An Argument in Favor of College… or Not

Many of my Libertarian colleagues, who are among my smartest friends, don’t believe in going to college. A recent essay by James Altucher on his blog – titled “Seven Reasons Not to Go to College (and a Solution)” – is an example.

I’ve always argued in favor of college. And my argument went something like this: Most kids can only learn so much in high school because their hormones are raging 23 hours a day. And also, let’s face it, most of us are idiots at that age. Still, if you apply yourself and have good teachers, you can get a very solid base. If you have that, and you continue to have the drive to learn, it’s quite possible that you can develop expertise in certain specific skills (even law, if you live in California). Then you can get a great job or start a business and make great money and all of that.

But that’s very different from being well educated. Well educated means – in my book – that you have a superior level of competence in life’s three essential skills: thinking, writing, and speaking.

The first of those skills – thinking – is a sine qua non as far as being well educated is concerned. But learning how to think well isn’t something you are likely to do in high school. Unless, that is, you are brilliant and go to a school populated with brilliant teachers and students. (I suspect this was true for my friends who are anti-college.) For the rest of us, high school is an emotionally and sometimes physically challenged gauntlet of horrible situations and even more horrible people acting at their worst. There is a nearly zero chance to be able to learn how to think at a high degree of competence in such an environment.

The same can be said for the slightly less difficult skills of speaking and writing – which are essentially two versions of one skill: rhetoric.

But you can, if you apply yourself, learn to think and articulate your thoughts in college. In college you have – or can have, if you want – the freedom and privacy to do so… and plenty of smart and thoughtful people around to help you.

Having said that, I would admit that 90% of those that go to college don’t learn these skills. They waste their time doing the sort of idiotic things they did in high school. And perhaps that’s okay, because they are probably going to spend the rest of their lives being thoughtless and rhetorically impaired.

So… for the 10% that go to college to learn, it is worth every penny they pay and every hour they spend.

That was and still is, to some degree, my argument.

But I’m starting to change my mind.

The first reason (and James makes this point in his essay) is that if you are in college to learn anything technical or anything business related (anything except liberal arts), you are wasting your time. Because anything you learn will be outdated or simply useless when you get into the “real world.” You’ll get a job and you’ll have to learn on the job.

The second reason is that if you do go to college to learn how to think and articulate your thoughts, you are going to be in liberal arts. But liberal arts programs these days are factories for idiotic group-think ideas like Socialism and identity politics. It’s actually impossible to learn those subjects and learn to think at the same time because the two activities are antithetical.

And there’s a third reason (and James mentions this, too). College is absurdly expensive. Way more expensive than it should be.

I’m not in favor of Bernie’s and AOC’s solution – free college – because this would do absolutely no good. The 90% of the college population would learn less not more if they went for free. (You don’t value what you don’t pay for.) As for the 10% that can’t afford it… I’d be in favor of giving them whatever financial aid they can’t get. (Most of those with financial aid do pretty well.)

But here’s the thing…

I think the current state of college education is on its way out. Young people today are more than equipped to learn online. Not just to access information and listen to lectures, but to interact with professors and coevals in all sorts of ways. And they can do that without leaving home. They can do it at their own pace. And at a fraction of the current costs.

I believe that in the next 10 years, there will be all sorts of online universities that will offer a perfectly good college education (good enough for the 90% at least) for a fifth of what kids are paying now. There will also emerge all sorts of online programs to teach kids specific skills and technical knowledge much more efficiently. They will provide certificates rather than diplomas, but that will be good enough for most careers that they might want to pursue.

Continue Reading

How to Get Rich as an Employee

It’s too often said – and I’ve been guilty of contributing to this myth – that the only realistic way to become wealthy is to go into business for yourself.

While it’s true that reaching billionaire status is almost always the result of owning large blocks of stock in a business you own and run, you can certainly become a millionaire and even a multimillionaire as an employee. I know that to be true from personal experience.

Even an ordinary employee can become wealthy simply by earning a decent income and saving a good portion of it.

Consider this: If you can save $10,000 a year over an average career length of 40 years and invest it in a stock portfolio earning an unexemplary 9% ROI, you will retire with a net worth of $3.3 million.

Does $10,000 a year sound like too much? Does $6,000 a year – $500 a month – sound more doable?

