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Consider achieving financial freedom by moving from point A, which is your present financial status, to point B. If you wanted to do something while you were still young, healthy, and full of energy, I’m sure you would want to move as quickly as you could.
Would you rather decide to walk there, as you want to get there as quickly as possible? Lacking a map? To ride on a slow tractor to get there? Alternatively, do you want to go at a top speed of 372 km/h in a Formula One car?
But in reality, the majority of individuals don’t behave in this way.
Most individuals choose the sidewalk or the slowlane rather than the fastlane.
We will discover ways to accomplish our financial objectives in this summary much more quickly. The Millionaire Fastlane’s top five takeaways are summarized here.
The author of the book, MJ DeMarco, had a truly spectacular fast-lane excursion.
He went from a miserable 26-year-old living in his mother’s basement to a millionaire at age 31 once he made the Fastlane route choice.
About MJ DeMarco
Entrepreneur, investor, counselor, and internationally best-selling author MJ DeMarco is currently semi-retired. His works have been translated into more than 15 different languages. He is the current founder of Viperion Publishing Corp., a media company that specializes in the distribution of print and internet material. He is also the founder and administrator of The Fastlane Forum, the premier online community for debates on startups, finances, and entrepreneurial businesses.
He was the former start-up Founder/CEO of Limos.com (1997–2007), a global ground transportation aggregator and marketplace that he successfully built and grew into a profitable multi-million dollar company, all with no money, no formal training, and just a few employees before venturing into the world of writing and authorship. He sold the business in 2001, but eventually bought it back through a bankruptcy reorganization. Later, in 2007, he sold the business once more to a private equity firm based in Phoenix.
MJ was able to retire in his thirties without giving up the nice life by refusing to follow society’s script for mediocrity (THE SCRIPT: jobs, 401(k)s, frugality, give your life savings to Wall-Street). That does indeed imply that he is not engaging in Wall Street’s “hope, wait, and pray” game, in which you anxiously put all of your assets in the stock market while lamenting the Starbucks you were unable to enjoy because saving $4.12 was more crucial. (Do people actually think that nonsense?)
Currently, MJ runs a publishing company that creates, sells, and licenses his work globally. He also regularly participates in TheFastlaneForum.com, a business forum with over 40,000 entrepreneurs. He enjoys road trips, softball, traveling, health and nutrition, working out, and idly exploring the Sonoran Desert on his UTV. He resides in Scottsdale, Arizona.
Takeaway #1: The Sidewalker, the Slowlaner, and the Fastlaner
In order to understand what the sidewalk, the slowlane, and the fastlane represent, we will have a look at three stereotypical characters from each group. We have:
- Sidewalk William
- Slowlane Steven, and
- Fastlane Frank
Now, here is what they might say about a few topics. I encourage you to do an honest evaluation and think about which beliefs that you identify with the most.
- Whatever pays best today, I’ll take it!
- My only source of income is my Fortune 500 employer
- Business systems and investments
- Spend it! Carpe Diem!
- Money is scarce a dollar saved is more than a dollar earned live below you means
- Money is everywhere and it’s abundant. Money is simply a reflection of how much value I’ve been able to create and deliver to my fellow man. Live below your means, but with the intent to expand those means
- Time is abundant, but I don’t feel like doing today. I can always do tomorrow.
- I am happy to trade my time for money and I’m happy to trade many years of my life at college to get a higher salary
- Time is my most valuable asset by far. I must detach my income from my time spent
Destination and goals:
- I’m going to retire financially secure at age 65
- My goal is to create a lifelong passive income through businesses or investments
- Live today! No regrets!
- I’ve given up on big dreams. I’m a realist, you know, but if I live frugally and don’t take any unnecessary risks. I will retire with a million one day
- I will pursue my dreams no matter how crazy they may sound
I know that I’ll need time and money to make them a reality. So let’s get this going!
Do you recognize yourself in the beliefs of Fastlane Frank? Please comment “Fastlaner!” down below.
Our beliefs form our actions. If you identify yourself with many of the slowlane, or perhaps even the sidewalk beliefs, it’s very probable that you are currently not on a highway towards wealth.
Let’s see why and let’s see how you can change that.
Takeaway #2: The Mathematics of Poverty and Mediocrity
Depending on which road you choose, you are predisposed to end up at a certain financial destination. And, as you probably already have guessed the sidewalk is predisposed towards poverty, the slowlane towards mediocrity, and the fastlane towards wealth.
