Today, I want to share with you the secret of wealth. I’ve read it in my favorite book ” Sun Flower” . So I hope it help you to keep your money and become a millionaire .
“What most people don’t realize is that wealth isn’t the same as income. If you make $1 million a year and spend $1 million, you are not getting wealthier, you’re just living high. Wealth is what you accumulate, not what you spend.
How do you become wealthy? There, too, most people have it wrong. It’s rarely luck or inheritance or even intelligence that builds fortunes. Wealth is more often the inexorable result of a persons hard work, perseverance and, most of all, self-discipline.
So millionaires are dull? By Hollywood standards, maybe. But these dull folks have something exciting to teach us about money.
Attitude is the greatest difference between millionaires and the rest of us. The rich follow certain rules. Here are some of the most important ones :
1. Live below your means
The most successful accumulators of wealth spend far less than they can afford on house, cars, vacations and entertainment. Why? Because these things offer little or no return. The wealthy would rather put their money into investments or their business. It’s an attitude.
Millionaires understand that when you buy a luxury house, you buy a luxury life-style too. Your property taxes sky-rocket, along with the cost of utilities and insurance, and the prices of nearby services, such as grocery stores, tend to be higher . The only thing worse than a big house, is the flood of problems that comes with it.
The rich man’s attitude can also be seen in his car. Many drive old unpretentious sedans, Sam Walton billionaire founder of the U.S.Wal-Mart stores, Inc., drove a pick up truck. Another fellow said, “I buy them by the pound – the biggest car I can for the least amount of money.”
2. Emphasize net worth; deemphasize income.
Most millionaire measure success by net worth, not income . Instead of taking their money home, the plow as much as they can into their businesses, stock portfolios and other assets. Why? Because the government doesn’t tax wealth, it taxes income. And the more income you bring home for consumption, the more the government takes.
The person who piles up net worth fastest tends to put every dollar he can into investments, not consumption. All the while, of course, he’s reinvesting his earnings from investments and watching his net worth soar. That’s the attitude as well.
3. Cultivate good advice.
The best wealth-buiders pay careful attention to their money and seek professional advice. Those who spend heavily on cars, boats and house, tend to skimp on investment advice. Those who skimp on the luxuries are usually more willing to pay top dollar for good legal and financial advice .
They are alos always looking for new investment possibilities. The most mysterious part of wealth accumulation may be this sixth sense that some millionaires develop for hidden opportunities.
One of the finest example I’ve come across was a doctor. He was renowned for buying a parcel of land just before a shopping mall located across the street, and stock in a new bank just as it was taking off.
Where did he get information? From his patients . While rendering care, he learned of investment opportunities before they were common knowledge. And he was shrewd enough to separate the good tips for the bad.
4. Develop a plan.
The self-made rich develop clear goals for their money. They many wish to retire early, or they many want to leave an estate to their children. The goals vary, but two things are consistent: They want to save by age 50, perhaps – and they work unceasingly toward that goal.
Start developing a plan now, regardless of your age. How much do you want to accumulate, and by what age? Then work backward. To meet your goal, how much should you save every year?
One thing may surprise you. If you make wealth – not just income – your goal, the luxury house you’ve been dreaming about won’t seen so alluring. You’ll have the attitude.