That will give you a retirement nest egg of $2.2 million. Not bad, right?

And there are ways to do much better than that, which  I’ll get to in a minute.

Here’s the thing: The secret to getting rich as an employee is to save as aggressively as you can while you nudge up your yearly compensation.

There are 4 simple ways to gradually increase your income:

  1. Shine immediately. Show your supervisor, from day one, that you are smart, ambitious, loyal, and talented. Make it clear to him that you are going to work your ass off to help him accomplish his goals.
  2. Be the guy everyone wants to work with. Make your fellow employees – as well as the big bosses – feel like you are someone that can get the right things done… in the right way… with a positive attitude.
  3. Embrace the dawn. Never be late. As Jeffrey J. Fox observed, “Arriving to work late signals you don’t like your job very much. Even if you prefer to come in late and stay late, staying late sends the signal that you can’t keep up or your personal life is poor.”
  4. Understand the most important facts about business. The lifeblood of business is profit. And the long-term success of any business depends on creating continuous value for its customers.

Do these four things and you will become known as (because it will be true) an exceptional employee. Your superiors will trust you to show up and do good work, all the while aiming to make their jobs easier and the company’s profits higher. You will be given regular opportunities to take on more challenging work. Accept those challenges and you’ll have no problem earning enough to save $6,000 to $10,000 a year.

If your idea of “rich” is more than several million dollars, you can do that too as an employee. You merely have to upgrade your reputation from exceptional to invaluable.

What is an invaluable employee?

To a business, an invaluable employee is one that can make a critical contribution to the bottom line. All businesses need various skills and talents. But they mostly need, and mostly value, those that stimulate sales, increase customer retention, boost customer spending, and bring in a bigger profit. That includes:

* the profit makers – the CEOs, division heads, and profit center managers

* those that I call the inventors – employees that are responsible for developing successful new products and services

* those that generate revenue – i.e., employees with the marketing and selling jobs conduct your own investigation into your company’s sales and marketing programs. Talk to those who already have the kind of job you want. Ask questions. Show interest. Be thankful.

Volunteer to help them in your spare time. Be frank about your motivation: You don’t want to take their jobs, but you do want to learn how to do what they do so you can become more valuable to the business.

While you are doing that, make sure you get noticed by the higher-ups in the company. Don’t boast about what you’re doing… but don’t be shy either.

Eventually, you will surely be offered the job you want. And when that happens, grab it.

One final thing: When it comes time to negotiate your compensation as an invaluable employee, fight modestly for an increase in your base pay and assertively for incentive bonuses based on your performance.

As you rise to more senior levels, you may even have the opportunity to take home a share of the profits you are generating. When that happens, you may one day find yourself saving not $20,000 or $30,000 or even $40,000 a year. You may get to the point where you are able to save six figures.

And when that happens, you’ll have the startling revelation that you can retire early… if you want to. But you won’t.

Continue Reading

A Good Example of  Bad “Science”

I recently read about a study, carried out by researchers at Yale and Oxford and published in The Lancet, that discovered that “exercise is more important to your mental health than economic status.”

It took me a moment to comprehend that. Is it a question that people are asking? Is it a question that can provide useful answers? Is it a question that you can even study in a scientific way?

As it turns out, the study was based on an electronic survey. The researchers asked 1.2 million Americans: “How many times have you felt mentally unwell in the past 30 days, for example, due to stress, depression, or emotional problems?”

The participants were also asked about their income and physical activities.

The results?

Those that exercised regularly felt bad, on average, 35 days a year. Non-active participants felt bad 53 days a year.

But also: Physically active people felt just as good as inactive people who earn around $25,000 more a year.

There are many problems here.

First, surveys about behavior and feelings are virtually worthless because people aren’t honest in answering such questions.

Second, even if they try to be honest, they cannot accurately remember their behavior and feelings over long stretches of time.

Third, in concluding that exercise creates happiness, The Lancet(which is becoming famous for publishing bad science) is conflating correlation with causality. This is probably the most common error made in understanding studies.

Let’s look at that study again…

It found that people that exercised regularly reported that they felt happy on more days than sedentary people. But that doesn’t mean – at all – that exercise is the cause of that additional perception of happiness.

You can use the same data to come to the opposite conclusion: that happier people are more likely to exercise – i.e., that feeling happy causes exercise.