Let’s have a look at the wealth equation of each of these to see why that is so.
The sidewalker believes that wealth is created like this:
Wealth = Income + Debt
Yes, the sidewalker actually believes that debt can be used as a tool for wealth building, and that’s because he’s got the wrong perception about wealth. He believes, like the majority of our society, that looking wealthy means that you must be wealthy. As his credit card can allow him to buy that new Armani suit, it must mean that it makes him wealthier, right?
Unfortunately, the sidewalk doesn’t care about how much money you make, because poor money management cannot be solved with more money.
Onwards to the slowlaner’s wealth equation, which looks like this:
Wealth = Job + Market Investments
Let’s break these two down:
Depending on how you are paid, the wealth that stems from your job can look like this:
A: Job = Hourly Wage + Hours Worked
Or, like this:
B: Job = Yearly Salary
The problem with both of these is that they are bound by time.
For A, you can only increase your wealth by switching into a job that pays a higher hourly wage or by working more hours.; Work 12 hours a day instead of 8 and you’ll earn 50% more, but you’ll also burn out in the process, guaranteed.
For B, You will have to go to college to get a higher annual salary, or to climb the corporate ladder, both of which takes a lot of time.
Ever seen a 20-something non-startup CEO?
The market investment equation is not linear like the job equation is:
Market Investments = Invested Sum * ( 1+ Yield ) ^ Time
We’ve heard it before, and Albert Einstein calls it the eighth wonder of the world: Compound Interest
However, it is bounded by time too, because the equation only starts to work drastically in our favor once we have big numbers.
Fastlaners love compound interest too, however, their goal is to skip the first 20 years and start where the real fun begins.
Let’s see how.
Takeaway # 3: The Mathematics of Wealth
It’s simple as this: to escape the slowlane you must dump your job and start a business.
If you want to learn how to get rich as an entrepreneur in a low-risk way, you may want to check out our summary of The Lean Startup by Eric Ries, after this.
Now, let’s look at the fastlane wealth equation
Wealth = Profit + Asset Value
We can break down the profit that you make in your business into two parameters: Units sold and profit per unit
Here’s where the power of the Fastlane shows: Both of these variables are possible to leverage
You can sell something that gives $10 in profits, or you can sell something that gives $10,000 in profit. You can sell a hundred units, but you may as well be able to sell a hundred thousand.
Let’s go back to the slowlaner’s wealth equation for a second. Do you think that you can ever become rich earning $12 per hour and working 40 hours per week? NO. That’s because small numbers have a strong gravity towards mediocrity.
Can you get rich by profiting $10 per unit and selling a hundred thousand of those units? You most certainly can, and really fast too.
Asset value will help you reach your financial goals even faster. If you own a good business system, people are typically willing to buy it from you, and they will typically pay way more than one year
If you liked this summary, and you can already feel that fire, have a look at our summary of The Lean Startup by Eric Ries. There, we’ll explain how to start your own Fastlane business, using your time as efficiently as possible and without risking your neck doing it.
Credit: The Swedish Investor
Quotes from The Millionaire Fastlane
“Somebody should tell us, right at the start of our lives, that we are dying. Then we might live life to the limit, every minute of every day. Do it! I say. Whatever you want to do, do it now. There are only so many tomorrows. ~ Michael Landon”― M.J. DeMarco
“Time isn’t a commodity, something you pass around like a cake. Time is the substance of life. When anyone asks you to give your time, they’re really asking for a chunk of your life. ~ Antoinette Bosco”― M.J. DeMarco
“There’s a profound difference between interest and commitment. Interest reads a book; commitment applies the book 50 times.”― M.J. DeMarco
“I’m a great believer in luck, and I find the harder I work, the more I have of it. ~ Thomas Jefferson”― M.J. DeMarco
“All events of wealth are precluded by process, a backstory of trial, risk, hard work, and sacrifice. If you try to skip process, you’ll never experience events.”― M.J. DeMarco
“Instead of digging for gold, sell shovels. Instead of taking a class, offer a class. Instead of borrowing money, lend it. Instead of taking a job, hire for jobs. Instead of taking a mortgage, hold a mortgage. Break free from consumption, switch sides, and reorient to the world as producer.”― M.J. DeMarco
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