What Does It Take To Be Filthy Rich?
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Question: What does it take to be filthy rich? With my meager salary, it seems I couldn’t reach that point. I can’t think of being able to save up enough money to be one. – Bart S.
Answer: These days, the day time and prime time game shows on TV are raking in the audience and the advertising support — Who wants to be a Millionaire, Can You Beat a Five Year Old. Wheel of Fortune, etc. Poeple are tickled at the idea of taking a chance at becoming a millionaire in one day.
Lotto and sweepstakes outlets also get long queues especially when there’s an upcoming super lotto draw. Citizens, from the low-income to the middle-income branch of our society, are queuing up in hopes of winning the elusive jackpot.
But the odds of winning in game shows, sweepstakes and lotto draws are very few. As an alternative of dreaming about becoming a millionaire through these schemes, desire to work on becoming very rich yourself. No, Bart, it’s not too far out to achieve that reality
Look around. There may be millionaires you already know living in your area or going to the same workplace as you do. These are the ones who live in their own homes with their own vehicles, whose belongings total more than million dollar. Whether or not they feel like millionaires is up to them. But the central issue is that they have built up an asset base valued at over million. It is an achievable target.
There are the really rich and visible millionaires who are business leaders. When you read their personal stories, you’ll be struck with the truth that some of them were born underprivileged. If they made it from rags to riches, there’s no basis why you can’t try.
To achieve that ambition, you have to gain knowledge of the secrets of rich people. Here they are:
1. Treat your earnings as something to save and invest. The moment you get your salary or a windfall (example, an inheritance or a bonus), think of how much you can put away as nest egg. Then look for venues where you can invest your money. If you think this way, you won’t be tempted to spend money.
Some people splurge their retirement pay on expensive cars. But when they get really sick, they find themselves with not enough cash to pay hospital bills. So save more, rather than spend more.
2. Assume some risk when investing. When you play safe in investing, you’ll get safe profits as well. Rich people have gone out on a limb putting up businesses which they hoped would earn — nothing is assured. But it is in taking calculated risks that they are rewarded.
When investing, look at higher-yielding investments. Sure, they may be more risky than regular ones (such as savings and time deposits), but you may earn more in the long run. Just be wary of get-rich-quick investment schemes. Remember the adage: If it is too good to be true, it is.
3. Live simply. If you keep your cost of living low, you will have more money to save and invest. Some rich people have lived in the same homes they have had for the past 30-40 years. Or they live in the homes they inherited.
You can also take a cue from the way millionaires live: not all party every night, nor do they buy every new car model that’s released. Instead, you’ll find these millionaires working at their desks at 8 a.m. and having just two cars in the garage.
4. Have a goal. Don’t just dream; set financial goals for yourself. By being specific, you will be more motivated to reach your goal. For instance, make it your goal to have your own home by the time you are 35 or 40. It may be a studio condo unit or a three-bedroom home in a subdivision—it will depend on your income and how you save over the years. Having a goal will help you focus your efforts well.
5. Choose good debt over bad debt. Take out a loan only when the loan proceeds will be used to earn you more money. For instance, apply for a bank loan to develop a business that’s reasonable. But to take out a loan to buy assets that depreciate quickly (examples: sports cars, yachts, etc.) may not be wise as these assets will not earn you enough to pay off the loan. If you really want to buy such assets, pay in cash so you don’t have to pay the cost of borrowing.
6. Share your blessings. There seems to be a unique formula at work which is normally you would see in the Bible and any other religious literature: The more you give, the more you are blessed back in return. Help those who are in financial need, and you may find yourself blessed all the more. If you’re an employer, share profits with your employees; they’ll be more motivated to work for you, leading the way to better output.
7. Train your kids to treat money well. It would be heartbreaking if money you earned will just be spent unwisely by the next generation. Educate children the fundamentals of money management, and warn them against vices such as gambling and drugs. Being in charge about wealth will be rewarded in the long run.
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One Response to “What Does It Take To Be Filthy Rich?”
I really like this great list of yours. I like the idea of giving back a little, even if you don’t have too much, there’s always someone less fortunate then you that could use a hand.
I stumbled this. Nice site.
Lisa
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Greener Pastures (Who am I?) on Jul 12, 2008