Earning money doesn’t come easy. Today, I am going to share with you a very powerful idea which has changed many lives. The idea of creating wealth without putting many efforts. This sounds interesting, isn’t it? I have come across a lot of techniques that people followed and succeeded in creating wealth. We call it the 7R theory of wealth creation.
Prior to the Industrial Revolution, we had only two kinds of income called as Rate and Remuneration. Rate is offering goods or services at available price. Remuneration is offered to those who offered services. For example, a doctor or a lawyer get remediation for their services.But something interesting happened with the arrival of industry revolution. It’s called Replication. Efforts that were earlier put in by men now got transferred to machines. Earlier, if we had to make 100 copies of paper, we had to write it a 100 times. Then came the photocopier machines which had the potential to copy the sheet a 100 times or more in a minute.Today, we have other four kind of incomes i.e. Rent, Rights, Royalty and Returns.If you use these 7R’s wisely in your life you will be able to generate wealth by putting minimum efforts.You just have to create system & then system works for you.
Let’s start with Rent first. Rent is a wonderful way to generate income. If you have a spare property, flat, equipment or a spare asset, you can rent it and this will then initiate a cycle of income. If I have a spare property and put it on rent, it will start generating income for me even in my absence. Every month I will get a rental income without putting in much efforts. Property is one of the best ways to create wealth because of the great appreciation rate it has over the years. Next is Royalty. Many of you might have played Candy Crush. You will be surprised to know the earnings.It is about 500 to 1000 dollar per day.Every, time when you download the game, a certain portion of money goes to the stakeholders of candy crush.If anybody downloads an app,certain portion of the profit goes as royalty to the company. Apple has a revenue stream which is more than the GDP of 150 countries. Nowadays, people are also earning by putting up videos on YouTube, writing blogs, creating applications etc. People, are using intellectual property to create wealth. Moving on to Rights, it includes Franchise rights, Brand rights & Licensing. For example, McDonalds started with just 10 outlets in America and over the period of time they succeeded in spreading their franchise all over the world.Today, there are more than 36000 McDonald’s outlets in the world. Every day, when you buy burger or French Fries, certain percentage of money goes to the parent company.To all the budding entrepreneurs,”Interest is the eighth wonder of the world, return improves everything” as rightly said by Warren Buffet. Robert Kiyosaki quotes, “Poor people work, rich people network”. Through this network the power of earning money increases.
Khushbu Singh
MBA-FP (2018-20)