They are logical about money -
The rich do not get emotional about profits or losses. They take calculated decisions when it comes to making money. There are no emotions involved. Moreover even if they lose money on some bad decision or bad investment, they move ahead after analysing the reason for the loss and calculating the amount they lost. They do get affected by loss but are not overtly panicked about it or too sad about it. They learn from their mistakes.
They aim high -
The not so rich people set goals that they can attain. For example, a project manager in an IT company will probably set the goal of being the Head of Delivery for one region in the next 3 years and overall delivery lead in the next 7 years. These are great goals to have but they are safe goals. Someone who truly wants to be rich will have goals that push him beyond his comfort zone, challenge him or inspire him. For example, Bill Gates's goal at the beginning of his career was to put a computer on every desk in every home and office in all the world.
They live below their means -
Rich people do not spend money recklessly. They look for value when they spend. Warren Buffet has no fancy yacht or car. Aziz Premji is known for his modest lifestyle too.
Becoming wealthy is a slow and steady process. You have to spend less than you earn month after month for many years. You have to make your money earn more money every year. It is not a heady feeling but these steps will help you reach your financial goals.
Some ways to live below your means -
- Do not buy the most expensive things in the market. Buy one that is functional and fulfils your requirements.
- Increase your savings at every opportunity.
- Avoid visiting online shopping websites and malls for entertainment. You will end up spending unnecessarily.
The not so rich people work hard. They clock many hours in office in the hope to earn more, get promoted. But the rich people think differently. They not only work hard in their main source of income but also make the money they have earned work for them. They do not let money lie idle in the bank. They invest money in different assets. They use money to increase their business network which in turn helps making more money in the long run. They ensure they maximize their income and minimize taxes.
They have a diversified investment portfolio -
Wealthy people spread their wealth across investments. They own stocks, MFs, real estate, fixed income assets, startups etc. They also invest in themselves. They utilize money to lean new skills and update their knowledge. They spend money in networking and effective seminars where they can take build strong networks to advance their career or increase business prospects. A diversified portfolio means you have multiple sources of earnings growth and at the same hedge your losses in case any investment backfires.
They have behavioural traits that help them to be successful -
Rich people do not complain about what is not right. They take action and make things happen. For example when early in his career, Richard Branson's flight got cancelled, he decided to rent a plane. But he did not have enough money. So he put up a sign: “$29 for a plane to Puerto Rico.” Most passengers signed up. He thus got the money to rent a plane and he could reach his destination. They value time. They focus on using their time to do things they love and get success along the way. Rich people appreciate the privileges they have and value them. This helps them generating more privileges and wealth. Those who do not value privileges and favourable circumstances will not remain rich for too long.
They get financial education and advice -
The rich are careful about their money. They teach themselves how to manage money. They keep track of financial information on a daily basis. They get professional advice from credible sources on how to manage and grow their money. Many people who are not so rich feel they cannot handle investments and stay away from them. They invest only in low risk products. Some of them also feel getting advice is a waste of money.
Hard work and dedication are important to earn money. But there are some other things that make a difference. It is not easy to ingratiate the above mentioned aspects easily in our life. But over a period of time, they will become a part of us and we will be more successful when it comes to money.