Bottom Line Up Front: The only way to change your position on the Financial Game Board is to change how you earn. If you trade time for money, it’s tough to grow your skill set in a meaningful, impactful way. Start thinking how you can stop trading time for money. Doing so is difficult. You must know yourself, the game, the board and choose the right rules. If you start to do this, you will begin to awaken your inner CEO.

Breakfast at The Cosmos Club: “Shannon, would you like to meet with George Soros’s money men?”

It was 2002 in Washington DC. I had just left the Army as a Lieutenant Colonel. A Washington, D.C. Defense-Intelligence Think Tank Titan invited me to The Cosmos Club. He listened with hawk-like attentiveness to my insanely ambitious first business plan. He wanted to invest and invite others to invest. He poured me a cup of coffee and asked,

“Shannon, would you like to meet George Soros’s money men?”

I had never heard of George Soros, so I said, “Sure.”

At the end of this blog post I will tell you the mistake I made and what happened, but here is some of what I learned from my own inner CEO about being employed versus being self-employed.

Deserve Victory.

Improving and strengthening yourself affects everything around you because you are the constant in your own life. You are the X Factor. So, improve yourself, be a student, learn. Learn to deserve what you are built to deserve—the dignity of responsible freedom. The struggle to achieve that freedom strengthens us as men. A man’s struggle to stand on his own two feet ennobles him and focusing on being virtuous makes success more likely. If we are hard on ourselves, we earn what we achieve and are more likely to keep it without spinning out of control and losing all we value, so first, deserve victory.

Next, Recognize That The Economy Is Changing Fast.

Our economy is changing fast, so you need a framework to understand it. When it comes to men making money, there are four ways and Robert Kiyosaki puts them in a manageable framework. You can be an employee, self-employed, own a business, or be an investor.  In this example we’ll just talk about being employed or self-employed. Most of us are employees. It’s easy and puts you to sleep. I’m not disdainful of employees, we just have to keep our eyes open if we are one because things are changing quickly for employees. Before 1991 an employee could enjoy a high quality of life, do meaningful work and retire with dignity, but that’s an outdated scenario, now, because of taxes and inflation. Technology, though, has opened up options.

Technology has unified the global economy and given employees all over the world more options than ever before. Global integration and the internet have shifted everything, but we must be versatile and adaptable in a world where technology, inflation and taxes are completely re-mapping the global economic landscape. The good news?  You can choose where you want to be as the global financial struggle unfolds. The other news? The clock is ticking.

Adapt or Die: Being a 21st Century Employee

Employees trade time for money for Earned Income. Earned income is the lowest quality of money because it is taxed at the highest rate and is eaten away most quickly by inflation because employees have the fewest tax advantages. Moreover, being an employee traps you by training you to entrust your welfare to someone else. If you get a W2 you’re an employee (A cool exception is if you own the company that employs you.). You can use being an employee to your advantage if you leverage other streams of income, but essentially being an employee is a short term solution to a long term problem. Most Americans have been employees the majority of their lives. The danger of being employed is that it makes you dependent. Your financial-emotional intelligence weakens. Oddly, men with the most security are most risk averse. As an employee you think you have a safe, secure job, but it’s in someone else’s hands. Is it smart to have a single source of income controlled by someone else?

The employee’s choice: Playing on someone else’s field with their ball and rules or the cold, shark-infested waters of freedom?

A job is a valuable short term solution to a serious long term problem. It’s a good training ground for virtue: humility, servanthood, frugality, but the employee model is based on scarcity and the resources you need belong to someone else. Our goal at AM is to help you move to a hunter-gatherer model of abundance and opportunity while increasing your value as an employee. As an employee, you see things from an employee’s point of view, and you do gain a useful perspective on your ultimate goal of financial freedom. Being an employee also provides a steady source of income as you work part-time on other projects.  You learn to play by the rules, and to be bound by a contract, which is crucial because you acquaint yourself with a sacred concept: a fair day’s labor for a fair day’s wage. Playing on someone else’s field with someone else’s ball requires you play gracefully and gratefully by their rules to succeed. But if you want to change your life and participate more fully in the global economy, you have to get more adventurous.

On a raft in the ocean surrounded by sharks

Being an employee is like being on a raft in the ocean. While you work you rest, recuperate, help others, but remember that with each passing day you are weakening unless you exercise vigorously and prepare to get back in those cold, strong, shark-infested currents.  Shark infested strong currents are your true home as an independent man. You, as a man, are built to be strong, quick, agile and predatory, so think of other ways to make money.

