Cracking the Code: The Real Formula for Building Wealth

And we're always looking for how can we talk about building wealth in a manner that's fresh and gives you a different perspective. And so I was just brainstorming this week and I thought to myself and this is something I thought about before if you really want to build wealth, you need to start by building your income Years ago. And this is.

20 11, 20 12. I would talk to a lot of people about the concept of building your first million, and I would wrap it around the idea that you needed to get out of the middle class climb up because the middle class was being chipped away at. So a lot of what we see today is a result of years and years of different policies, different reasons that the middle class has been evaporating. And one of the drains on the middle class was not that people were falling out of it.

But that people were climbing out of it as well. So when I would bring up all these different reasons why you needed to leave, I would talk about having a million dollars just in case you lost your job. Now, for some crowds that resonated, but I always noticed that for my executives and just middle managers and whatnot. Certain people just always believed they would have a job. They made a certain amount of money.

It was a very comfortable salary, and they knew they could throw their hat out there in the pool and get picked up quickly. Fast forward to 2025 and we're finding that even I. The C-suite is under attack by the likes of AI automation and just a flattening, if you will, of the corporate management structure. So now we're starting to realize that everybody's at risk, right?

And so what I've told my wife and just anybody is that when they come to take your job, make sure you can reach back and hold onto something that you've built. And so this is where I thought about if you're going to build wealth. We can buy all these different things, but nothing's gonna happen if we just have one source of income or if the source of income we have is not enough.

And so when you think about it, everybody I've known that's done really well in a reasonable amount of time in life, they didn't so much make a great investment in the market. They increase their income and then invested more in the market, in real estate in different aspects to build wealth. So when we talk about if you want to build wealth, start by building your income, why? One higher income is gonna give you more ways to save and invest. Two, it creates financial flexibility.

You can handle the emergencies, you can invest in opportunities as they come. You can get rid of that 22%. Interest debt. You don't have to be burdened by those student loans as much. If your income is growing or if you have one more than one source of income, you can also accelerate compounding, right? You can use different ways to invest that, enhance the return by borrowing against your investments to buy more money or to buy more investments. Excuse me.

Let's talk about how do we get to this more income, because that's always gonna be the issue. Maurice, I hear you. I want to build more income, but what do I do? And invariably you'll hear about something called a side hustle. Now I'm always perplexed by why do we still call it a side hustle, in America, when somebody learns a second language, we don't call it a side language, we say you're bilingual. If more than two languages, you're multilingual. It's a badge of honor. It's aspirational.

But when it comes to income, it's a side hustle, and we have to watch our terminology when we're trying to do things. Because when you say it's a side hustle there's already a negative connotation with something that's on the side. That means it's not our main thrust. That means we don't throw enough attention at it. It's a hobby, it's a it's something that we do outside of our main thing, and our main thing is very precarious.

We're learning that our main thing, be it a STEM job for all my STEM crowd out there. I see you. If you are a lawyer, I see you, you've got the AI and the automation coming your way. The side, the main thing that we do is becoming increasingly precarious, right? So if this thing is on the side, it's not gonna get all of our attention. So I propose that we stop calling it a side hustle, and I even say, let's stop calling it a hustle. People don't turn hustles into something meaningful.

It has a a short term dynamic to it, right? Why is it so hard for us just to say, when you develop a second source of income that you are dual income or multiple streams of income? We don't think of I'm trying to think of a famous person. We don't think of Michael Jordan's sneaker sales as a side hustle. He's a sneaker empire. Other athletes, when they step outside of their main thrust we don't think of it as a side hustle. Why? Why?

Because in our minds, they've done so well in their main field. Now they're just expanding. You've done the same thing, right? You went to college, you've got the degrees, you have the 10, 15, 20 years of experience on your job. You're just expanding. You're expanding your income. You aren't creating a side hustle. You're creating a second stream of income that will then allow you to invest more in the markets and real estate reduce debt. Create legacy for your family, right?

It's not a side hustle, it's a second stream of income. So if you're gonna build wealth, you gotta build that income, right? And the first thing you gotta do is stop telling yourself, this is a side hustle. You know this. This isn't a side hustle. This is a second stream of income. One of the things about a second stream of income that I like as well is we can get away from some of the, the passion, right?

