The Millionaire Fastlane - MJ DeMarco

The Millionaire Fastlane is a wealth-building book written by MJ DeMarco in which he outlines the three paths you can take to financial freedom: the sidewalk, the slowlane, and the fastlane.

He outlines the three different paths and explains how society makes you believe that you are in the fastlane when, in fact, you are wasting your life working for financial freedom.

His take is to create your own fastlane to financial freedom by sacrificing 5 years of your life in the present to build a business or investment to gain 40 years of freedom in the future.

In order to achieve financial freedom, one must first understand the lane they are in and how to jump from one lane to the other.

Here are the main takeaways I got from reading the book and how they are helping me take the fast approach to becoming wealthy.

1. 3 Types of Lanes to Financial Freedom

Sidewalk: Poverty

The slowest and worst lane to be in. People in this lane are usually job hopping from one to another for a mediocre increase. They live on paycheck-to-check and probably use the word "YOLO" more than anything else.

They do not have any goals and often think that they don’t have the means to achieve them. Then, when they turn 50 years old, they realize that they screwed up and did not prepare properly for their retirement.

These people never achieve financial freedom.

Slowlane: Mediocrity

Most of us identify with this lane. This is the lane for employees that trade their time for money. They work for 30–40 years so that they can save up enough money to enjoy their retirement at 65 years old.

When they get to retirement, they realize that they wasted their prime years building someone else’s empire. Their goal was financial freedom, but they chose the wrong lane that society lied about.

These people accumulated wealth that they will not get to enjoy because they ran out of time.

Fastlane: Wealth

The fastest lane to wealth creation. People in this lane understand they will never become wealthy if they do not detach money from time. They start or invest in businesses that generate them passive income.

The ultimate goal is to become financially free early so that they can enjoy retirement in their prime years. They value time more than anything, even more than money.

These people sacrifice the very early years of their lives to build a business that can grant them freedom for the rest of their lives.

2. Process vs Event

The majority of people have the misconception that becoming rich or wealthy is an event. That it was an overnight success. However, they fail to realize the process a person needs to go through in order to achieve that overnight wealth.

For instance, you often read about individuals becoming extremely wealthy when their company gets acquired by a major industry leader. You might get stuck in the event of that person making hundreds of millions of dollars from the acquisition.

However, you are ignoring the many years spent building the company. That is the process. Those years most likely had a lot of sacrifices in order to affect people on a large scale. In most cases, it can take 5–10 years to build something that is worth millions.

3. Wealth = Business

In order to reach financial freedom, one must stop working for another’s business and start building their own.

Employees are trapped in the slowlane because they think that they can get rich by working hard at their 9-5. They dream of becoming the CEO of the company. However, even CEOs are not considered to be rich.

This is because their income stream is tied to how much time they spend at their job. No work equals no money. Being rich is all about having passive income streams that generate money while you are sleeping, vacationing, sick, or whatever it is you are doing.

Starting a business will allow you to remove time from the equation. You do not need to spend your entire life working to save up money so you can enjoy the last 10 years of your life.

Once the business is set up and profitable, you can then sell it for a high multiple and reap the benefits of it. But, this has to be a fastlane business.

4. Fastlane Businesses

A Fastlane business is one that allows you to leverage your work. It is a business that solves problems and provides value. It's a business that fulfills a need.

In order to create a business that can survive the fastlane, it needs to follow the CENTS framework. The CENTS framework is composed of: Control, Entry, Need, Time, and Scale.

Control: You should be in charge of the company. It’s you that controls the profit margins, not another entity that can kill your revenue whenever their algorithm changes.

Entry: If it is too easy to start your business, then the competition will be too strong. This means that many more can start the business and take away from the value you can provide. Aim for a high entry barrier.

Need: Do not start a business just because it is your passion. You can only start a business that will solve problems for others. Chase people’s needs and solve them, and you will make millions.

Time: Set up your business to continue running profitably without the need for your input. This will turn the business into a passive income machine.

Scale: How many people can you affect with your business? Your business needs to operate on a large scale to bring in large profits. You will make millions if you have an impact on millions of people.

5. Ditch The Consumer Mindset

Stop thinking about all the things you want. Stop buying things that you don’t need. Stop wasting time on activities that are not beneficial. This is what you need to do to get out of the consumer mindset.

Being a consumer means that you have a constant need to spend time and money on things that you think will bring you happiness. But, the opposite is what happens. You continue to crave the next thing with the illusion that it will make you a happier person, but it never does.

Instead, change to become a producer. Being a producer means that you are creating something to add value to someone’s life. By solving another person’s needs, you start to feel fulfilled.

By adapting a producer mindset, you will eventually start to attract money. Money is drawn to people who provide value and solve problems.

Bottom Line

MJ DeMarco provides an interesting take on the fast approach to becoming wealthy in The Millionaire Fastlane. The main goal of this fastlane is to achieve freedom.

Wealth grants you freedom. The freedom to live your life the way you want and wherever you want. Money buys you the freedom of time.

The fastlane approach is simply building a business that will solve people’s needs and add value to their lives. Then sell that business for a high multiple and start enjoying freedom.