The Millionaire Fastlane by MJ Demarco | Book Summary and PDF

In this summary, you will learn:

• Common myths on getting rich that we need to break
• The 3 kinds of roadmaps people take with regard to wealth
• Your vehicle to wealth and how to make it work
• The 5 commandments of wealth
• How to accelerate your wealth

Despite its title, The Millionaire Fastlane by entrepreneur MJ DeMarco is not about some get-rich-quick scheme. It rather focuses on how to build wealth the right and systematic way.

I’m excited to talk about this book because it’s aligned with the way I think about life and about building wealth in general.

KEY IDEAS

1) Get Rich Slow is Get Rich Old

The book demystifies some of the myths that we know.

EXAMPLE: Getting rich slowly, that is —

• Holding a job for the next 40 years
• Hoping to keep a job in one company or another so that we can retire and enjoy our golden years.
• The idea that at the retirement age of 65, we will have more than enough money saved up in the bank.

These may not always be the case. If you’ve seen how the market crashes had caused odd and hard times, there’s no telling when it can happen again. With that, someone who has invested his whole life on Wall Street or in a steady job could be in for a rude awakening.

We should all stop trying to get rich slow, which is the old way of doing things.

2) Wealth is Not a Road but a Road Trip

One of the biggest concepts in this book is the idea that millionaires are not forged by events but by processes. They follow the step-by-step methodology and the discipline to do the things that need to be done.

A misconception in society right now is that wealth is created by events. This is the sudden-rich idea held by many.

Examples of event-based thinking:

• Striking big on lottery
• Making it big in the stock market

These are not processed-based thinking. There are no events without a process.

Wealth usually eludes those people who are preoccupied by the events of the world rather than the process of building wealth.

Don’t resist the “toll”

One of the fun ideas found in this book which I like is that of “paying tolls.” This refers to taking risks, making sacrifices, and going through hardships as we go on our road to wealth.

A lot of people would argue that we don’t need to do these things in the process of creating wealth, which is absolutely not the truth at all. If we resist the toll, wealth will resist us. If we resist the services, the sacrifices, and the hardships, wealth will resist us.

3) The Sidewalk

Also known as: The roadmap of the poor

Destination: Poverty

Key idea: Wealth toxification (This is where the book points out the value of process as something that creates events.)

Characteristics of “Sidewalk” People

• Living beyond their means
• Going for pleasure today rather than for security tomorrow
• Their mindset is all about enjoying the moment now without any plan or savings
• Having more than they can afford
• They destroy or toxify their wealth
• Don’t want to do the work/follow the process
• Lack accountability; not owning up to their mistakes or failures

The process of building wealth

The outside world sees it as luck, but it’s actually process.

What luck really is:

• a product of acting on the process every day
• doing the hard work
• going after every opportunity you are presented with

How Sidewalk People can improve their probability of success:

• Adhere to process, not some random events or luck
• Take responsibility and stop being victims

That’s when they can start getting out of the sidewalk or ending up in poverty.

4) The Slow Lane

Also known as: The lane of mediocrity

Key idea: Selling off today in hopes of a glorious future tomorrow. You hope to have saved up enough money so you can enjoy your golden years.

This lane destined to mediocrity is prevalent in society today.

The drawbacks:

• Unfortunately, with your job, you are domesticated.
• You’re left with very limited leverage because you cannot afford time.
• You have very limited control over your own future.
• The government can get most of your money in the form of taxes. In effect, you are losing a lot of money.

2 Things Needed in Order to Become Rich:

• Control
• Leverage

Unfortunately, being in a job or in the slow lane, you don’t have both. This is because they are already bought from you by your employer.

What’s left: A long-term hope. You hope that —

• your 401k does not crash
• you have a job until the age of 65
• you’d still be healthy at 65 to enjoy retirement

All of those things are a plan of hope rather than a plan of action and ownership.

One of the things that the slow lane people need to understand is this:

Education begins after graduating from college.  

Slow lane is a game of hope — you don’t know whether you will survive it or not.

It’s not possible to win the money game by playing on defense (saving up while at the same time hoping that the market would not crash).

Simply put, in the slow lane, you’re not really leveraging your assets or playing for explosive growth.

5) The Fast Lane

Also known as: The wealth-building lane

Destination: Wealth

Key idea: Time is the most important asset that far exceeds the money asset.

