Having a rich mindset is something that every person can achieve. And it is not something that you have to do overnight. The first thing that you need to do is to learn the basics.
Getting rich is not a “stroll in the park”
Getting rich is not a stroll in the park. It’s a journey full of detours and novelty gifts. One must have a firm grasp on one’s personal finances before laying claim to riches. The secret is in making the right decisions. Choosing the wrong investments at the wrong time is a recipe for disaster. Fortunately, there are ways to mitigate this calamity. In addition, a little diligence will go a long way.
It’s no secret that getting rich takes a lot of hard work and smarts. In order to succeed, one must be willing to commit to a new life style. Luckily, there are many reputable organizations and individuals who can help a seasoned pro make the leap from a hardscrabble scrooge to an upstanding human being. There’s also a plethora of high-end financial services and insurance providers to choose from. The key is to make the right choices and stick to them. Some of the better companies offer personalized financial assistance.
Rich people build assets while the poor and middle-class acquire liabilities
One of the most important lessons you can learn about becoming rich is to understand the difference between assets and liabilities. Most people think of an asset as something with cash value. However, there are many things you can be considered an asset, including your home and investment real estate.
The key to becoming rich is to create a solid asset column. To do this, you need to avoid the rat race and focus on building up a solid financial position. You also need to avoid buying everything on credit and taking on unnecessary risks.
Assets are investments that make money. This includes your home, investment real estate, your car, your savings account, and your retirement accounts.
Liabilities, on the other hand, are expenses. These can include your mortgage, credit card debt, or even your car note. Some liabilities you may incur include eating out, health club memberships, vacations, or other subscriptions.
While you may be able to get a mortgage to buy a house, this is a short term liability. As your family grows and you start to pay for more, the house may eventually become an asset.
Rich people save 10% to 20% of their net income
The rich get richer, the old saying goes. Inflated prices have a way of raising the bar on your standard of living. Those of a more modest means will find saving and investing to be a challenge. Luckily, there are more than a few companies whose mission is to help you sock away your money in a secure and stable manner. For example, there are insurance companies and investment companies if you don’t have the inclination or the clout to do it yourself. There’s also an increasing number of financial institutions whose focus is on helping you navigate the tricky territory of retirement.
One of the easiest and most rewarding ways to save is to open a savings account. Unlike traditional bank accounts, these savings accounts allow you to set up and defer your deposits and withdrawals. This can be particularly useful if you’re a young professional in a job you don’t enjoy, but still need to pay your bills.
Robert Kiyosaki’s philosophy
Robert Kiyosaki, author of Rich Dad Poor Dad, has a philosophy of a rich mindset. He advocates building multiple income streams and learning how to invest.
One of his heroes is Warren Buffett. However, he has also been accused of practicing questionable legality.
When Kiyosaki was younger, he had two “dads”. His biological father, who was a well-educated man, couldn’t teach him how to become rich.
As a teenager, Kiyosaki had a friend, who’s father was a successful businessman. The friend wanted to be rich.
When his father discovered that the two boys were making counterfeit nickels out of toothpaste tubes, he told them that this was illegal. Consequently, the boys couldn’t buy cars with their money.
Although the father didn’t finish eighth grade, he knew enough to get a job. But he wasn’t happy with the salary. That’s when he offered to pay him 10 cents an hour for three hours each Saturday.
Later on, the son started to learn about investing. Unfortunately, he lost more than he could afford to lose in the stock market.
