Why Owning A Business Is The Most Reliable Path To Financial Freedom For The Majority

Summary

A statistical analysis of millionaires shows that most derived their wealth not mainly from stocks but rather from owning equity in private companies. Stocks carry numerous uncontrollable risks and require significant upfront capital. In contrast, business ownership utilizes key leverage tools like knowledge, skills, time, and social resources. It also enables greater control, full information, and better risk-reward probability.

Timestamped Highlights

rocket Research shows only 12% of millionaires say stocks were key to their wealth creation while most point to private business equity.
money_mouth_face To profit immensely in stocks, you need sizable capital. Getting it typically requires already being wealthy.
scales Wealth insulation helps the rich stomach stocks’ high risks since failures aren't catastrophic. Most people lack this resilience.
four_leaf_clover In the complex system of the market, luck plays a huge role. The wealthy get more 'lottery ticket' chances to hit it.
toolbox Business ownership enjoys leverage tools like reusable intellectual property and social resources rather than just money.
video_game Unlike stocks where effort is often fruitless, active business involvement boosts control and chances of success.
shield Whereas stocks challenge human nature, business success lies more in utilizing it. This makes the probability game easier.

Key Insights

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Why Most People Can't Get Rich Through Stocks: The odds are stacked against the average person due to innate requirements around capital, concentration, risk capacity, holding power, luck and psychology.
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Why Business Ownership Is More Reliable: It lends itself better to leveraging non-monetary assets, dictating outcomes, managing risks, persisting, trying luck with less money at stake and operating by human nature.
scales
Stocks For Wealth Preservation, Businesses For Wealth Creation: Stocks serve the wealthy more as a way to protect existing capital. Average individuals should focus first on wealth generation through owning equity.
toolbox
"Business" ≠ Venture-Backed Startup: It can simply mean a sole proprietorship or side gig. The world is full of accessible microbusiness opportunities.
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Sorry For Peddling Half-Truths: Financial influencers often ignore the prerequisite entrepreneurial foundations of supposed stock market success stories. Building wealth passively is rare.
money_mouth_face
We're All Running Businesses Already: Even as content creators, we employ the leverage of technology, intellectual property and audience value to profit. Our fans can do this too!
rocket
Disregard The End State, Focus On The Process: Chasing superficial status symbols like exotic vacations prevents seeing the incremental groundwork that enables them, like savings.
This blog is a summary of a YouTube video "大實話: 財富自由不能靠股票,還得“擁有生意" - YouTube" by MoneyXYZ