The Millionaire Fastlane is a best-selling book written by MJ DeMarco who was the founder and CEO of Limos.com before he sold the business. MJ is a successful entrepreneur and famously known as the revolutionary “get rich slow” anti-guru. MJ is also the founder of Viperion Publishing Corp. and the founder of The Fastlane Forum. His book, The Millionaire Fastlane is one of the most eye-opening financial books that everyone should read.
- PART 1: Wealth in a Wheelchair… “Get Rich Slow” is Get Rich Old
- PART 2: Wealth is Not a Road, But a Road Trip
- PART 3: Poorness: The Sidewalk
- PART 4: Mediocrity: The Slowlane Roadmap
- PART 5: Wealth: The Fastlane Roadmap
- PART 6: Your Vehicle to Wealth: YOU
- PART 7: The Roads to Wealth
- 1. The Commandment of Need
- 2. The Commandment of Entry
- 3. The Commandment of Control
- 4. The Commandment of Scale
- 5. The Commandment of Time
- PART 8: Your Speed: Accelerate Wealth
Overall, The Millionaire Fastlane is a book that focuses on the concept of getting rich quickly and the MJ also points out the major flaws with the old idea of “studying to get good grades in school, work hard, save money, and then retire rich” model. He defines what it means by becoming rich and his own concept of creating wealth, plus, MJ also shows you the path how you too, can retire rich and young.
In this article, you will discover the summary of the book and some of the major and important points that MJ shares to his fellow readers.
PART 1: Wealth in a Wheelchair… “Get Rich Slow” is Get Rich Old
MJ DeMarco grew up in Chicago and he was a porky kid with only a few friends. And like most kids these days, he is interested in video games and donuts more than sports chasing the girls. MJ grew up in an ordinary neighborhood and he used to watch a lot TV.
One day, MJ came across an incident that changed his life forever. While he was out to buy his favorite ice-cream, he saw his dream car, a Lamborghini Countach. He was awestruck because he liked that car so much and worshipped the car like a God. Then, MJ saw the owner of the car walked over who looked like a 25-year-old dressed in blue jeans and an over-sized flannel shirt.
MJ couldn’t believe his own eyes because he expected the owner of the car to be much older. As what most people believe, there is no way one can earn so much money at such a young age while still has the time and energy to enjoy life. What MJ did then was that he went up to the owner and asked that guy, “May I ask what you do for a living that allows you to afford such an awesome car?”
And the owner of the car responded, “I’m an inventor,” and drove away. MJ stood there frozen in disbelief. And that moment changed MJ’s life forever. He started to understand and exposed to the Fastlane. From then on, MJ began his search for the millionaire Fastlane method rather than buying into the ideas where people have to work hard for tens of years and save all their money to retire rich and old, he wanted to retire rich and young.
Most people have the wrong perception of wealth as in they believe that getting rich has something to do with talent and fame. Just like the young MJ, he believed that he needed to be a famous athlete, a celebrity, an actor, or super talented in order to get rich. However, this is not the case.
PART 2: Wealth is Not a Road, But a Road Trip
In the second part of the book, you will learn that why the old adage “get rich slow” is a losing game and it demands a long life of painful employment. The real golden years of your life are when you are young, vibrant with energy and sentient, not when you are old and have no energy to enjoy your wealth.
You have to understand that wealth is a formula, not an ingredient. And it is the process that makes millionaires, not events. People focus on events like selling their company or winning a big contract, but the real story is not the event, it is the process, the hard work, and the effort that makes those events possible. And if you skip the process, you will never get to the event.
Besides, MJ also writes that fame and physical talent are not prerequisite to wealth. Change can happen in an instant and wealth is created in an exponential manner, not linearly. MJ also says that there are literally only three types of financial roads: the sidewalk, the Slowlane, and the Fastlane.
PART 3: Poorness: The Sidewalk
The Sidewalkers are people who are living well today at the expense of having more security tomorrow and their destination is being poor.
As MJ explains, the Sidewalkers view debt as an asset and they value spending over saving. More importantly, Sidewalkers live a life of instant gratification and they don’t plan for the long-term.
Being a Sidewalker is dangerous because external events such as job cuts, recessions, and interest rate hikes can be devastating for people who live from paycheck-to-paycheck. It is important to note that being a Sidewalker doesn’t mean that you are poor. There are plenty of rich people like athletes and celebrities who make a lot of money, but they spend like no tomorrow.
MJ also writes that being wealthy is not about money, luxury cars, or expensive vacation. Being wealthy means having the health, surrounded by great friends and family, and the freedom to live life however you want. This is where MJ refers to the 3Fs (fitness, family, and freedom).
