (from birth, through schooling and socialization) and then deployed by risk takers, for a return which is split with you. This is called “employment”. Employment is neither good nor bad. Jobs as a concept cannot be thought of as “good’ or “bad”. Instead, their value depends on your perspective, goals, and constraints.
Self aware capital
Specifically, you are a unit of self aware, autonomous capital. The self awareness part is important, as this is what separates you from the other forms of capital (code, media, money), and gives you a unique advantage. Most other forms of capital are deployed as their holder sees fit; a dollar has little choice where it is spent, or how much other dollars it brings with it when it comes back. Media is created and distributed according to the strategy of its owner. You, on the other hand, live in 3D, and have the ability to make any number of meaningful decisions. Since you are self aware capital, you are deployed, but simultaneously you are aware of your deployment. No other unit of capital can self analyze, choose not to be deployed, self sabotage, or even self determine their rate of return, based on willpower alone.
This sets the scene for an interesting economic game. What happens when capital becomes self aware? In other words, what happens when capital recognizes that it is capital?
Here are my thoughts about self aware capital.
Averaging and your autonomy
As capital, understand that many of your benefits come not from your power by yourself, but from your power when averaged with many others like you. As a result, your highest productivity will likely come from either being part of a situation where you average your efforts with many others, and share the rewards. It is especially rewarding if you pool your efforts with other industrious people. Most of us do this from 9 AM-5 PM. We combine our efforts with many other coworkers, in exchange for a guaranteed return on our labour. This guarantee is super important, as it allows you to have a few off days where you don’t perform at your best, as the rest of the organization can pick up the slack, at least over the short term.
Alternately, you can go off on your own if you feel that you can get a better rate of return when you are not encumbered by the restrictions that come with averaging yourself with so many others. This is self employment, etc. With this option you need to consistently perform at a higher level, because you won’t be able to average out your performance by combining your bad day with everyone else’s good day. There is less room for error, but higher reward.
You can choose to be part of a smart, small team working hard to solve a big problem for a big reward. Choose the rushing rapids, (as part of a major corporation) where no single drop of water stands out. Or you can be a small glass of water at the end of a summertime marathon. Or even a constant drip that eventually wears a hole through stone by repeated effort. Any of these three paths may suit you, depending on your personality and goals. Neither is better, they are simply different paths that self aware capital can take. Choose the best situation for you.
Also be aware that leaving the job is not your only option. For many reading this it is not even the best option. Another option is increasing your value by acquiring new skills. A dollar will always be a dollar, but the unit of capital that is “you” can increase your value when you develop a skill that is useful in the world. That’s like being born a dollar bill, but also having the ability to become a twenty dollar bill, if you so choose. How do you know if a skill is useful in the world? By whether it creates results that people want, as voted with their time and money. Another option for a self aware unit of capital is moving to a different location that provides more leverage or greater returns. This can mean moving jobs, or moving around the world. Alternately, consider investing part of your return in other forms of capital, or moving on from being capital, to being an allocator of capital.
Life after deployment
Finally, as a unit if self aware capital, spend time thinking about how you will finance your lifestyle if and when you are no longer able to competitively generate a return in the market, This happens when you age out of the workforce, or perhaps due to injury/ illness that dampens your earning power. You can fix the aging out problem by wisely using the returns on “you”, invested over the course of your life in evergreen asset classes. Consider insurance to help manage the risk of illness, especially if you are a high performer.
During your short working life, the other forms of capital (code, media, money) are still available for you to use. Prioritize using one or more of these forms of capital, while you are still working, to create a world where you gradually become more independent over the course of your working life. Create or acquire assets, buy some basic stocks, work on your personal brand, develop deep expertise in an area, etc. The point is to participate actively in life, and put the other forms of capital to good use, just as you are put to use by others. The main idea is your autonomy, not your status as capital. It is my hope that self aware units of capital everywhere will be more purposeful about how and where they are deployed.
Go where the return on “you” will be highest. Capital goes where capital grows. Consider unorthodox ways to multiply. Even if it not something you would’ve otherwise considered. Capital, for the most part, is agnostic about its destination. What matters is that it grows.