There are actually dozens if not hundreds of variables that affect happiness. Exercise is just one of them. And since this study was not controlled (did not consider all the other variables, since doing so would have been impossible), what you have here is correlation, not causation.

With a correlation, you can come to whatever conclusion you want. And I believe that the researchers in this case wanted to come to a positive conclusion about exercise.

But it’s much more likely that the study proved what is common sense: that mentally healthy and happy people tend to take better care of themselves in every way.

You can also come to the opposite conclusion regarding income. That for the same cohort of people (those that don’t exercise), making more money does indeed make you happier.

Continue Reading

Principles of Wealth #28*

Every asset class has its own inherent ROI (return on investment) range.History suggests, for example,that it is 8% to 10% for stocks, 5% to 7% for corporate bond, 3% to 4% for municipal bonds, and 5% to 8% for rental real estate. The prudent wealth builder designs his investment strategy accordingly. Rather than trying to beat intrinsic ROIs, he accepts them and, if these do not suffice, finds alternative ways to achieve his goals.

The big mistake most wealth seekers make in regards to return is to try to “beat the market” – i.e., to strive for higher-than-average returns.

This is done for two reasons: ego satisfaction and ignorance. Getting higher ROIs than everyone else is a psychological trophy for those that believe it can be done. And the mainstream financial community does everything it can to encourage investors to believe they can. They themselves are motivated by ego (they have the secrets) and by greed (they make more money when investors pay them for advice on how to do it).

Case in point: Years ago, I made a speech to a room full of affluent investors about an opportunity to make 12% to 25% on a leveraged real estate deal. As early investors, this range of returns was possible.

A large, bald-headed man in the back stood up and interrupted me.

He said he wouldn’t think of investing in my idea. “Unless you can give me a 10-to-1 return, I’m not interested in what you have to say,” he announced.

A few people applauded him.

The coveted “10-bagger.” What investor hasn’t dreamed of that?

The thing is, none of the successful, long-term investors I know advocate or follow this strategy. More importantly, most of the tens of thousands of investors that do chase huge returns live to regret it.

The average stock market return over 100 years is 8% to 10%, depending on how you crunch the numbers. If you accept that and invest conservatively, you can expect to earn that much, over the long run, from stocks. But investors that try to beat at 8% to 10% fail to reach that goal. Countless studies indicate that they get returns of about 3%.

The dream of getting 1000% returns are touted by two groups of people: investment professionals that achieve those numbers very occasionally but make their big money by selling the dream, and inexperienced investors like the man who interrupted me.

Like my bald-headed critic, you may think that 8% to 10% returns are boring. If you do, I can only say this: You are wrong. And this idea will eventually make you poorer than you are today.

But there is a more important reason to accept intrinsic ROIs. It forces you to accept reality. When you calculate the future growth of your investments realistically, you may discover that your current portfolio of stocks and bonds will not get you to where you want to be. Realizing this, you must make a decision: Accept and adjust to a future of lesser wealth or search out other activities – which almost always require more time and effort than stock and bond investments – where you can earn higher intrinsic ROIs.

The intrinsic ROI for real estate in the USA is about 4%. But if you invest in income-producing real estate by buying rental properties at discount prices, you can expect to earn 6% to 8% a year. And if you leverage those investments with mortgages, you can expect to earn 8% to 12%. And if you take it one step further by improving those properties and raising rents accordingly, the intrinsic ROI will be in the 12% to 16% range – sometimes even higher.

Yes, rental income requires more time and work. But if you are willing to take that extra time and do that extra work, you won’t have to abandon your goal of achieving greater wealth in the future.

* In this series of essays, I’m trying to make a book about wealth building that is based on the discoveries and observations I’ve made over the years: What wealth is, what it’s not, how it can be acquired, and how it is usually lost.

Continue Reading

The Retirement Trap!

I should have said something…

He began, 25 years ago, as an accounting executive with a German partner of ours. Bright and ambitious, he rose quickly through the ranks to head of marketing, head of operations, and then COO, working with the company’s founder to break through the $100 million barrier in less than 10 years. When the founder retired, he took over as CEO and steered the company profitably for another 12 or 13 years.

Then, two years ago, he told me he was going to retire. “Bad idea,” I thought. But I didn’t say anything. I didn’t want to rain on his parade.

