How to follow the money stream and be rich?

Show me the money

We live in a monetary system (i.e.: a system based on money). For better or worse, everything we do is influenced by the monetary system we live in.  What stores are around us, what advertising we see, what food we buy, what housing we can afford, what politicians are elected, how good schools are in our neighborhood..the list goes on.  It’s all about the money. 

So, to nav. the system we live in, it pays to always follow the money.

What does that mean?

The largest advertising market in the world is the U.S.  In 2015 alone,  statista.com reports that $180 billion was spent on adversiting in the U.S., and that is more than double the amount spent in the second largest advertising market, China.  What do you think that money was spent on? Trying to get you to buy things. One hundred and eight billion dollars were spent trying to get Americans to consume stuff. They did a great job, if you want a breakdown on how Americans spent their money, check out this article from 2012….$310 million on pet Halloween costumes. Just sayin’.  (Here’s another example for 2015)

What does that mean? We live in a system that spends A LOT of money trying to get us to spend our money.  On purchases, on things we may or may not need. It also finds ways to cut a pie in more ways than you can imagine in order to spread money around (see the home buying example below).  Bottomline: we live in a monetary system that is not inherently designed to think of your best interest, but designed to circulate money.

Here are examples of how you can follow the money in your daily activity: 

Small Purchases:

You need to purchase basic items to live.  Food, shelter, basic entertainment, all parts of having a balanced life.  If we are following the money, the primary question when buying something is: who’s making money off my purchase?  When you ask this question regarding small purchase, it’s more a question of ethics.  Am I about to give a company with whom I agree with their ethics my money?  The answer to that question might surprise you.

Big Purchases:

Large ticket items are even more important to understand.  These purchases often have a lot of different people involved in them.

Let’s take a home purchase.  How does everyone involved in this transaction make money?  Wait for it: the mortgage broker, the bank, the sellers’ real estate agent, your real estate agent, and the title company… ALL of the people involved in your home purchase, make a % commission/interest off of the amount you pay for your house.  Excuse me? That’s right, every single person in this transaction has a financial incentive for you to pay more for the house you purchase.

Does that put your purchase in perspective?  Does it make you want to pay attention more?  Does it make you want to find a really good, trustworthy agent that has your best interest in mind?  If it doesn’t, it should, because understanding the way this transaction works is imperative to saving you thousands of dollars in the long run.

This question can be asked about car sales, financial planners, your retirement funds and products sold to you like electronics and at banks. Know who’s making money off of you and you will know how to negotiate/navigate your purchase.

Your Job 

Another way to follow the money is when looking for a job.  We’ve said this before, but when looking for a job and industry, it pays to follow the money.  Where does your company’s revenue source come from?  What is happening with competitors?  Are the winds of political change in your favor?  What is the company’s leadership saying these days?  All this can teach you how to be a better employee, more strategic if you want to rise, and see the trends that are coming to your industry.

Our Political System

Another important place to follow the money is in the U.S. political arena.  It’s ridiculous, but in our world of barely-any-caps on campaign financing, it costs millions to billions for state and federal politicians to get elected.  They aren’t coughing this money up themselves, and don’t think they don’t owe big donors something once they are in office.  You can follow where their money comes from, then compare the policies they support and how they vote to see their true behavior.

The news you read

If only six media outlets control all our mainstream news in the U.S., then it’s not hard to know what money supports the news you read.  That’s because (once again) newspaper distribution is a business.  Since it’s a business and based on sales, all news outlets have target markets to which they cater.  That means their choice of articles, their perspective on a given topic, and their advertisements are designed to appeal to a certain demographic with certain ideals.

This is a dangerous reality because what is touted as independent journalism is potentially heavily biased.  We say this not to cause fear but to encourage you to use your own judgement, look at the article for bias, think what the other perspective might say about the same issue, and remember to use a critical eye when reading the news produced in the U.S…..because as they say: money talks.

The Nav.it 101

How to follow the money? In this U.S. economy and political system, in all aspects of your life, you will be smarter, more informed, and better able to navigate the system if you always think to: follow the money.