“He fed you manna in the wilderness, [a substance] which your fathers did not know, so that He might humble you [by dependence on Him] and that He might test you, to do good [things] for you at the end. Otherwise, you may say in your heart, ‘My power and the strength of my hand made me this wealth.’ But you shall remember [with profound respect] the Lord your God, for it is He who is giving you power to make wealth, that He may confirm His covenant which He swore (solemnly promised) to your fathers, as it is this day.” (Deuteronomy 8:16-18 AMP)
Deuteronomy 8:18 says that God gives us the power to make wealth. Now, this doesn’t mean that God serves as a private investor who makes money for us. However, it does mean that He gives us the power to do so. Scripture also says that the wealth of the wicked is laid up for the righteous (Proverbs 13:22). If that’s true, the Body of Christ needs to start putting their power to get wealth to work! So, that leaves me with a question: Do you know how to make money?
Making money requires a different skillset than earning money does. There are two ways money comes into your life: you acquire it, or you make it. Working a job and earning a salary is wonderful, but I like to say it this way—nobody built wealth by earning and saving alone. In this blog post, you will learn the foundation of how to make money, as well as the three primary pathways where you can do so.
Everybody has goals and dreams for what they want to accomplish in life. Whatever ‘that thing’ is for you, I can bet that you’ll need resources to see your dream become a reality. Perhaps you want to start a ministry or nonprofit. I’ve spent most of my life in ministry circles, and here’s the problem I always see people run into: people have a mission, but they don’t know how to actually make it happen in terms of organization, management, and especially finance. At WealthBuilders, our mission statement is “Making sense of making money for making a difference.” The middle part is where people typically get hung up, and it makes the third part increasingly difficult.
Three Levels of Money
Several years ago, I was thinking and praying for a way to describe a 30,000-foot view of how to make money. God led me to a revelation what I now call my Triple X Factor, and it breaks down the wealth building process. Within the Triple X Factor, there are three levels of money.
The income you earn from a job is classified as First X income. That’s your starting point. This is money you work for, and it is non-leveraged. Your payment is directly connected to the time you work.
Once you are able, you can begin to invest your First X income into assets that pay you in passive income (payment from investments.) The payments from those investments are classified as Second X Income.
Once you really start running and gunning with your investments, you’ll reach financial freedom. This is the point where your Second X income (passive income) exceeds your First X income (earned income). In the United States, only about 3% of people get to this stage. At this stage, you have some options. You can reinvest your passive income and attain Third X income. At this point, you are able to give your money away and invest in kingdom minded causes.
The Foundation of Making Money
Knowing how to make money starts with creating or predicting value. Businessowners create value for their consumers through products and services. Investors predict which assets they think will increase in value and put money behind them. When you create value, you serve others. That is one reason why Christians should see their businesses and workplaces as a primary arena for ministering to others.
I began teaching my grandson Brayden how to create value when he was eight years old. We went out on a Saturday morning and found a garage sale that had an old, broken-down red wagon. It was rusted over and missing a wheel. We paid $2, and the hunk of junk was ours.
We took the wagon home, and I found some black and red paint in my garage. We bought a new wheel. Then, Brayden did a lot of the sanding and painting. When it looked like new again, we put it out in the driveway with a ‘for sale’ sign. We were able to sell it for $20! Aside from the cost of the wheel, Brayden and I made an $18 profit all because we created value.
If learning how to create value (and therefore money) intrigues you, keep reading. There are three primary pathways we use at WealthBuilders to teach people how to make money: real estate, investing, and business.
Real estate investing is the purchase, ownership, management, renting, or selling of property for a profit. I like real estate investing because it has intrinsic value. People will always need a place to live, and having a safe, comfortable home is valuable.
There are many real estate investing strategies you can use to make money, but in this blog, I’ll touch on buy and hold real estate. The first step to buy and hold real estate is to buy a property for less than it’s worth. This gives you instant equity. Then, you list the property for a rental price that is at least $300 above the cost of your PITIM (principle, interest, taxes, insurance, and management.) There are formulas you can use so you can confidently cash flow and know how to not overpay for a house, too.
Through that $300+ cash flow, you are making money that wasn’t there before. As you save up that passive income, you will be able to purchase more investment properties. Your equity and cash flow will grow, which makes real estate a great pathway for how to build wealth.
If you’re going to build wealth, you must think in terms of leverage. How do you make more out of what you have (while using minimal additional resources?) Good investors are always looking for an answer to that question. When you invest, you are simply distributing money with the expectation of receiving a return greater than what you spent.
Luckily, there are a lot of ways to start investing, and you don’t need a lot of money to do so. Some of these investment vehicles include, but are not limited to, stocks, ETFs and mutual funds, CDs and bonds, precious metals, and digital currency. At WealthBuilders Investment Services, we provide biblically responsible investing options, too.
Business is an excellent way to build wealth and influence a community. Whether it’s through the products and services you provide or the jobs you create, you can have a tremendous impact as an employee or an entrepreneur. When you get the systems and structures in place, your business can generate passive income (and be relatively hands off!)
The basics of business boil down to how Brayden and I renovated the wagon. What are some areas you think could be improved or problems you think could be solved? Can you create a product or service that serves as a solution? Look for opportunities to create value, and don’t be afraid to try out your ideas. You can start small. We live in the age of side hustles—there are a lot of ways to be entrepreneurial in today’s economy!
Knowing how to make money is a crucial step toward financial freedom. If you want to generate kingdom finances, become financially free, and make a difference, you’ll enjoy my new book God’s Road to Financial Freedom. Click here to learn more and pre-order.