I feel when I first came outta college a long time ago if you wanted to start a business, everybody was trapped in the I need a business plan before I can get started. And so the market responded to that. Smart enterprise companies would sell. Business plan CDs that would help you write a business plan. But to this day, nobody really knows what a business plan is. And then you turn on shows like Shark Tank and they come up and they do everything but a business plan to get more investors.

So today I feel like we're in that same trap, but now it's. Hey, if I'm going to do something outside of what I went to school for, it has to be a passion. It has to be something that I love to do. I don't subscribe to that. And that's one of the big things about building another stream of income. You can just go for what works what are you interested in, what can you do, what can you delegate? You know what can you do out there? What need can you meet to create income for yourself?

If you knew how to cut hair on the weekends. If you know how to run do landscaping, hire people to do landscaping for you, right? It's all about what you know. What skill can you trade for money? What expertise can you lend someone in return for money? It doesn't have to be a passion. We go to college and I always wonder, I'm going to college and I'm learning English and math all over again. You learn all these different subjects in college. Go back over your college curriculum.

What did you learn outside of your major that you now can take and expand and do something with? Can you tutor, right? Can you teach people how to speak eloquently, right? Can you do coaching? What can you do? That can create extra streams of income and just again, step away from the side hustle, step away from the jail of I have to be passionate about this, what I do for a living investment management. Yes, I loved engineering. I was passionate about it.

I I started watching CNBC and Jim Cramer was running around there and. You know how Jim Kramer is running just yelling and whatnot. And that intrigued me. And then the market was crashing and I was an abot reader of the paper, and so I just got enveloped in it. But let's say I didn't, let's say I didn't have that dream scenario, that aha moment, let's just say market crash. I was a little bit interested and then I stayed with engineering, okay? Then at some point I hit a wall, right?

If I wasn't gonna go in the upper level management, you're going to hit a wall with your income and whatnot in corporate America, right? So what could I do? I went to college. I learned HVAC as part of engineering. I learned thermodynamics. I learned physics. I learned heat transfer. I learned circuits. Somewhere in there is something I could have done to supplement my income as an engineer. And all of us have that in our wheelhouse.

And if you ever want to know how you connect these dots, I encourage you to go listen to Steve Jobs Stanford commencement address where he talks about his path through college and really out of college 'cause he dropped out and all the different things he learned that impacted the final product that we call the Mac and even the iPhone and the iPod. IPad, excuse me, today.

So just to sum up, when you're stepping out for that second stream of income, and hopefully that third stream of income, don't get trapped by, it has to be a passion. Don't let that be your only guy if you're lucky enough to pursue your passion. God bless you. But don't let that utopian dream bar you from trading some of the skills you have, some of the soft and hard skills you have that you've picked up over a lifetime. Don't let it not being your passion block you from creating.

A second stream and hopefully a third stream of income. Now, as you start to build this income, it does no good. It does you no good if you have what they call lifestyle creep. And I'm guilty of this, right? As my income started to come up, I started saying yes to a lot more things, right? And I like to eat I like to eat. People know me. I struggle with keeping my weight under control.

And the only thing that really worked for me was I jumped in the intermittent fasting, and that allowed me to consistently keep the weight off. And I'm thankful for the concept, but I still will go to a restaurant if I go to a new restaurant. I'll order three or four different entrees. 'cause I want to figure out which one I like. So when I come back, I know exactly what to order. That's a waste of money I say yes to a lot of things for the kids.

That would not have been the case during my childhood. And it's all because my income is always going up by nature of what I do. I get lots of opportunities but don't trust me. I paid the price for those opportunities in my twenties and thirties and so they're here now and it's great, but it doesn't mean I should be. Undisciplined and I don't want you to do the same. So as you start to create this other stream of income, go ahead and open up.

If you're gonna be a full-time, you know straight up business owner, go ahead and open up your solo 401k. Open up your SEP IRA, open up your Roth IRA, open up a margin account, and I can talk about what all those are. But open up these places to put your. Money so that it doesn't work its way back up into the consumer driven economy. You don't want to be a bigger consumer because you have bigger income. You wanna be a bigger investor.

