Blog | Entrepreneurship, Personal Finance

Rich Dad Scam #3: “Work Hard"

Why working hard and hustling won’t make you rich

People often talk about a scam as a con. Con is short for confidence. A con man can only dupe you if you put your confidence in him. When I talk about Rich Dad Scams, the scams designed by the rich to keep you poor, one of the hardest things to get past is that so many of us have been taught to believe with conviction and confidence that these scams are true. And the conning started so young that we never had a chance to think differently.

This post is about one of the biggest, most-ingrained Rich Dad Scams: If you work hard, you will be rewarded.

“Rise and grind” and other hustle mantras

If you’re even remotely interested in entrepreneurship, you’ve probably run into hustle culture. In short, hustle culture is the idea that if you put in enough hours and push yourself to the brink, you’ll be successful.

As “The New York Times” writer Erin Griffith puts it, “[Hustle culture] is obsessed with striving, relentlessly positive, devoid of humor, and — once you notice it — impossible to escape. “Rise and Grind” is both the theme of a Nike ad campaign and the title of a book by a “Shark Tank” shark. New media upstarts like the Hustle, which produces a popular business newsletter and conference series, and One37pm, a content company created by the patron saint of hustling, Gary Vaynerchuk, glorify ambition not as a means to an end, but as a lifestyle.”

Hustle future is nothing new, and neither are mantras like, “Rise and grind.” When I was a young boy, the common refrain was that if you worked hard you would be successful. Just like the other Rich Dad Scams like I’ve written about, “Go to a good school,” and “Get a good job,” the idea that working hard can make you successful is a lie. Hustle culture is just another slick package for an old idea…and one that many people are profiting from shilling online and in books.

Skip the rise and grind

My poor dad, my natural father, worked hard all his life. He went to school because he was told to. He got a job because he was taught that was what you have to do. He worked hard because that was what he was supposed to do. Yet, he struggled financially his whole life, and often he was not happy.

When it came to working hard, my rich dad, my best friend’s dad, liked a story from Mark Twain’s “The Adventures of Tom Sawyer.” Tom runs a sales job on the kids in his neighborhood. His job is to paint a fence, and he makes it look like so much fun that all the other kids offer to pay him to do the work.

Rich dad said, “Rather than work hard, I work smart. Smart work is getting others to not only do but also want to do hard work for you. And smart work is also getting money to work for you, not the other way around.”

My rich dad would have laughed at an idea like “rise and grind.” He would have said that was for fools. He knew the secrete that rich people know. Working hard actually keeps you poor.

Why hard work doesn’t work

It seems like a simple math equation: effort=reward. You work hard, you earn more, you get more for your effort, and it seems like it should work. Once upon a time, it may have worked that way.

But now, there are a few problems. One, as I wrote about in Rich Dad Scam #2, “Get a good job”, if you’re an employee, working harder may get you more money but it also means you’ll be taxed more. So, working harder can actually result in you being punished financially. That’s why we created the Rich Dad Scams series, so that you can see them for the lies they are.

The second problem is that you’re working hard for something in particular: Money. And that money is worth less and less every day.

During the 21st century, average income after inflation has fallen. And continues to fall. If you’ve been working hard at your job for ten years, the money you’re making now is actually worth less than it was when you earned it. Practically speaking, that probably means you’re either making the same amount now as a few years ago, or maybe even making less! Rather than work hard for money, you should be working smart by having money work hard for you. That is what the rich do.

Finally, science has proven that working long and back-breaking hours doesn’t increase your productivity. In fact, it may make you less effective at what you do. As Sarah Green Carmichael says writing for “Harvard Business Review” lists many of the drawbacks of overworking that have been proven by science: lack of sleep, lower output, depression, memory impairment, heart disease, diabetes, heavy drinking, inability to have a high emotional intelligence, and more. As she writes, “In sum, the story of overwork is literally a story of diminishing returns: keep overworking, and you’ll progressively work more stupidly on tasks that are increasingly meaningless.”

Work smarter, not harder

Every week most people just hold on until Friday because they hate their job. And when Sunday rolls around, they’re miserable because they know they have five days of work to look forward to.

It’s a lousy way to live, but it’s not the only way. We’ve just been trained to think it’s the only way.

My rich dad taught me that truly rich people work smarter, not harder. Entrepreneurs are successful because they get other people do work hard for them, not because they themselves work hard. Some of the most successful people I know work less than forty hours a week. They find lots of time to relax, hand out with family and friends, and just generally enjoy life. In the meantime, their companies and employees are also working for them and making them money, just like Tom Sawyer.

I love my work. It’s more like a game that I love to play. It’s challenging. It’s fun. It’s rewarding. But I don’t spend every moment of my day doing it. Nor did I when I was just trying to get my business off the ground. Were there some times I put in long hours? Sure. But I didn’t deceive myself that those long hours where what made me successful. What made me successful was hiring great people and having them work hard for me. Once I did that, my wealth grew exponentially, and my free time did too. If that sounds attractive to you, the first step to get there is recognizing “work hard” for the Rich Dad Scam that it is. Stop working hard for others and start working smart for yourself.