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Be an Owner, Not a Consumer, to Achieve Financial Freedom

wallet tape measure

This week’s Saturday selection comes from WCI Network member Passive Income MD. He has recognized that a change in mindset and habits can make financial freedom much more likely.

This post was originally published on Passive Income MD.



Be an Owner, Not a Consumer, to Achieve Financial Freedom


Recently I read a book on finances and entrepreneurship, The Millionaire Fastlane by DJ DeMarco, and the author gave an excellent piece of advice. He said, “Be an owner, not a consumer.”

Already, I’m sure you have some ideas in your mind what that might mean. The phrase sounded like good, solid advice, especially in a book on finances.

The author mentioned this phrase within the context of achieving financial freedom, and went on to write that the only way to do this is through a shift of the mindset.




The average mindset in this country has shifted to being a consumer instead of an owner. Most people (even subconsciously) seem to believe that wealth is built by possessing more things. This is the consumer mindset pushed by nearly every media outlet and advertisement out there. It’s virtually inescapable. However, the true path to wealth (and “wealth” takes many forms) doesn’t usually take that direction.

To illustrate my point, here are several ways that being an owner differs from being a consumer.

Owners vs. Consumers




Traditional advice says that you should be smarter about your purchases, and I wholeheartedly agree. Some people, though, take that to mean that you should never buy a nice car or nice clothes. I don’t particularly agree.

I believe that it’s your mindset that makes all the difference. If you look at a seemingly extravagant purchase through the eyes of an owner, you’ll see a long-term investment. On the other hand, a consumer sees short-term gain, trendiness, and disposability.

A great example of this comes from two of my colleagues, both of whom own Porsche 911s. One leases his and upgrades to the new version every three years. He talks quite a bit about how expensive his monthly payments are and he picks up extra shifts to help pay for his expenses, and in particular, for his car.

The other has had his Porsche for over 15 years, and he paid for in cash. He takes care of it, exchanges parts out that need repair, and takes it out to the track. He truly enjoys the car, and it shows. He talks about it like it’s his baby, and in a way, it probably is. He’s not too extravagant otherwise and has set himself up very well financially. How could anyone fault him for that purchase?




Every time you use an app on your phone, go to a restaurant, or watch / observe any sort of advertising, you’re a consumer. Someone out there is always benefiting from your behavior. But imagine, if you will, that the tables were turned, and you were the one who benefitted from consumer behavior. What would that look like?

From a business standpoint, the shift from consumer to owner is simple. If you have a passion, why not consider building a business around it?

The perfect example of this is George Clooney and his Tequila brand, Casamigos. He and his friend Randy Gerber found themselves in Mexico frequently, and they both shared a love of tequila. And so, in 2013, they decided to start their own brand. Just four years later, they sold Casamigos for $1 billion.

A consumer may have been content to amass a collection of exotic tequila to impress their friends. But as owners, Clooney and Gerber not only get to consume as much tequila as they want, but they also benefit from having other consumers buy and enjoy their drink.

Of course, not all of us have the fortune or time to simply start a major brand. However, on a small scale, there are many physicians doing the exact same thing – starting businesses around their own passions.


Real Estate


Here’s what real estate looks like to the average consumer. They want to live in the nicest, trendiest locations and will pay a large amount of rent to live there. They don’t often consider the long-term potential or the growth of the asset. That’s why rental units (whether apartments or houses) just don’t get the same level of upkeep as an owned home.

Real estate owners, on the other hand, exhibit a certain pride that comes across loud and clear. Whether you’re a landlord or simply own your own home, ownership leads to improvement. You might change fixtures to match your tastes. You might repaint. You care about the landscaping. As an owner, you’re able to benefit from tax breaks and market appreciation.

Owners of real estate investment properties even do better as they make money through tax benefits, monthly cash flow, and they also benefit from having someone else pay off that asset while it (hopefully) appreciates.



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wallet tape measureTo a consumer, debt is an instrument of immediate gratification. Why wait until you have the money to buy something when you can have it now with a simple swipe? And thus begins the trip down the slippery slope of credit card debt. This is, unfortunately, the situation for many Americans. In the year 2017, CNBC states that the average US household owes $8,377 in credit card debt.

