Here’s How You Can Be Rich by Thinking Like the Rich!
If you have ever wondered what it is that sets the rich apart from the poor, the rich must have a different mindset than the middle or lower class. You have the opportunity to capitalize on whatever your resources are, but you just need the mindset to do it! The rich are not another breed, more deserving or different from the regular Joe. There are no secrets to join their ranks, and you don’t need an inheritance or win the lottery to get there. It boils down to motivation and financial planning. Here’s how the rich think and how you should be thinking.
Make Your Money Work For You
We are often raised from a young age to understand that the way of the world is that we need to study hard for a good education, then land a good job, and work hard for our money which we have to save by living frugally so that we can afford retirement. However, there are many flaws in this traditional method of life, and the rich are those who have discovered that it doesn’t work. Building wealth is about making your money work for you, not about working for your money.
Earning a salary isn’t the best way of building wealth. Passive income is the key to building wealth. Passive income takes many forms – rentals, royalties, investments, and many others. You don’t necessarily need a lot of money to begin, but you have to be smart with how you operate your funds.
Don’t Keep Up Appearances
Perhaps because of the crazy purchases and ridiculous mansions of big celebrities in the media, we are all led to believe that the rich all lead lavish lifestyles. This has led to the middle class winding themselves up to their ears in debt, simply trying to appear rich. Yes, some rich live lavishly and spend recklessly, but many are living frugally and investing large fractions of their funds to build wealth. Take Jeff Bezos as a prime example – Bezos is the richest man in the world, but even after becoming a billionaire, he drove his humble old Honda Accord. Debt hampers your future finances. Keeping up appearances will only run you into debt, especially if you are purchasing our of your means (on credit, of course).
Time Is Money
Compound interest can be your friend, or it can be your enemy. However you see it, there’s a magic about it for one end of the spectrum. In the world of investing, compound interest has made the time a valuable currency because the funds you invest today are significantly more valuable than the funds you invest tomorrow, metaphorically speaking.
If you start to invest today — no matter how small — and continue to do so in the next several years, these small pools of money can make a world of difference. So get down to investing and reap the benefits in the many years to come. Automate your contributions so that you needn’t have to worry about remembering to do the transfers or deposits.
While you may be under the impression that the wealthy are those who know much about investing, finances and trading, and other mind-boggling concepts, the truth is that they value the worth of expert advice. The average Joe would scrunch up their nose in hesitation at the prospect of hiring a professional to manage their bank accounts or their investment portfolio, but all the while not realizing that the help of a professional is what could grow their lath beyond what they could save on hiring that professional. It is crucial to select the fee-only breed of advisors when it comes to your finances. This way you know that your advisor’s suggestions are not focused on the commissions they make from the sale, but rather on how well your portfolio performs.
It won’t get you anywhere to believe that wealth will come to you overnight, but with proper care and responsibility for your finances, you have a lot of potential to be one of the small fraction of the rich in the world. The key is slow and steady growth and acquiring help when you need it from the right kind of people. Having a big bank account isn’t about hard work – it’s about being smart with your money. Break tradition and become rich!
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