The fast lane is marked by controllable, unlimited leverage.

It’s possible to get rich quick, but it has to be preceded by a process/effort, by risk-taking, and by ‘paying the tolls’. Thus, while it’s possible to get rich fast, the process may not be easy.

The fast lane is a business system while the slow lane is just a job.

The playbook for wealth: Start getting out of the consumer mindset and get into the producer mindset.

• Instead of buying as an effect of TV ads, sell products.
• Instead of taking a job, hire someone for a job.
• Become a producer rather than a consumer.

How specific event types can make you rich (a result of processes)

An event is when you have created an asset that pays you over and over again. When someone would like to buy you out or you have a public offering, that’s when you get liquidated. Again, these are all preceded by a process.

What creating wealth in the fast lane means:

• Divorcing your wealth from time
• No longer thinking in terms of saving pennies but rather saving time. Business systems break the bonds between your time and your money.
• Living below your means no matter how rich you get.
• A dollar saved every time is going to be fighting for you in the long-term.

Distinct differences between Slow Lane and Fast Lane People:

Slowlaners:

• They trade time for money, which is a job.
• They are a penny pincher because their time is money at that point.

Fastlaners:

• They leverage time through a business.
• They’d much rather save time because time is their greatest asset.

Time is the king of all the assets we have. If you manage your time poorly, you will be poor.

The Law of Effection

The Law of Effection is about the magnitude of your effect on a certain number of people. You could either effect a huge number of people or maybe just few people — but in a huge way.

It is the effect that will give you real wealth.

Therefore, think about the scale of your impact and the impact of the business that you’re planning to get into.

6) Your Vehicle to Wealth (You)

First, Own Yourself

What this means:

• Having a corporate structure in place so that you own the business
• Paying yourself first rather than last or after the government and the retirement payments take away your money from you.

Use Your ‘Life Steering Wheel’

One of the analogies used in the book is the steering wheel, which represents the choices we make.

Just a small shift in the steering wheel can lead you to either the freedom/the highway/the fastest lane OR a brick wall/the freeway/the slow lane.

Therefore, you have to be very careful about the choices you make. Even the small choices will affect your results years and years out in the future.

Both success and failure come from the small choices that are made every day and are accumulated over time.

Jim Rohn once said:

“Success is nothing more than a few simple disciplines practiced every day.”

You cannot just choose to be successful one day and then stop doing the things that you’re supposed to do.

The most powerful control mechanism you can have: Making a choice every day

Making the right choices every day will create the processes that can make you rich.

Success is one choice compounded over again and again. It’s the same with failure.

Wipe Your ‘Windshield’ Clean

The windshield represents making better choices.

The following are strategies that will ensure your ‘windshield’ helps you get clear so that you can make the right choices:

• Worst-case consequence. Ask:
  • What is the worst possible consequence of this choice?
  • What is the probability of that outcome?
  • Is that an acceptable risk?
• Weighted average decision matrix
  • This means giving different weights to different factors and then calculating the overall score

‘Deodorize the Headwinds’

The idea is that the natural state of the masses is to be average, not extraordinary.

With that, you have to be very careful and cognizant of the people around you. Some people will either pull you back or push you back. There are people who might tell you negative things such as, “you cannot do this” or “you can only do so much.”

‘Change that Dirty, Stale Oil’

Changing oil means continuously educating ourselves even beyond graduation so that we don’t stagnate or stand still, and in order for us to move to the fast lane.

We have to refresh or update ourselves by learning new things and getting the ideas in our head.

‘Hit the Redline’

If interest is the first gear, then commitment is the redline.

If interest is quitting after the second failure, commitment is continuing after the 100th failure.

Therefore, it is really important that we commit ourselves fully.

One of the golden lines in the book says,

“If you avoid failure, you will also avoid success.”

This line almost encompasses some of the mysteries of life.

It is important to note that timing will never be perfect. We cannot wait, we just have to attack.

In his book Think and Grow Rich, Napoleon Hill said:

“You can do all the planning you want, but you’ve got to go for it and attack.”

You cannot stop and just wait for an opportunity.

Similarly, during his reign, Napoleon Bonaparte said:

“I make circumstances. I will not wait for circumstances to be right. I will go for it. I will attack now.”