Besides that, Sidewalkers tend to pursue wealth events such as hoping to win the lotteries and making money through gambling.
PART 4: Mediocrity: The Slowlane Roadmap
The second type of financial road that most people choose to travel on is called the Slowlane. The Slowlaners sacrifice today so that they can be better off in the future and it is the opposite of the Sidewalk.
This is also another poor choice because wealth is best enjoyed when you are young and healthy, not after decades of the soul-sucking job. Plus, if you travel in the Slowlane, there are many factors that you cannot predict such as recessions and how the market will perform. A lot of people lost over 50% of their savings during the housing and financial crises.
Imagine you give up your time for money, budget aggressively, look for deals and coupons, and save a huge portion of your money and put them into the stock market for long-term compound interest. After going through 20 grueling years, financial crisis hit and you lost most of your hard earned money, how will you feel? This is the Slowlane mentality.
Slowlaners sacrifice their Monday through Friday so that they can enjoy the weekend, Saturday and Sunday. This is just like trading $5 for $2. Do you want to trade 5 weekdays for 2 weekend days?
In general, holding a job will limit your leverage and control of your wealth. It is important to note that when you are holding a job, it means that you are selling your time and your life for money. Apart from that, the experience you accumulate limited. You will learn much more running your own business in a month than working for someone else for a year. Plus, you have no control over your income because your salary is greatly depending on other people, which is your employer.
MJ says that if you are depending on your job to get rich, you have uncontrollable limited leverage because the measure of your value largely depends on your time. You simply cannot 10X your work hours because every one of us has only 24 hours a day.
Another problem with the Slowlane is that compound interest does most of its work at the end of your waiting period. When you take a look at the chart that shows investing $10k will yield $2.5 million in 40 years, which sounds great. However, what most of the Slowlaners never realize is that your investment is $600k in 30 years and $160k in 20 years, meaning to say, a huge portion of the money is accumulated in the final decade.
Now, what if the market did not perform as good in the future or what if you have a heart attack in 30 years? The problem with compound interest is that it requires a long time to see the result and most of the result comes in the final stage. Here is what MJ writes in the book:
“Think about it. Have you ever met a college student who got rich investing in mutual funds or his employer’s 401(k)? How about the guy who bought municipal bonds in 2006 and retired in 2009? I wonder if that guy driving a $1.2-million car can because of his well-balanced portfolio of mutual funds? These people don’t exist because the youthful rich are not leveraging 8% returns but 800%.”
The Slowlane is filled with hope. You hope the stocks go up, hope for a promotion, and hope that you will not be retrenched.
Plus, MJ warns his readers about the advice from “financial gurus”. Some so-called gurus rarely get rich following the advice they give you. In fact, these “gurus” get rich by writing books and selling seminars and courses. When you take financial advice from people, make sure what they teach you are what have actually worked for them.
PART 5: Wealth: The Fastlane Roadmap
When it comes to the Fastlane, it is a strategy that is not much different from the Slowlane, but the rewards from the Fastlane are far greater. Never misunderstand “get rich quick” with “get rich easy”. Here are some comparisons between the Slowlane and the Fastlane:
- Slowlaners take decades to accumulate wealth while the Fastlaners usually take 10 years or less.
- Slowlaners allow the market to control their assets while Fastlaners control their own assets and have the power to change their value.
- Slowlaners are employees while Fastlaners are employers.
- Slowlaners use mutual funds and stocks to get rich while Fastlaners use them to stay rich.
The Fastlane is all about taking a lot of work in the initial stage. You may need to spend 5 to 10 years focusing on your business before you reach the kind of success you desire. The best part is that once you have reached that level of wealth, you will have the freedom to do whatever you like for the rest of your life.
When it comes to building great wealth, the Fastlaners do not focus on the heavy lifting, instead, they learn to create a system that does the heavy lifting. This does not mean avoiding work, but it means being resourceful, optimizing, and automating relentlessly.
MJ goes on to explain using the example of building a pyramid with heavy stones. The Slowlane approach is to carry the stones yourself, one at a time. This approach will take decades, which will eventually tire you out. The Fastlane approach is to spend the first few years designing a system such as a pulley to carry the stones. In the beginning, you spend time building the system and Slowlaners who don’t understand may laugh at you. Once the system is up, your initial effort will pay and you can complete building the pyramid in a much faster, easier and automatic manner.
There is no need for you to work for 40 or 50 years to earn a million. You can leverage the Fastlane strategy, spend the first few years building the system, and then earn millions after that.