However, if you see debt as a tool to gain more assets, which ultimately creates passive income, then you have successfully become an owner. To the owner, using debt and leverage wisely can lead to wealth and financial freedom.


Net Worth


Owners tend to find themselves in the position of growing their net worth. They focus on adding assets and savings. Real estate, investments, and other ventures steadily add to the owner’s net worth. Owners will set net worth goals and track their progress using something like Empower.

Unfortunately, consumers find their net worth being drained by items that they’ll only use for a short time and then discard. Again, the focus on short-term satisfaction can keep them from building and growing any meaningful assets.




In the end, owners find themselves in positions of growing wealth and progressing on the path to financial freedom. Consumers find themselves stagnating at best, regressing at worst.

If your goal is ultimately financial freedom, take some time to focus on that mindset shift. Always look at things with a long-term perspective. Ask yourself how a purchase will benefit you years down the road. To put it simply, make sure that you’re acting as an owner, not a consumer.


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Do you possess an owner mentality or a consumer mentality? How does that manifest for you? 


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22 thoughts on “Be an Owner, Not a Consumer, to Achieve Financial Freedom”

  1. The expression that credit cards are to buy things that people don’t need with money they don’t have to impress people they don’t know certainly rings true. Decision making based on a long time view will be the choice towards prosperity. Pity that our outside world reinforces the opposite of that idea. Think in terms of Benjamin Franklin who left money to Boston and Philadelphia with the stipulation they could not use it for two hundred years: Now that’s the long view.

  2. Subscribe to get more great content like this, an awesome spreadsheet, and more!
  3. Thanks for sharing with us…very inspirational.If we are born poor,it’s not our fault.
    If we die poor,then it’s our fault..So start investing and earning.

  4. I want to be an owner, but truth be told I may have some consumer tendencies……..and I still trade my time for money, the ultimate sin!

  5. I agree that those who accumulate assests build more wealth. One key point is know that an assest is something that generates income when many consumers confuse having something that costs them money (via maintenance or depreciation) as an asset, as you point out.

    The best is to accumulate assests that give you pleasure at the same time. However, we may exchange less income generation for increased pleasure if it at least holds its value. I think of our personal home this way. We have extra acreage which we don’t “need”, but it will at least hold its value relative to inflation, requires minimal maintenance, and gives us huge pleasure doing things that we otherwise could not do in the area where we live. There is opportunity cost with some of our money tied up in it, but worth it to us. I also think that we are all consumers to some degree and it is the order in which you spend that helps separate the “consumers” from the owners – owners build the money generating assests first and then enjoy the rewards of that extra cashflow, recognizing it as consumption and savouring it.

  6. If you own stock or bonds you are an owner. If you plugged that $40 a week tax cut into VTI for 40 years you would own $345,000 of a broad base of American business. You would experience the ups and downs of ownership. You would experience the enjoyment of making something grow. 76% of the 345k would be from interest only 24% from principal, all from 40 bux a week. Money can buy you a Porsche but ownership buys you security.

  7. I think a more fair comparison is Owners vs. Renters. We are all consumers whether we like it or not. Yes, owners are consumers too.

    Owners are more successful than renters. There’s a huge difference in the “owner” mentality and the “renter” mentality. Owners take on responsibility while renters generally do not. Owners look at things with long term value and gain while renters are primarily concerned with short term benefit. Thus owners are willing to endure delayed gratification for a better future while renters are thinking about instant gratification. Owners tend to see the whole picture while renters are many times focused on themselves. Owners are generally more financially responsible while renters tend to get into debt easily. I can go on.

    Back to my other point. We are all consumers. However, we have the power to consume what we want. And that should not be taken lightly. People with an “owner” mentality generally make better choices on what they consume. They “own up” to these decisions.

    Since we are all consumers, I think it is very important for people to adapt an “owner mentality” and practice conscious consumerism. It’s all about being mindful of what you want to consume, being intentional with how you spend, and valuing everything you own/posses/purchase.

    [Directed to PoF] Just like with a fine craft beer…. please consume responsibly 😉

  8. Owning is good but as you said, you have to have some capital to get into it. Otherwise you are stuck in the consumer loop endlessly.

