How to Make Money from Money

What is the best way to make money from money? There is that old adage, "It takes money to make money," and to all appearances that is very often true.

Let us say that money is conceived as tied up in capital investment and social values such as building walls, transportation, education and on-the-job training, inventory, research and development, time spent networking, civic infrastructure, work ethic, optimism, health, and so on as well as currency and liquid asset. How does one make money in the absence of these things? Or more narrowly, how does one make money without currency and material things?

No can do.

So again, what is the best way to make money from money? Various principles come to mind.

1) Find out what other people will buy. Someone has suggested that the customer is the best marketing expert. The temptation, of course, is to get this backwards. I buy what I like. I invest in what I like. I go all romantic on the business opportunity, the "can't lose" investment, the golden product... and only afterwards do I think about what other people like. And what they will buy.

Even when we are aware of the principle, getting it backwards is easy to do. And you may indeed like what others like. But you get the idea. "The fool and his money are soon parted," but the wise find out what people will buy before they find a way to give it to them. Bet on the horse running downhill, not the one puffing uphill.

2) Look before you leap. Do your research. Test small before going all the way. Yeah, this is like the first point, but broader. We may not have a crystal ball, but we can look at history. Company reputation. Demograpghics. Trends. Traps. Financial fundamentals.

If you want to make money from money, it does not have to be a glamorous process. It just has to work. And you have to make it work. Research first.

3) Of course if you have money, you can pay someone to do such research for you, to find the markets and the opportunities. But at some point you need to sail familiar waters, even if it is knowing who and what to trust. Would you rather make money in an area you know or fly blind?

A lot of faces can look beautiful at a distance. Up close, you see the pimples and wrinkles. Don't marry an opportunity at a distance. Prefer the business you know.

4) Invest in what you enjoy. I know. This sounds like a contradiction to the above. Hang on.
A dog-demon gives cartoon character Dilbert a choice: (1) Work for a charity and do all kinds of good, but live in poverty or (2) Make all kinds of money, but see your labors burned to ashes at the end of each day.

A lot of us don't like our work. We tolerate it in order to make more money than doing something we like. And there is something to be said for disciplining our hedonism and narcissism.

But we tend to last longer, be healthier, and succeed more fully when we find at least some enjoyment in what we do to make money. Invest in what you are good at. You are often good at what you enjoy.

5) When making money from money, do not focus on making money. There is nothing wrong with profit per se. We all need it to survive. And the best way to make money from money is to work at it. Even passive income is the result of years of some kind of labor for somebody.
But what I mean is that we are on this earth to do good for others. To love our neighbor as ourself, to do for others what we would have them do for us. Focus on the value you bring to the table, the thing you do for others, directly or indirectly.

The best way to make money from money is to use money for the benefit of people.
Next, to create a profit system online, sign up for the email series. The author has been working his own business full time online since October 2008.

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