So he retired. The company threw him a big “goodbye” party, and I was one of dozens of colleagues from all over the world who flew in to help him celebrate.

A few weeks ago, he emailed to let me know that he and his wife would be vacationing in South Florida. I was eager to catch up with him, so we made a date to meet at The Green Owl, my favorite breakfast spot in Delray Beach.

“How’s retirement going?” I asked, as the waitress plunked down two cups of coffee on the table.

He shook his head.


His was a story I’d heard many times.

Before he retired, he was the man. He was not just the big boss. He was the guy you went to when you had a problem you couldn’t solve. The business thrived on his ideas and his energy.  So when he announced his retirement, the company’s top execs were in a panic. They tried to convince him to at least keep working with them as a consultant.

As a courtesy, he stayed an extra two months to make sure that everything was buttoned up. And he told them that after he’d had some time to enjoy retirement, he’d be happy to talk about that attractive consulting gig.

It wasn’t long before he realized that he missed the problem solving he had always been so good at. So he contacted his former fans at the company.

Much to his surprise, they weren’t so eager to talk to him. And when he managed to nail them down to a meet up, they politely hedged for an hour and wished him well, but he left without a consulting job.

He kept at them for a while, identifying a half-dozen specific ways he could help them cut expenses and increase profits. They demurred. Finally, he reached out to the founder, his longtime partner in building up the business. “Sorry. I don’t call the shots anymore,” the founder explained.

So here he was, 18 months into his glorious retirement, unable to get back to doing what he did best. And feeling that he had devoted his best years to building a successful business that was now scorning him.

I should have said something…

In fact, I should have sent him one of the essays I’ve written about this subject.

Retirement has indisputable attractions. But as I learned the three times I tried and failed to retire, it also has three unexpected consequences.

* When you retire, you give up your active income. Without an active income, you are dependent entirely on passive income. When you are dependent on passive income, you are more likely to make unwise, wealth-damaging investment decisions.

* Unless you have a fair amount of brain damage, spending four or five hours on the golf course is not a pleasant way to spend your day. Likewise for shuffleboard, board games, and other activities that seem like a lot of fun when you have a full-time job.

* If you do retire and decide you’ve made a mistake, it’s difficult to come back. For one thing, nobody really wants you back. (Although they may pretend otherwise.) The current management of the company you left will see you as an old timer with old ideas that will clog things up and get in the way. And they are probably right. Things change fast today. Six months of being away will put you one step behind. A year of being out of the trenches will set you back by a mile. And two years? Forget it. It will be obvious, even to you.

Is there a solution?

Yes. In fact, there are three.

  1. If you own the business, don’t retire. Let other people run it. But don’t give up the captain’s wheel until you are on a walker.
  2. If you don’t own the business but have serious skills, create a retirement job for yourself long before you retire. Figure out something useful you can do that you would now, as a senior executive, pay for. And enlist all your clients, including the business you work for, before you retire.
  3. If you have a regular job with a regular business, start a side business now. Work it nights and weekends till it’s giving you whatever extra income you need for retirement. Then, when you want to, you can quit.
Continue Reading

Advertising Advice: A 9-Step Process for Producing Irresistible Offers

A huge mistake many, if not most, direct response marketers make is to pay scant attention to the offer.

Many years ago, a colleague of mine and I developed a protocol for reviewing and revising marketing copy ( the “Peer Review”), that is used today by businesses all over the world.

It was a low-stress, time-efficient, non-critical way to identify weak copy and make good copy better.

Recently, I introduced a similar strategy for reviewing and improving direct response offers. (The offer is essentially the proposition you make to the buyer at the end of the sales pitch: “Here’s what you get. Here’s the price. These are the terms. And here’s the guarantee.”)

Although they say “copy is king,” anyone that understands how direct marketing works knows that of the three elements that comprise a sales promotion, the first in importance is media (the list you go to). The offer is second. King Copy is third.

That’s why I’ve always urged my clients, employees, and marketing protégés to devote as much time to the offer as they do to the copy. I’ve sung that song for many years, but I was usually singing into the wind. To change behavior, you need to give people more than a good idea. You have to give them an instruction manual.

So here’s a preliminary instruction manual for the Offer Review:

* Enlist. 4 to 6 people to participate, including the copywriter.