Become a Producer
Since the day you were born, you were conditioned to be a consumer. You will act, do and be like a consumer. You want products, need products, buy products, and of course, seek out the cheapest of those products. However, if you want to play the Fastlane game, you must be a producer and think like a producer.
Instead of buying products on TV, sell the products. Instead of digging for gold, sell the shovels. Instead of taking classes or pay for a seminar, be the one who conducts and sell the seminar. Instead of looking for a job, be an employer and hire for jobs. Instead of taking a mortgage, hold a mortgage. When you switch your thinking and role from a consumer to a producer, you will join the Fastlane to create wealth quickly.
Divorce Wealth from Time
MJ suggests readers build money trees, which are business systems that survive on their own. Money trees require periodic support and nurturing, but they are able to survive on their own, which are able to create a surrogate for your time-for-money trade. Here are some examples of money trees:
1. Rentals – You can rent out real estate, your patents, licenses, etc.
2. Software – If you put up a software for sale online, you leverage the internet and make it available all across the world, for 24/7.
3. Content – Authoring books, magazines, blogs, audio, video, and more.
4. Distribution system – This includes franchising, network marketing, television marketing, and much more.
When it comes to compound interest, the Slowlaners use it to get wealthy while the Fastlaners use it to create and maintain their wealth. For example, a Slowlaner starts with $5 and waits for it to compound to millions. On the hand, the Fastlaner starts with millions and uses interest as a source of income and not as a source of growth.
MJ also explains that to make millions, you must serve millions in scale or a few in magnitude. The Law of Effection states that the more lives you affect, both in scale and magnitude, the more money you can make.
PART 6: Your Vehicle to Wealth: YOU
You must learn to earn your vehicle first before you can make millions. And that vehicle is you. The term, “Pay yourself first” is fundamentally impossible to achieve in a job, so start a corporation that formally divorces you from the act of a business.
The best business structures are the S corp or an LLC. This is because they offer limited liability and tax efficiency. At the same time, try to avoid partnerships and sole proprietorships because these structures do not limit liabilities.
The choices you make will ultimately determine your life. Poor choices are the leading cause of poverty. And choices you make early on in life when you are young have the biggest impact. If you change course at the beginning of a 10,000-mile trip, it makes a huge difference. If you make the change in the last 10 miles, you will highly end up in about the same place.
According to MJ, choice is the most powerful control you can have in your life. Sadly, most people make the wrong choice by following the path of the Slowlane or the Sidewalk. So make choices that will move you into the Fastlane by first changing how you think, and then how you do things. When you master your choices, you can make better use of your time.
He continues to write that there are two good techniques for making choices, first is the Worst Case Analysis (WCA), and the next one is the Weighted Average Decision Matrix (WADM).
Using WCA is easy and straightforward, you just need to ask these three questions below to come to a conclusion:
- What is the worst case?
- How likely is it going to happen?
- Is this an acceptable risk?
As for the WADM, you will need to figure out the factors that matter to you, give each of them a weight, rate on your choices on each factor, and then multiple the ratings by the weights you assigned them to get the score for each choice. You then make your decision according to the highest total score that you get for that certain choice.
When you have debts, they will force you to work harder and longer. MJ calls debts as parasitic because your mortgages, car payment, credit card bills, etc., limit your choices. When you are making a big purchase, think about its time cost. Is that $50k BMW worth 1 year of your life?
And the key to controlling your parasitic debts is to control instant gratification. It is easier to avoid debt if you don’t buy useless things, just like it is easier to avoid eating chocolate cookies if you don’t bring them home in the first place.
Next, MJ writes, “Show me someone who spends hours online playing Mafia Wars or Farmville, and I’ll show you someone who probably isn’t very successful. When life sucks, escapes are sought. I don’t need television because I invested my time into a real life worth living, not a fictitious escape that airs every Tuesday night at 8 p.m.”
Do understand that the distinction where Fastlaners are frugal with time while Slowlaners are frugal with money.
PART 7: The Roads to Wealth
In this part, MJ writes about the Fastlane business that satisfies the Five Fastlane Commandments. And they are:
1. The Commandment of Need
Never start a business just because you want to earn more money. Nobody will care about a business whose sole purpose is to let its owner get rich. Instead, choose to start a business because you want to satisfy a need and to solve a problem. While it is true that you need to do what you love, but people will not pay for your passion, they will for your solution. Thus, your passion must solve a problem.
2. The Commandment of Entry
The harder it is to enter your business, the better your business will be. If you violate this commandment, you must be extremely exceptional at what you do. For example, when blogs were new many years ago, becoming a full-time blogger to earn a living is a great choice. Today, blogs are everywhere and it is so easy to start a blog. It may not be a good business model unless you can become exceptional at it. When it is easy to enter your business, everyone can do it, but everyone is not wealthy.