  9. Excellent post, I feel that many people fall trap to consumer debt. In my mind, it shouldn’t exist! But of course, business are built to make profits and that is what credit card companies have ensured by making it easy to buy now and pay later. The swipe of plastic is too easy for the undisciplined.

  10. The allure is certainly there. Becoming an owner instead of a consumer provides a lot of freedom.

    Your numbers on the average amount of credit card debt for Americans is crazy. I know it’s true, though, as people like my brother in law view it as an option to buy things he cannot afford. He is the definition of a consumer.

    I wonder what prompts most of us who have made the transition from a consumer mentality to a owner mentality. A book maybe? A website? Friends or family?

    I have a post coming up in the next month that talks about the responsibility that we all have to share this path with others. Itd our responsibility to teach even if many of them don’t want to or wont listen.

    • I bet the people who have a high balance on their card each month, but also pay it off monthly, raise the average a bit. Maybe more than a bit, I don’t know.

      • That’s a good point. I certainly do this on gas and groceries to get the money back. Wonder if this number is for continued debt or for a monthly balance.

        • I think what prompts the transition is a feeling of contenment. Once that occurs, the “feeling” begins to evolve into a more permanent “state.”

        • I think that is exactly right. It’s like working out. When you first start, the lactic acid build up makes moving terrible… Not a fun experience.

          The more you exercise, though, the more stamina you build up and the easier it gets.

          I think contentment is the same way…. Or I could just be coming up with this analogy because I am about to start my workout! 🙂

  11. I have been in the consumer mindset as a new attending. After seeing my paychecks dwindle because I could afford things monthly, I woke up, started reading and became an owner (and rapidly FI : )

    I agree with you that consumerism is the new ownership. Other than mortgages (which aren’t that new in the US), our generation has turned the tables. Shame.

    One side note would be that owning possessions don’t give happiness, unless they are an avenue to something more gratifying. I think you make a great point about the 2 docs with a Porsche. One sees it at a trendy item, and therefore his joy for that car will diminish in accordance with hedonic adaptation. However, the other sees the car as a tool to gain experiences such as working on it, driving, racing, perhaps talking about it with other car enthusiasts.

    The second doc is much less likely to hedonically adapt to the car because he derives dynamic experiential benefit, which is a leading technique to combat adaptation. This analogy can be applied to many possessions, like a house that raises a family, a boat that allows those river trips, a brewery that allows meeting with friends.

    Personally, I love shinning my Allen Edmond shoes. They look great, are comfortable and never wear out with proper care. I also enjoy talking to my shoe loving friends (yes, we exist). To me, they embody my commitment to value and frugality without cheapness and remind me of the hard work it took to become a doc and save a $h!t ton of money when young. Yeah, they are $400 on sale, but at least I wait for a sale.

      • That’s cool that they were your dads shoes. Probably a pleasant memory for your brother when he wears them.

        They last a while. Can get them resoled and refinished for $90. It’s needed about every 5 years.

  12. During one of the political races in the not so distant past, I remember one of the candidates comment on the poor that they need to, “buy more income.” This is such a simple concept, but so terribly difficult to get started on. In the early days of wealth building, buying income resulted in a very small trickle of income. I understand the instant gratification of using your hard earned funds for something you want versus and income that might buy you a cup of coffee every quarter.

    I think it is wise to find a business to start that doesn’t require much start up capital when starting out.

    • Lots of businesses don’t require much start up capital. I’m in the underware business, the telecommunications business, the insurance business, the computer business and the drug business. My start-up capital for each was under $200 (some as low as $30) and not only do they pay me profits regularly, they value of the business increases regularly as well.

      One thing the internet has done has been to reduce the cost of investing in stock. You can now pay no commission via brokers like Robinhood.

  13. Interesting view POF. The problem with definitions, however, is they tend to devolve into semantics. I know many consumers in my own family who think of themselves as “owners”, as in they own those very things they consume. What the author means, of course, is owning assets that either produce steady income or appreciate in value with time. By this definition, few become owners and that’s precisely why they are financially independent because every owner needs hundreds if not thousands or millions of consumers who are willing to pay for the very things that the owner produces!


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