It is therefore crucial for us to never wait for the timing to be perfect. Someday never comes and is a dangerous and paralyzing proposition. We have to do it right now.

7) The Roads to Wealth

This idea refers to the kinds of business you want to get into.

5 Commandments:

1. Need

The amount of money you make in your life is a reflection of the value you’ve added to others. Therefore, focus on solving others’ needs.

90% of businesses fail because they are based on selfish internal needs, not external market needs. It’s the businesses that solve needs that win.

To attract money, forget about money.

2. Entry

You wouldn’t want to get into a business where entry barriers are at a minimum. If they are, then you have to be exceptional.

3. Control

Have a business system that you can have complete control over.

4. Scale

Be able to scale your business in order to grow wealth exponentially. This growth would not be possible without leverage.

5. Time

You cannot have a business that’s tied to your time because in that case, it becomes a job.

It’s the business that earns income exclusive of time that meets the commandment of time.

A business must not tie you up in terms of time.

Rapid Wealth

If all the 5 Commandments of Wealth are met, rapid wealth can be generated.

Today, avenues that can be used in terms of business include:

• The internet
• Innovation
• Intentional iteration – taking a business and continuously improving it

Find the open road

It is up to us to find the open road. The key is to always understand that success in the fast lane does not lie in ideas. It lies in the execution.

This is the same concept explained in Eric Ries’ The Lean Startup, which tells about where the success of any business venture comes from:

• 5% of the success is from the initial idea
• 95% is from execution, pivoting and persevering, or simply from the persistence to try until it succeeds

In The Millionaire Fastlane context, the speed of execution, iteration, going after it, and changing lanes as you see fit will determine the success that can be created for you.

Give the road a destination

• Identify the right targets you are after.
• Chunk them into small goals.
• Work towards them.

Again, don’t think about it as a mountain at once. Just do things 1 step at a time.

8) Your Speed (Accelerate Wealth)

It’s All in the Execution

As earlier mentioned, the speed of success will always lie in execution, not in ideas or planning.

As you start your business and go through your execution, you will start to unearth things. You will come across barriers and roadblocks and you’ll have to change directions at some point. But that is part of business.

That is exactly what the likes of Napoleon Hill and Eric Ries say. A lot of other books also tell readers to worry less about the plan but to focus more on continuous execution, iterating, and changing.

Customers as Pedestrians

The customers are the pedestrians who will make you rich. Therefore:

• Provide excellent customer service.
  • Be able to satisfy them the best way you can.
• Keep the right people.
  • A company is only as good as the people it keeps.
  • Business partnership is like a marriage (a key point in the book Good to Great by Jim Collins).
    

Use Competition to Your Full Advantage

Study and understand the competition’s weakness and then exploit that weakness. Don’t just get commoditized. Become someone’s savior. Do something different.

Build Brands, Not Businesses

Develop your unique selling proposition and rise above the noise. The ways to do this can be as follows:

• Polarize people
• Arouse emotions
• Encourage interaction
• Be unconventional

Choose Monogamy Over Polygamy

This concept discourages trying to start and run a thousand different businesses at the same time. Just focus on one and dig into it. Do as much things as best as you can for it. Once you have it working, then you can move on to the next one.

TAKEAWAYS

Let’s revisit the big ideas in this book:

• Process over events – It’s the processes, not events, that create wealth.
• Be frugal with your time, not money – Slowlaners and sidewalk people are frugal with money but not with time — which is supposed to be the greatest asset.
• The Law of Effection – Serve a lot of people in order to make a lot of money. This means having an effect to a lot of people in scale or a few in magnitude.
• 100% commitment – This means being fully committed, not 99% or 98% committed, in order to reach your desired wealth destination. Not being fully committed will not get things done.
• Timing is never perfect – You will never have the right time. You have to grab the opportunity right then and there because waiting will empower mediocrity.
• Execution is king while ideas are pawns – Don’t get seduced by new ideas. Start executing and start rolling. As you execute, you’ll learn a trade and you’ll get better.
• Focus on one thing at a time – Go for monogamy, not polygamy.

The Millionaire Fastlane is an awesome book and I highly recommend you get it. It has brilliant points and analogies. There is so much wisdom in this book.

Visit http://www.themillionairefastlane.com/ for further learning.

Related Readings:

1. How to Get Rich by Felix Dennis
2. Profit First by Mike Michalowicz