You want to be in position where that friend who's done well comes to you with an investment opportunity. You want to be able to say yes if the circle IPO comes your way, right? We have a couple of clients who are in that position. You want to be able to say yes. To the next Bitcoin, the next cryptocurrency. You want to be able to say yes to the next AI idea. You want to be able to say yes to the next real estate development, right?

And you can't do that if you are literally spending all of your new income, right? So the only way to keep the income that you have is to invest it. Do not save it. Savings are for emergencies. They're stagnant, right? You want to be an active investor. You want to be in the market. You want to be in some type of market where you're taking some risk with this new wealth. This new income to build wealth, right? And that will keep you from blowing your extra income.

Do not underestimate unless you are a unique person and what I call a super saver. Most of us like to spend money. We just do. Most of us like to spend money. It may not be obvious, it may not be on our wrists, on our person, but it may be a bigger house. Three cars more services coming to the house, landscaping, personal chef, things of that nature. Do not blow your money, get it into a market and get it for working for you. So let's just to recap, right?

If you want to build wealth, start by increasing your income. A lot of us are we're trained, right? We're trained K through 12 to go out and get one job, have one source of income, have one career. Worked at one job for 30, 40 years and then retire. So when we find that's not gonna be our path, very few people have that path. Then we start looking for ways to, to build wealth, right? Or build income. And so we fall into the trap of calling it a side hustle. Don't call it a side hustle.

You want to become dual income, multiple stream of income, something aspirational, something positive. And as you're building or looking for these income sources. Do not limit yourself to just what you're passionate about, right? Passion is for hobbies, right? Passion is for raising your kids. Passion is for charity.

When you're trying to increase your income, trade, the hard and soft skills that you have the hard skills are gonna be what you learn in college, what you learn in high school, what you learn in trade school. The soft skills are gonna be those things that you do. That you're just good at. You didn't necessarily get formal training for it, but you're good at it and you can offer it to the world, right? That's your soft skills, right? Take inventory of your skillset, right?

And then as you start to build this income and by proxy, start to build your wealth. Put this money into the market. Put it into real estate, put it in, into things that are going to grow the money do not fall victim to lifestyle creep. Don't start buying more stuff. The country is just riddled with stuff. We've got storage facilities going up all over the place, but we've got people dropping stuff off at Goodwill, leaving stuff on the side of the road.

We got so much stuff and then our parents are gonna give us all this stuff and we don't need all this stuff. What we need is to address the fact, hey, we're probably gonna live to 80, 90, 100. And we need to make sure our money is there to take care of us and when we can no longer take care of ourselves, and you're not gonna get there by buying more stuff. So make sure you put that money to work. So I challenge you over these next 30 days to take inventory of your skills.

If you already got two incomes, what can you do to create a third income? And this isn't hustle. This is just, Hey, if you're trying to build wealth, if you're listening to my podcast, we're trying to build wealth. So you're trying to in increase your income or deepen the income sources that you have going for yourself. And so this goes for you. Entrepreneurs like myself, don't just rely on that one business.

We found out this year that if you were an entrepreneur who happened to do a lot of federal bus business, guess what? Your business looks a little more precarious right now, right? If you're in the tourism business in the US your business looks a little more precarious if you use a lot of construction work. If you were, your business looks a lot, a little more precarious right now, and I guess precarious is my favorite word today, so forgive me.

But what I'm trying to just impart with you is even if you are a successful executive, a successful business owner. Don't let that one source of income dominate your wealth building. Go ahead and create something else. You're gonna thank yourself if and when you need it. Once again, my name is Maurice l Wilson. Thank you for listening to the Wealth Equation podcast. You can find us@ww.wilsonwealth.com. You can find us at the Wilson at the Wealth Equation Podcast on YouTube.

Feel free to drop by, join our newsletter. Hit the subscribe button, tell your friends, and I will be coming to you every Wednesday. With more videos like this and we'll also look into to eventually start posting on Sunday as well. Thank you and have a great evening. Intro & Outro: It is a pleasure to have you join us for this episode of The Wealth Equation. Be sure to visit wilson wealth.com for more information about building wealth.

We look forward to helping you next time on the Wealth Equation.