3. The Commandment of Control
The Fastlane business will give you full control. For instance, you want to sell franchises, not buy them; offer affiliate programs, not use them; accept rent and royalties, not pay them; and so on. If someone can make the decision and make a change to ruin your business, you are not in the Fastlane business.
4. The Commandment of Scale
There are a few levels of scale in a business: community, city, state, region, national, and international. The larger your business can scale, the more you can earn. If there is a limit to how much you can scale, your business may not be able to go very far. Whenever you want to enter into a business, ask if it is possible to scale and reach millions of customers.
5. The Commandment of Time
Finally, a real Fastlane business must be able to automate. Ask yourself if you can get the business running without spending much of your own time and effort on it. Earning a lot of money and having the time to enjoy it requires a business that can be automated.
Here are some specific Fastlane businesses that you can consider venturing into:
1. The Internet
Internet-based businesses can be scaled and automated easily such as lead generation, social networks, advertising, e-commerce, subscription and content-based online businesses.
Create and invent a product and then manufacture and distribute it. Most people think that invention requires a lot of creativity and new products, but this is not always true. In fact, most of the successful products are products with improvements. They are not new, but they are better products that created to serve the market in a better sense.
Although the invention is important, it is the distribution that makes you money. Hence, learn to master the distribution skill if this is what you do.
Iteration actually violates the Commandment of Scale. Take buying franchise and renting out real estate as examples, you are limiting your scaling ability because of geography and location constraint. Unless you buy a second franchise or real estate to rent out, your income will be limited.
In business, it is not about your competition, your objective should be to do it better than others and to improve your products or services. It is not about inventing the breakthroughs, but about closing the performance gaps and solving the inconveniences.
And one great way to observe opportunity is when people are complaining or you find the inefficiencies in a product or service. Even if someone else is already exploiting the ideas and already doing it, don’t worry about the competition and just focus on doing better than them.
PART 8: Your Speed: Accelerate Wealth
In the last section of this book, MJ goes on to explain why speed is the transformation of ideas and how execution can bring you into the Fastlane. Human beings love events and tend to process. This is why most people have great ideas, but they are not successful. Ideas are events, execution is the process.
And he suggests not approaching your business from only one angle. For example, you just want to compete on price. This is not going to work in the long-term. Build a multi-dimensional business where you can raise prices, lower costs, sell more to existing customers, and create new distribution channels, and so on.
Make Your Customers Your Boss
MJ says that he always tells his employees, “The customer pays your paycheck, not me – keep them happy.” He says in the business world, while you don’t have a boss, the person who pays and give you the money is your customer and they always should be heard. Thus, explode your business by developing an excellent customer service strategy that exceeds expectations.
“Success in business comes from making your customer the boss and the No. 1 stakeholder to your business,” writes MJ. And he goes on to say that whenever you discover that the customer service of a business is lousy, you have found a business opportunity.
Build Brands, Not Businesses
When you are in business, you will somehow run into competition. And MJ writes that the best way to win the competition is to build a brand that people trust, admire and love. Businesses have identity crises, but brands do not. And the identity crises will force you as the business owner to go into a price war.
MJ tells an interesting story about branding in the book:
“Cleaning his basement, a man found an old dresser and decided to give it away. He moved the dresser to the street corner and placed a sign on it: FREE. Shockingly, the dresser stood there all day, and for several days thereafter. This confused the man because the dresser, albeit old, was in decent shape and just needed a quick wood stain for perfection. The man decided a new strategy was warranted. He went to the street corner and replaced the “FREE” sign with “$50.” Not an hour later, the dresser was stolen.”
As you can see, it is not a matter of price that determines if a business will survive or thrive, but the marketing and branding of the business that matter.
A scattered focus leads to scattered results. Having ten businesses earning $10,000 cumulatively are not better than one business that does it singlehandedly. When you split yourself too thin, expect to receive little or no results.
MJ gives the advice by saying one should choose monogamy over polygamy. Do not scatter your focus and hop from businesses to businesses. Instead, choose to pay all your attention to one Fastlane business and be 100% committed to it.
And finally, MJ summarizes the top and important criteria of building a Fastlane business in the last chapter. He emphasizes that the “get rich slow” mentality is flawed and you should focus on the Fastlane and “get rich quick”.
And remember the five commandments when it comes to building a Fastlane business. Besides that, switch from a consumer thinking to a producer thinking. Once you get your Fastlane business ready, build brands and learn to market it effectively, and focus on your business until you succeed.