* Circulate. the draft of the promotion, including the existing offer, so they can read it before the review.

* Refresh. Ask the reviewers to skim the promo again at the beginning of the meeting, so that both the copy and the offer are fresh in their minds.

* Rate. After they’ve finished skimming the promotion, ask them to rate the offer, from 1 to 4, based on how compelling it feels to them.

1 – Not very interesting.

2 – I’m thinking about it.

3 – It sounds good.

4 – This is too good to say no!

* Discuss.  Allow everyone to explain his/her rating. Have a short, general discussion of the copy’s strengths and weaknesses and how that affected their feelings about the offer.

* Question. Ask, “After reading the promotion, what possible objections or doubts might the prospect have at this stage? Enumerate them.” Then ask, “What can we do in terms of the offer that can answer these questions and/or overcome these objections?”

* Challenge. Ask, “How else can we strengthen this offer? How can we make it absolutely irresistible to our prospective buyers?”

* Finish the meeting with a recap of what the new test offer will be.

* Follow up with a note to everyone confirming what they will be testing.

This is just a first draft of the Offer Review. It will need to be refined through practice. But although it’s not perfect, it’s roughly right and should be very useful to any marketer that wants to achieve maximum results.

Continue Reading

He wanted to know: Did he need to get an MBA?

At my niece’s college graduation last week, one of her friends asked me whether I thought getting an MBA was worth it.

I have no problem articulating my opinions when I’m writing or speaking to the many. But when an individual asks for my thoughts, I’m reluctant to provide a definitive answer. Because results, as they say, do vary.

I don’t want to bump into the same person in 10 years and discover that I ruined his life by giving him bad advice.

My answer, therefore, was a moderated version of what I’ve been saying for many years: You definitely do not need an MBA to succeed in business. You may need an MBA to be accepted for certain jobs – to work for a large bank, accounting firm, business consulting firm, and so on. But for the most part, those are safe jobs for ambitious plodders. Not the kind of jobs I’d normally encourage anyone to pursue.

Many would not agree with me. I know parents that have encouraged if not begged their kids to get MBAs. And many of them, millennials, listened. MBA programs are proliferating, and the number of MBA graduates in the US has doubled to almost 200,000 in just a few years.

If you want to be a doctor and save lives, I find that admirable. If you want to be a lawyer and fight injustice, I admire that too. Anyone that dares to be a teacher deserves not just admiration but awe.

But I have a feeling that most people who pursue an MBA do it because they see it as a safe and predictable way to make a good income. That’s not a wise way to move into a career.

Let’s face it, most of the fun and the profit in a career comes from getting involved with an up-and-coming business and then rising to the top as it grows. To do that, you don’t need an MBA. In fact, as I have argued many times, you would probably be much better off with a much less expensive liberal arts degree.


Here’s how I explained it in an article titled “The Case for a Liberal Arts Education”:

A liberal arts education teaches you three skills: to think well, to write well, and to speak well. And in the corporate world – and in the entrepreneurial world as well – wealth is created by analyzing problems, figuring out solutions, and selling those solutions. In other words, a liberal arts education is tailor-made to give you the skills you need to succeed in business. And not just to do well. I’m talking about going all the way to the top.

 Businesses have one fundamental problem that presents itself endlessly in different disguises: how to sell products/services profitably. There are many, many solutions to this problem. Even in a specific situation on a specific day, there is always more than one. And the person who can regularly come up with solutions – and convince others that his solutions should be implemented – is the person who is going to get the rewards. The money. The power. The prestige.

 Yes, you can improve your thinking, writing, and speaking skills while enrolled in [an MBA program]. But it will happen indirectly and additionally. It won’t be what you are mainly concerned with. With a liberal arts education, you ensure that you will spend most of your time learning and practicing the very skills you will use later to get your ideas and solutions sold.

Of my three sons, only the third one got an MBA. He told me that it was valuable at the beginning of his career. (He became a copywriter for an investment publishing business.) But now, after less than five years, he uses very little of what he learned about business in his master’s program at the University of Denver.

Think of it this way: What skills and knowledge are you likely to acquire by spending two or three years on an MBA?

You will spend a fair amount of that time studying business management. But IMHO, business management cannot be taught. It can only be learned by experience.

