Many people often find themselves searching for the best ways to build wealth, hoping to come across some profitable stock market tips or solid retirement plans. However, we’re going to approach this topic a bit differently today. Instead of the usual advice, let’s explore how you can build wealth by making smart choices.

Being “smart” can mean many different things, but in this article, we’ll focus on a few key points: investing in a college education, the income differences between well-educated individuals and low-skilled workers, the job market’s supply and demand dynamics, and how reading books can make you smarter and lead to better investments.

Invest in College

One major way educated people tend to earn more money than low-skilled workers is through college education. Let’s break down the essentials you should consider.

College is undeniably expensive, with an average cost estimated at about $100,000. While you’re studying, you’re not working, meaning you’re missing out on potential income. But, let’s compare the average salaries:

– A high school diploma typically earns around $35,000 per year
– A college degree boosts that figure to approximately $68,000 annually

Now, let’s do some calculations. Over a lifetime, individuals with a high school diploma might earn around $1.4 million. In contrast, someone with a college degree could bring in about $2.72 million. Based on these figures, investing in a college education seems more than worth it, as college graduates earn almost double every month compared to their counterparts.

Invest in Books

Warren Buffet, a renowned businessman and author, often emphasizes the importance of investing in knowledge. He particularly praises “The Intelligent Investor” by Ben Graham, which he considers the best book ever written on investing. The wisdom here is clear: to improve yourself, you need to learn from those who have already mastered the skill.

Books are relatively inexpensive, often costing around $10-15 on platforms like Amazon. For this small price, you can access a wealth of knowledge about investing, economics, or politics, which can significantly enhance your ability to make smarter investments. Essentially, investing in knowledge truly pays off.

Supply and Demand in Jobs

Consider the job market: how many kindergarten teachers are there compared to chemical engineers? According to the law of supply and demand, if something is abundant, its price is low. Conversely, if something is scarce, its price is high.

This principle applies to employment as well. If you have a high level of education, you’re more likely to secure jobs in fields with less competition and thus, higher salaries.

To wrap up, this article aimed to illustrate that smart investments go beyond the stock market. By investing in education and knowledge, you put yourself on a path to greater financial success. Remember the adage: “The more you learn, the more you earn.”