Dubai Taught Me You Can Be Wealthy or Poor. There’s No In-Between
Investors vs low-skilled workers
I felt like a fool last week. I thought anyone could make money in a rich country.
Dubai showed me there’s desperation behind the rich facade you see from the car window.
Let me explain.
Everyone’s rich? Not so fast
You leave the airport and see the city in all its opulence.
Dubai stretches 72 km along the coastline. You drive for half an hour at 100 km/h along fresh real estate and sports cars.
You think everyone’s well-off in Dubai. Maybe one day you’ll find a job here too. Add a zero to your net worth.
Buy five properties. Rent them out. Stop working. Light cigars with dollar bills. Pay cash for a Bentley.
Move your family here. Drink morning coffee in an air-conditioned high-rise penthouse with a view of the Persian Gulf. Congratulate yourself on having made it.
And then you talk to the taxi driver. The taximeter says his name is Ali. He moved to Dubai a year ago from Pakistan.
There’s no work in his home country. Ali needs money quickly. His wife back home got run over by a motorcycle. She needs metal rods in her right arm for the broken bones to heal. There are no rods in government hospitals.
She must go to a private hospital. That means paying money and waiting for weeks before the rods arrive.
Ali’s wife is a dressmaker. She stopped earning an income. The family is running out of money and food.
They have four kids. The oldest is 12. Ali works twelve hours a day seven days a week. He says he’s 40 but his gray hair and the dark bags below his eyes make him look 60.
“Ali, how are you helping your family?”
“I make $700 a month as a taxi driver. I need to live somewhere and eat something. Then send the rest to Pakistan. Life’s tough, man.”
My jaw dropped. That’s how much low-skilled immigrants make in Dubai.
I didn’t know what else to say. It was a good moment to shut the hell up and thank God I’m not living in Dubai on $700 a month.
Opportunities are there. Go get them
What a city of contrasts. Which side do you want to be on? Big financial centers shove the divide between the wealthy and the poor right into your face.
I’m saying wealthy, not rich. Dubai Sheikh Mohammed bin Rashid Al Maktoum with his $18 billion in investable assets and literally the entire city being his property is rich.
Wealthy isn’t rich, it’s within reach. You just need enough money to live life on your own terms. Look at local financial markets for help.
Dubai’s oil production accounts for less than 1% of its GDP. Sheikh Mohammed shifted the city’s economy away from the finite resource of oil. Dubai is prospering thanks to other industries that contribute significantly to the GDP:
Real estate: 4%
Manufacturing: 7%
Wholesale and retail trade: 23%
Transportation and storage: 13%
Financial services and insurance: 6%
The large figure for financial services shows the importance of capital markets. Dubai has two stock exchanges, one for domestic stocks, one for international stocks.
There are more than a dozen brokers in the city.
There’s no personal income tax.
There’s no capital gains tax.
The city incentivizes investing. Make money on your day job and invest it.
I wish Ali could invest part of his paycheck. But taxi drivers in Dubai don’t buy stocks. They transfer money to their families. I’d do the same if I were in their shoes.
The world is an unfair place. I tipped Ali and other taxi drivers every time so they could buy an extra burger at McDonald’s.
But when you see the divide, you ask yourself what makes the wealthy, wealthy. How about
Being born in a rich country where the Sheikh provides free housing to deserving Emiratis.
Getting naturalized by exceptional merit like Telegram founder Pavel Durov.
Getting a good job in real estate when the sector is exploding.
Getting a mediocre job and living below your means.
You may not be making $100k+ a year. It doesn’t matter. The best advice for building wealth holds:
Spend less than you earn and be smart with the difference.
Every month invest the money you don’t spend. Give it time to grow and buy you financial freedom. Then you’re on the wealthy end in Dubai and pretty much in any developed country.
The financial markets across the world are for you to benefit from. That’s how you take care of your family without having to drive a taxi twelve hours a day.
Dubai makes it clear like nothing else your life is a result of your choices. Get a large family without a stable income and it’s tough. Plan your financial future and you’re on your way to becoming wealthy.
I want you to choose the second option. So you end up like this:
Invest your money.
This article is for informational purposes only. It should not be considered Financial or Legal Advice. Not all information will be accurate. Consult a financial professional before making any major financial decisions.
It's not an easy life for those low skilled immigrants but one praiseworthy thing about them. They are willing to work really hard compared to the locals.
Are you living there?