You will also almost certainly take a few classes in business ethics. These are popular to the point of being requisites in many MBA programs today. But business ethics is a vacuous idea. There is only ethics. And that is something your parents either taught you or they didn’t. You can’t learn it in school.

What about accounting? The only accounting you need in business (if you are not an actual accountant – a dreadful occupation) you can learn on your own. Ditto how to read a P&L and a balance sheet. And basic statistics (which has helped me avoid all sorts of mistakes).

The bottom line: If you are mildly ambitious, moderately intelligent, and risk averse… by all means, get an MBA.

But if you want to work for a growing business, doing interesting projects, taking on exciting challenges, and eventually conquering some portion of the business world, skip the MBA path and devote those years to learning on the job.

Continue Reading

How You Can Give Away Money Without Paying Even MORE Taxes on It

I know. This sounds obnoxious. But one of my top financial priorities these days is giving away the wealth I’ve accumulated.
What most rich folks do is hoard everything they’ve got until they croak. Then they have it distributed post-mortem by lawyers working with trusts and wills.

From everything I’ve seen and read, this is a terrible idea. The good feelings you imagine your benevolence will engender most often devolves into bitterness, resentment, and altercations among those you leave behind.

I like what Warren Buffett did when he was about my age. He gave a huge chunk of his wealth to Bill Gates’s charitable foundation. Buffett understood that giving away billions was an enormous responsibility. So rather than simply naming some charities in his will, he put the money in the hands of someone he trusted to put it to good use while he (Buffett) was still alive.

K and I have the same general idea: We want to give away most of our money while we are still alive. We are assigning some assets to fund several charities that the family foundation currently manages. (So they will be self-funded in perpetuity.) And we’re putting other assets into the family limited partnership, which will be directed by our sons. But we are also in the process of giving away money to friends and family members. This we are doing with the help of legal counsel.

Not surprisingly, the IRS has restrictions on how much you can give away and to whom. These encumbrances are embodied in the tax code. If you exceed those limits, you (not the recipient of your gift) must pay a tax on it. And, yes, that means you have to pay a tax on money that has already been taxed.

The current limit on yearly gifts is $15,000 per person. So as a couple, K and I can give $30,000 a year to whomever we want without incurring a gift tax.

This is not a problem if you and your spouse want to give, say, $90,000 to your ne’er-do-well brother John. You can do it, tax-free, in 3 years. But if you want to give him enough to keep him in spam sandwiches and reefer for life, you may want to give him $300,000. That will take 10 years.

In our case, $30,000-a-year gifts won’t make a dent in the amount of money we want to disburse. And happily, there is a way to do what we want to do withou tpaying yet another tax on our money.

It’s called the “lifetime gift tax exemption.” Here’s a summary of what I’ve learned about it: READ MORE

Continue Reading

Copywriting: A Great Freelance Gig, But Is the Market Overcrowded?

I’m retired but I need income. What’s the best part-time retirement job?
I’m sick of the nine-to-five. How can I make good money working from home?

Whenever I’m asked these questions, I do my best to list four or five options. But my favorite – the one I want to recommend to everybody – is copywriting.

Copywriting has always been a lucrative and rewarding profession, especially for independent-minded people. But since the internet revolution changed global commerce, it’s become one of the very best ways to make part-time freelance money.

In addition to far-above-average compensation, copywriting offers many lifestyle advantages:

* working from home or while traveling

* being in charge of your own time

* choosing your clients

* choosing your work

* having an unlimited intellectual challenge

And if you master a niche, you can get rich. Multimillion-dollar rich.

Perhaps the most surprising thing about copywriting is that you don’t have to be a good writer to do it. Many successful copywriters would deny this. They want you to believe that the work they do is art. They want to think of themselves as direct-response Fitzgeralds and Hemingways. But they are not.

That’s because copywriting is fundamentally a selling – not a writing – skill. And anyone that is willing to put in the work can learn how to sell.

As you may know, I have an interest in a business that teaches copywriting (AWAI), so it would be fair to accuse me of bias. But that doesn’t mean I’m wrong.

However, because of AWAI’s 20-year history of successfully training thousands of people to be copywriters, dozens of smaller programs have popped up. And this has led to speculation that the supply has overstepped the demand, and that the prospects for new people coming aboard are not good.

That may be true… unless, of course, you get really good at copywriting.

