Ryan Loehr
5 November 2025
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Introduction – The Pinball Machine That Built a Billionaire
In 1945, a 15-year-old boy living in Omaha, Nebraska, used $25 of his own savings to buy a second-hand pinball machine. He placed it in a nearby barber shop. It was a small gamble – just one machine, one shop. But the next week, with the money it earned, he bought another. And then another.
Within months, the boy and his friend had a small but growing arcade network generating real cash. Eventually, they sold the business for $1,200 – a fortune at the time for a teenager. That boy was Warren Buffett. And while this early venture wasn’t what made him a billionaire, it taught him something far more valuable than any stock chart ever could:
How to turn initiative into income
The Challenge – “Where Should I Invest My Savings?” Is the Wrong First Question
Every few weeks, a young person – maybe a university student, a recent grad, or the child of a client – sits across from me and asks some version of the same question:
“I’ve saved a few thousand dollars. What should I invest in to build wealth?”
It’s a fair question. It shows initiative. And with social media glorifying stock picks, crypto coins, and passive-income influencers, it’s easy to assume that the fastest path to wealth is through a brokerage account.
But here’s the hard truth I usually share, gently: If you only rely on investing your savings, it will take decades to create meaningful wealth.
Let’s do the maths. If you diligently invest $500 a month and earn 10% per annum (a solid, long-term market return), after 10 years, you’ll have about $100,000. That’s great – but hardly transformational.
Now compare that to someone who starts a side hustle, earns $500 – 1,000 a week in profit, and reinvests that into growing a real business. Within a few years, that business might generate tens – or hundreds – of thousands annually.
The difference? Ownership.
A Better Framework – Shift From “Saver” to “Builder”
So, if long-term stock investing isn’t the silver bullet, what is?
Wealth, especially in your early years, is best built through four sequential stages:
- Skills: Becoming good at something the world values
- Service: Turning those skills into income by solving problems for others
- Scale: Turning that service into a repeatable, structured business
- Smart Capital: Reinvesting profits into scalable, enduring assets
Let’s explore each one.
1. Skills: Learn to Do Something Valuable
Before you earn, you must learn. Every young person should ask:
"What can I do that solves a problem for someone else?"
Skills don’t have to be technical or academic. They just need to be useful.
Can you:
- Design logos, websites or resumes?
- Make short videos for small businesses?
- Fix things? Build things? Paint things?
- Tutor high school students?
- Organise homes or digital files?
- Write engaging content for social media?
Your first job isn’t to invest capital. It’s to invest in yourself – and become the kind of person others trust to solve something they care about.
Real examples:
- A 17-year-old I know began taking photos for real estate agents on weekends. Today, he runs a media business earning six figures annually.
- A university student started tutoring HSC Maths online. She now employs four other tutors and generates more than $3,000 a week in margin.
Skills are the raw material of wealth. Without them, capital doesn’t compound. With them, you can start anything.
2. Service: Offer That Skill to Others – and Get Paid
Once you have a skill, the next step is monetisation. But don’t wait for perfection. Don’t build a fancy website. Just ask this:
"Who do I know that might need what I can offer?"
This is where most young people freeze. They wait for permission or fear rejection. But the truth is, the greatest wealth builders are those who offer something simple – clearly, consistently, and with pride.
Examples:
- Warren Buffett’s pinball machines were just old entertainment re-packaged with hustle.
- Melanie Perkins, co-founder of Canva, started by teaching design to other students and then built custom software for yearbooks.
- Janine Allis started Boost Juice by noticing a gap for fresh smoothies while travelling – and began blending in a small Adelaide kiosk.
None of them began with a perfect plan. They began by offering a simple service that people paid for.
Key insight: Most wealth doesn’t begin with invention – it begins with execution.
3. Scale: Build the Structure to Grow Beyond You
The step from earning to building comes when you turn a job into a system.
That means:
- Hiring others
- Creating repeatable processes
- Serving more people, without working more hours
This is where real wealth is made – not through saving harder, but by building smarter.
A car wash business with one person earns $500 a week. A mobile team with a booking system, three workers, and branded vans can earn $5,000 – $10,000 a week.
A tutoring business that started with one subject can evolve into a micro-agency, servicing schools or parents with 10+ tutors.
This stage requires:
- Business systems (e.g. online booking, CRM, invoicing)
- Pricing strategies (moving from hourly to value-based)
- Understanding basic legal and tax rules (trusts, GST, contracts)
And above all: mindset. You are no longer just an individual earning money. You are now the architect of a value-creating machine.
4. Smart Capital: Reinvest With Purpose
Now – now – you’re ready to invest. But instead of investing from scarcity (saving $300 and hoping for 10% return), you’re investing from abundance.
This might mean:
- Reinvesting into your business (ads, staff, infrastructure)
- Diversifying into property or markets as profits grow
- Retaining earnings inside the right structure (e.g. trust or company)
- Funding education, training, or IP that improves your advantage
The key is that your capital is now doing the heavy lifting because you’ve already built a productive engine.
This flips the entire script.
You’re not dependent on market returns to get ahead. You create returns – through your business, through leverage, and through ownership.
But What If I’m Not “Entrepreneurial”?
This is a common concern. Not everyone is wired to start a business – and that’s okay.
But this article isn’t just about starting the next Canva or Atlassian. It’s about learning to think like an owner, even in small ways.
You can:
- Start a side project while working full-time
- Monetise a hobby with a simple payment link
- Offer services during uni holidays
- Build a profile on LinkedIn or Fiverr and test demand
You don’t have to risk everything. You just have to start something.
The truth is, the people who build wealth – real wealth – aren’t necessarily the smartest.
They’re the ones who take initiative, solve real problems, and reinvest wisely.
Wealth Is Built When You Back Yourself
If you’re young and wondering where to put your savings, my honest advice is this: Don’t ask where to invest your money until you’ve figured out how to create more of it.
In the long run, the most valuable asset class isn’t equities, crypto, or real estate.
It’s you – your creativity, your ability to solve problems, and your willingness to back yourself when it matters.
Warren Buffett didn’t become a billionaire because he picked the right stock at 15. He became one because he learned how to think like an owner – and kept building from there.
So start small. Start now. And start with what you can offer, not what you can buy.
That’s where real wealth begins.
