What is capitalist ?
How to Get Rich: Becoming a Capitalist
So how can you get rich? How can we become wealthy in a capitalist society? As a worker, you might think you can't become rich for the rest of your life. The answer is no. However, the only way to achieve wealth is to become a capitalist.
A capitalist is a person who owns businesses, stocks, or real estate assets—that is, an investor. You don't have to think of it in an exaggerated way. For example, you can become a capitalist by owning just one share of SM, a conglomerate in the Philippines, or by investing in the comprehensive index PSEi, which is the benchmark of the Philippines. By doing so, you can partially own shares of the top 30 companies in the Philippines.
A capitalist is responsible for the amount of money invested and ultimately receives the remaining profit distribution. This means that if you are an SM employee, even if SM makes a substantial profit in a particular year, your basic salary will not increase significantly. There may be a bonus, but it won't be as impactful as being a shareholder.
On the other hand, if SM makes a big profit, the stock price is likely to rise, and shareholders can benefit from the increased value of their holdings. Additionally, dividends may also increase if SM has a profitable year.
As you can see, the compensation is entirely different depending on whether you are an SM employee or a shareholder. But if you only have one SM stock, you might wonder if that alone would make you rich. The answer is no. So, let's discuss how much you should invest to achieve significant wealth.
How Much Money Does a Worker Need to Become Wealthy?
Before considering how much money to invest, it's important to clarify your goals.
Why you need money depends on the person. Some people may vaguely want to get rich, while others have specific goals like funding a business or acquiring certain assets. It's crucial to determine what you want to achieve and how much you need to invest to reach those goals.
In my case, I invest a portion of my monthly income in an investment trust to save for my child's future tuition and retirement funds. One reason for using an investment trust is to diversify investments, which reduces risk compared to investing in a single company's stocks. Another reason is that you can start with a small amount of money—depending on the bank, the minimum investment can be around 1,000 pesos.
I recommend investing in the Philippine benchmark PSEi or the 30 companies that make up the PSEi.
However, many people have limited income and may not be able to allocate funds for investment. Does this mean they can never get rich? I don't think that's the case. Long-term funded investment allows money to grow over time, making it possible to accumulate wealth even with smaller amounts.
Of course, the larger the investment, the greater the potential for growth. That's the appeal of investing. To invest, it's essential to increase income, curb spending, and manage surplus money effectively. By doing so, you can move beyond being a worker and start your journey toward becoming wealthy.