This is the position that Master Copywriter Bob Bly took in a recent blog post. He made his point by quoting this from P.T. Barnum’s The Art of Money Getting (Great title!):

No profession, trade, or calling is overcrowded in the upper story. The basement is much crowded, but there is plenty of room upstairs.

Wherever you find the most honest and intelligent merchant, or the best anything, that man is most sought for, and has always enough to do.

Whoever excels all others in his own line, if his habits are good and his integrity undoubted, cannot fail to secure abundant patronage, and the wealth that naturally follows.

“Study and practice, coupled with dedication and effort,” Bob says, “can propel you into the top 10% of copywriters in terms of ability and results – enabling you to enjoy success, good income,and financial security. Do that and you will have all the work you need and you will earn more. And you’ll earn 2 to 10 times more than 90% of the other copywriters out there.”

But there are so many opportunities! So you really don’t have to become one of the best to get all the work you want. And although you probably do need to be an elite copywriter to make $500,000 to more than a million a year, you can make good money – $50 to $200 an hour on a part-time freelance basis – with just mediocre skills.

Consider this: In my day, you’d need a college degree to land a job in the advertising industry. But as a freelance copywriter, nobody’s going to ask you for a CV. They will just want to know what you have done and they’ll want to see samples. And even if the only thing you have is samples that you did as a copywriting student, it’s not difficult to get a test assignment. If you do well with that, you’re on your way.

Eventually, you’ll have more work than you can handle. That’s when you raise your fees – 50 grand, 100 grand… the sky’s the limit!

Continue Reading

6 Ways to Maximize the Potential of Your Superstars

CB recently wrote to me about one of his superstars – a promising young (23-year-old) copywriter who has already contributed many great ideas to the business. In fact, he’s so good, that CB is worried about losing him.

“I’m giving this young man the training courses he thinks will help him and the company, giving him autonomy in content, web design, and other projects, and helping him find ways to generate more income,” CB said. “But how do I continue to support him?”

Here’s what I told him…
That’s a very good question.

It’s so important that I’ve written about it many times over the years. And I’m thinking about it right now because I’m involved in an imbroglio over one of Agora’s top marketers leaving one franchise to join another. He’s leaving because the publishers did not listen to the following advice:

Extreme Value…

Recognize the value of your superstars. You can populate your business with good and great employees if you put the work into it and create the right environment. But superstars – they are rare. A superstar is worth 5-10 great employees.

Risky Business…

Recognize the fact that you cannot hide them from the competition. I can’t tell you how many times I’ve seen very smart CEOs try to do this. It works for a while. Then one day a competitor discovers them and makes them an offer that is way above what they are making. When that happens, you are screwed. You can offer to meet or even beat the new offer, and you might even retain that superstar. But he/she will never trust you and always resent you.

The Hook…

Understand what motivates them. Superstars are not motivated primarily by money. Nor is praise a sufficient reward. What superstars want and need most of all is the opportunity – the freedom and the support – to accomplish great things. That is what makes an otherwise great employee a superstar.

The Game Plan…

Compensate them strategically. Money is not the primary motivation, but money matters. Superstars should be paid a base plus incentive compensation. The base should be just above (maybe 5%) what someone else would offer them to do the same job. (And by that, I mean someone else that recognized their value.) The incentive compensation should be structured so that they could make a shitload of money – even more than you. But it should never be so much that they are getting more than they clearly deserve.

The Trap…

Don’t overcompensate. This last point is complicated. It’s easy to overcompensate people with incentive plans. And when you do, you can spoil them to the point where you will have to let them go. I don’t have time now to get into all of that. But in this case, since the young man is a copywriter, the challenge is easier to meet because there are existing formulas that work. You are probably familiar with them. If not, I can send you some examples.

One Final Thing

Despite what I’ve said, when your business is relatively small (as yours is), you may not be able to compete with the sort of compensation he could get at a company like Agora. Even if you gave him the same base (say, $80,000), it would be nearly impossible for him to make the same incentive compensation with you because your file size and revenues are too small.

Instead, you have to make him feel like he is working for a good business that is doing good. From what I’ve seen, you are already doing this. In fact, I’m sure you are already doing much if not all of what I’ve suggested above. But I thought I’d write it down this way so I could publish it in my blog and kill two birds with one stone!

Continue Reading