What Monopoly Taught Me About Building Wealth

Why everyone should be playing monopoly

Monopoly is a game that most people associate with the holiday season. It’s a Christmas classic—a must-play with snacks and drinks after the main meal, as things get hectic around the board.

But have you ever thought about who invented Monopoly and why? You probably haven’t, and neither did I until recently, but it’s actually really interesting.

The origins of Monopoly trace back to Elizabeth Magie in 1903, who created 'The Landlord’s Game' to demonstrate the dangers of land monopolies and the concentration of wealth. It was designed to show how monopolies could lead to vast inequalities in wealth and how, under the existing economic system, the rich would get richer while the poor remained trapped in a cycle of poverty.

Then Charles Darrow came along during the Great Depression, commercialised the game, and shifted its focus to accumulating wealth as the path to winning, moving away from social critique and towards capitalistic principles. When I first started playing Monopoly, I never actually considered the lessons I was learning, but now, in hindsight and as a property owner myself, there are some important takeaways.

No Ownership, You Lose: In the end, the winners of the game are the asset owners. If someone in the game has a lot of cash but no property, they’ll eventually lose it all to the asset owners because asset owners make money without doing anything. Wealth accumulates easily—I’ve written a blog post about this here.

Start Early Where You Can: If you save all your money and waste time trying to buy a property in the blue or green areas as your first, you’ll probably lose a lot of money to those who own physical assets before you get there—especially if luck doesn’t play into your favour. Most players will need to start with properties in cheaper areas first. The resonates in real life to, I’d always encourage people living and working in London, to purchase an investment property further up north first. You can purchase your first investment property in London, but finding 25% for a deposit on a London property will undoubtedly take much longer.

Nonetheless, Location Is Still Important: A player who ends up with one hotel in the a good location is likely to end up in a better position than a player with multiple houses in less desirable areas. What makes a good location depends on multiple factors and also on what strategy you’re taking with your property investment. These factors will also affect your exit strategy when it’s time to sell.

Cash Is King: You always need cash. I also spoke about the importance of liquidity in a recent newsletter. Property is a highly illiquid asset—it takes months to sell on average. In the game, if you run out of cash, you can just sell a property and get the cash instantly, but in real life, it’s not that easy. Even the best businesses, investors, and individuals will run into issues if they don’t have cash. Hence why it’s so important to have liquid assets.

Strategy: Lastly, let’s talk about strategy. Luck definitely plays a role in your success in Monopoly, as well as in real life, but you can’t rely on random luck. Having a strategy is something you can control, and it makes a whole lot of difference. That’s why my course subtitle is ‘How to Strategise Your Way to Financial Independence.’ Without a strategy, your likelihood of winning isn’t very high.

In summary, one of the main takeaways from the game is that you need to own assets. I’ve said this many times before, but it rings true every time. You might see Monopoly as just a fun game to play, but it’s literally showing you how a capitalistic society works and why some win and some don’t. Inspired by this, I’ll be opening up the 'Building Wealth with Lamide' WhatsApp group chats, where property opportunities get shared, and you can get into investments with as little as £15k saved for those who join the First-Time Buyer’s Webinar course from here on out: [Join here].

📹 Broke & Starting Over at 39

If you’re struggling with your spending, or is someone who at the end of the year constantly have no money left over please watch this ladies story. She speaks on a part of personal finance that I don’t think is discussed as much which how our self-esteem and possible disorders effect how we spend

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