The rich folks in the world think and act differently than everyone else. The thing is, a lot of the wealthiest people not only had to earn their wealth, but now they also have to add to it and maintain it. If you ever wanted to know how they achieved that sort of financial success, you have to start with what the rich know about money.
Here are seven things that the world’s richest people know about money.
1. Know how to budget
The backbone of a sound financial plan is a budget. Budgeting helps you make the most of your money and reach your financial goals.
To create a budget, you first need to know how much money you’re bringing in. Some people choose to use their net income as their starting figure, while others like to use their gross income. Then, list all of your expenses so you know where your money is going. After that, track your spending for a month and see how it compares with your budgeted amounts. This will allow you to look for places where you can cut back on spending.
Once you have a budget in place, stick to it.
2. Understand the importance of an emergency fund
Do you already have a fully funded emergency fund? That’s great, because only 41 percent of Americans say they would cover an unexpected expense with their savings.
Your emergency fund should be able to cover four to seven months’ worth of expenses.
You should keep the funds in an easily accessible place. No, not your mattress or a safe. Think about storing the money in a savings account or money market account. These types of accounts offer a return on your money, and you’ll have access to it if an emergency strikes.
3. Be a lifelong learner
Invest in knowledge, so you can keep growing into your future.
With roughly 44 million Americans owing more than $1.4 trillion in federal student loans, being a lifelong learner doesn’t have to mean spending a lot on graduate degrees.
4. There are ways of getting almost anywhere you want to go, so long as you really want to go.
Make your own luck. You can’t wait around wishing all your life or you’ll end up a broke, miserable fool who’s all alone. If you truly want to acquire an item, achieve a goal, or turn a dream into a reality, you must put in the work and pay the price of action. So long as you keep pulling the trigger, regardless of how well your aim is, eventually you will hit the bullseye.
5. Be confident
Confidence is quiet. Insecurities are loud.
The loudest of men have something to prove. They need attention in order to feel validated, wanted or accepted. Confident men believe in both their words and actions, they seek no one’s approval other than their own.
6. The best way to escape debt is to get angry about it
No one wanders out of debt. The only way to defeat debt is with passionate intentionality, determination and hard work. In other words: you have to get angry about debt, and concentrate your energies on eradicating every shred of it. Perhaps the most effective method of getting rid of debt is the “Debt Snowball” method. While you pay the monthly minimum on every debt, you attack the smallest loan with vengeance until it’s gone, and then move to the next and so forth. Each win – no matter how small it may seem – will uplift your spirit and move you closer to financial freedom.
7. Build your dream or someone else will hire you to build theirs
Start a business or start accepting the reality of working for another man. Many men dream of being their own boss, yet, very few pick up the call and accept the challenge.
Being your own boss isn’t just about the money, it’s about the freedom. The freedom to do whatever what you, whenever you want. That’s priceless.
The ability to grow your income based on the amount of work you put in is simply said: Seductive.