1. Change the Way You Think About Money
Because they don’t understand the nature of money or how it works, the vast majority of people never accumulate a substantial nest egg.
The overarching principle here is that capital, like people, is a living thing.
When you get out of bed and go to work, you are selling a product – yourself (or more specifically, your labor). When you realize that your assets wake up every morning with the same potential to work as you, you unlock a powerful key in your life. Each dollar you save is equivalent to one employee. Over time, the goal is to make your employees work hard so that they can earn enough money to hire more workers (cash). When you have achieved true success, you no longer need to sell your own labor and can instead live off the labor of your assets.
2. Develop an Understanding of the Power of Small Amounts
The most common mistake most people make when attempting to figure out how to become wealthy is believing they must begin with a Napoleon-like army of funds at their disposal. They are victims of the “not enough” mentality.
There are numerous stories of people who began with very little money. Do not dismiss the day of modest beginnings!
3. With Each Dollar You Save, You Are Buying Yourself Freedom
Money has the ability to work in your favor; the more of it you use, the faster and larger it has the potential to grow. With more money comes greater freedom. It is possible to begin building wealth today if you have any source of income. It may only be $5 or $10 at a time, but each of those investments is a stepping stone toward financial independence.
4. You Are Responsible for Where You Are in Your Life
A friend once told me that he didn’t want to invest in stocks because he “didn’t want to wait ten years to be rich…” He’d rather enjoy his money right away. The folly with this type of thinking is that the odds are, you are going to be alive in ten years. The question is whether you’ll be better off when you get there. Where you are right now is the result of all of your previous decisions. Your life is a reflection of how you spend your time and money. Your fate is determined by those two inputs.
5. Consider Becoming an Owner of Things You Understand or Use
I began with little and eventually decided to prioritize finances and began to acquire ownership of productive assets. It came down to priorities. The miracle of compounding did the heavy lifting for me by respecting every dollar that passed through my hands and making a conscious, informed decision about how I wanted to put it to work.
When you understand this, you understand that in societies such as the United States, where the trend for several centuries has been lower and lower rates of millionaires and billionaires being made up of first-generation, self-made rich, building wealth is often a by-product of wealth-building behavioral patterns. It’s elementary math. Replicate the behavior, and your net worth will grow.
6. Study and Admire Success and Those Who Have Achieved It… Then Emulate It
Success and wealth produce more success and wealth. You must buy your way into that cycle by assembling your army one soldier at a time and putting your money to work for you.
7. Realize that More Money is Not the Answer
More money will not solve your problem. Money acts as a magnifying glass, accelerating and exposing your true habits. If you are not capable of handling a job paying $18,000 per year, earning six figures is the worst thing that could happen to you. It would annihilate you.
8. Unless Your Parents Were Wealthy, Don’t Do What They Did
Don’t do what your parents did if they weren’t living the life you want to live!
Make saving and investing a priority in your life by paying yourself first.
9. Don’t Worry
The miracle of life is that it doesn’t matter where you are as much as it does where you are going. Every dollar in your possession is a seed for your financial future. Rest assured that if you are diligent and responsible, financial success is unavoidable.