Consider The Self Employed

Like employees, the self-employed also trade time for money, but have huge tax advantages and more freedom.  And, though more free, the pain of being self-employed can be acute because you do everything to keep your business moving forward. Your efforts rarely are system-based. As a self-employed you have freedom because you work for yourself and you can take advantage of tax breaks, but to build your business you must do everything.  I have been self-employed as a Defense Consultant to the US Government, as a business leadership consultant to a handful of small businesses, as a seminar speaker and as an author. You’d be surprised who is self-employed. Most lawyers, doctors, realtors and dentists are self-employed. There is no shame in being self-employed, but here’s the test, “If you stop working, does your income stop?”

If you answer yes and you’re not an employee, you’re likely self-employed. You may be skilled, brilliant, and in demand, but if demand dries up and the money stops flowing, look out. I knew a surgeon who confronted this reality after being laid up from a cycling accident. He thought he was free but still worked long hours to keep money flowing and had mountains of debt. Short-term solution. Long-term problem.  If you’re self-employed you can leverage the advantages of other streams of income to your advantage. Being self-employed can be very profitable. Think of a radio talk show host, an independent teacher or coach or a trusted expert in a profitable industry. However, smart S’s productize their services. That’s good news in the age of communication, but requires a team. Self-employeds can also market to build a community on line and use advertising as a revenue stream.

Little leverage as self-employed: waiting for a check at an empty mailbox with my wife and children at Christmas

When you’re self-employed you don’t tend to learn how to achieve financial victory because you’re doing everything yourself. As an independent consultant I brought value to my client every day. No problem. I teed up the next client. No problem. Billing? No problem. Advertising? Marketing? No problem.  Accounting?  CRM? No problem. I did all these things but I still had to wait for a check because I had little leverage. It was depressing and I can still remember going to the mailbox at my Post Office box looking for a check that came too late for Christmas.

It’s like being on a tread mill going way too fast.  Very depressing to go to the mailbox looking for checks that hadn’t arrived. When you’re self-employed you tend not to delegate and since you don’t delegate you don’t learn to trust other people. Worse, you may unlearn those things. The most deadly attitude of all is, “If you want it done right, do it yourself.” Don’t doubt me. Become an independent consultant, do everything yourself and sustain that pace through a couple of Quarters. You can do it, but man, it’s tough. To succeed as a self-employed you have to be a Superman.

Me to my [Superman] client: “You don’t own a business, you own a job.”

I did a consulting gig for a business owner who behaved as if he were self-employed. A business owner who remains self-employed is a sad nightmare. He had hired me to systematize his business.  He said, “Shannon, you’re an Army guy. You’re an IBM guy. You know systems. Turn my business into an annuity that pays me and you can have it.” The deal was this: the owner wanted to move to Singapore. He told me all he needed was a certain amount of money per month. If I could get his business to give him that amount of money per month I could have the business and keep the surplus while it continued to support him.


The numbers looked great. Lots of profit. Strong track record. Loyal customers. Nice, nice arrangement, it just needed to be systematized. I dug in and quickly learned it was impossible to put systems in place because he had made himself central to all aspects of the business.  Control was more important to him than a successful business. The business was all him and impossible to sell to an informed buyer. In fact, he didn’t have a business, he had a 60-70/hour-a-week job he couldn’t sell. The buyer we found bought the business on one condition: the owner stay as a consultant.

The two-edged sword.

The weakness inherent in being self-employed is the strength. When you’re self-employed you exhaust yourself doing everything, but by doing everything you learn everything. Essentially you are the business so you learn all the advantages of the business, it’s just not sustainable. You learn the tough lessons and close quarters hand-to-hand combat of business and it’s useful to know from experience the pain of doing everything yourself, but it’s exhausting so you run out of steam or the quality of your work starts to suffer. Or both.  Simultaneously. If you’re self-employed from a position of strength it can be great, but if you lose your footing or enter the ring weak, watch out. Think of self-employment as a stop on the way to something better.  As with being an employee, too, you can be self-employed on hire to your own corporation or as a complement to another effort. The key is to be aware of how those actions affect your progress to your ultimate goal. Different financial skill sets wring different nutrients from money. Learn how to make the different skill sets work together. 


The Rest of The Story: What Happened With My Friend From The Cosmos Club

He did line up an opportunity for me to meet with wealthy backers. The problem was that I put together an NDA (non-disclosure agreement) that was so tight and binding it scared them away. I thought I was being smart and I was communicating over-control and paranoia, so the deal fell completely through. In hindsight I (think I) was thinking like a self-employed who wanted to control. If I was thinking like a business owner I’d have been a lot more open with men whose help I needed, but that kind of trust comes with confidence, which I lacked.

Call to Action: Write down three things you like and three things you dislike about being an employee. You may like the consistency and reliability of a paycheck and having an established schedule and working indoors. If you’re salaried, for instance, you may not like that you cannot make more money by working harder. You may not like that your promotion is decided by someone who does not know you well.  Now, ask yourself what you can do to change the three things you dislike and improve the things you like. Believe it or not, you are waking up your Inner CEO.