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Wealthy people tend to think differently than those who struggle financially. They’re more likely to focus on the future than the past and less concerned with material possessions. Not to say we shouldn’t enjoy the finer things in life every once in a while. I’m also not saying that we should become obsessive penny pinchers (this could lead to unhappiness and resentment within relationships). Nonetheless, there is a mindset and habits the wealthy have adopted to attain and maintain their financial status!
Before we dive into the habits that most wealthy possess, let’s decipher the difference between what it means to be wealthy versus rich. Wealthy individuals typically have adequate money to live sustainable lifestyles by properly managing and controlling their finances and investing for their future. Conversely, rich individuals have more than enough money to live comfortably but aren’t concerned about the sustainability of their finances. Instead, they spend all of their money on materialistic or non-sensical items simply so they can showcase (or “flex,” if you will).
Many “rich” individuals that’ve attained large sums of money have unfortunately gone bankrupt. Most of those individuals could’ve avoided it, but we’ll touch on that later in the post. Instead, here are a few habits /ideas the wealthy have lived by to attain their status, which you can adopt today!
That is if you haven’t already, of course.
- Acquire Assets
- Live Within Your Means
- Your Income Doesn’t Matter
- Money Is a Tool, Not The End Goal
- You’re Always Learning
Acquire Assets
A wealthy mindset is one where you view money as an asset, not a liability. You see yourself as having enough money to meet your needs now and in the future. With this mindset, you’d also believe you should use the money to help others, not just yourself.
An asset is something that brings benefit to you long-term. Some examples could be education, real estate, stocks, a business, or even antique items that increase with value over time. Using debt to purchase a long-term asset is also okay.
Debts such as student loans, mortgages, and business loans benefit you by increasing your ability to make more money. We can call these good debts.
I’m not saying we can only purchase assets that bring us value! We all deserve to treat ourselves to nice things every so often. We are human and deserve to indulge in the money we’ve worked so hard for.
But indulgences shouldn’t be at the detriment of our financial future. Loading up on credit card debt that you cannot repay isn’t ideal. Also, an auto loan for a new car that depreciates right after you take it off the car lot isn’t intelligent. It’s all about balance!!
Live Within Your Means
To live a wealthy life, we must live within our means. This means we need to ensure we’re spending less than we earn. It’s dangerously easy to fall into debt if we are continuously overspending. However, if we live below our means, we will never go bankrupt because we can’t run out of money.
Do you know how often a lotto winner goes bankrupt?
An article by Readers Digest states that nearly 70% of lottery winners go bankrupt.
Even better, do you know how quickly it happens?
Lottery winners have typically declared bankruptcy within five years or less!!!!!
This happens because they didn’t adopt wealthy habits, to begin with. There is an instance of a winner attaining a cash prize of $20 million and losing it all. Yea… let your jaw hit the floor; mine certainly did.
If these winners acquired sustainable spending habits (lived within their means), they could have stretched that caliber of money for generations. But unfortunately, this is a perfect example of a “rich” mindset.
This habit is the key to success regardless of where you are in your wealth-building journey. Any financial professional would stress this to you until they are blue in the face. Whether your net worth is $100 or $100 million, you must live within your means.
Your Income Doesn’t Matter
I know this is a blunt statement, but hear me out! You can become wealthy by simply living by this idea. Let me explain.
As long you have enough money to comfortably pay for your rent/mortgage, essential bills, food, and debts (if you have any), there isn’t a genuine need to increase your income.
Yes, increasing your income is always great, but that isn’t essential to your living situation.
Typically our incomes grow as we get older. Whether that increase is due to a slight cost of living wage increase or a big promotion, your wages will rise.
We don’t need to increase our expenses at the same rate as our wages. If anything, we should increase the money we save and invest!
A wealthy person thinks about money differently than other people do. They focus on the things that matter in life instead of those that don’t. You don’t have to buy a $90 Thousand Maserati just because you can afford it, mainly if your paid-off vehicle is functioning correctly.
There are instances where our family may grow larger. A family of five living in a two-bedroom home in the US isn’t ideal. An upgrade in the house would be reasonable if our income allows it.
Heaven forbid we buy a 10-bedroom house for a family of five if we want to build wealth. That’d be counterintuitive. Just because we have the income to qualify for the mortgage doesn’t mean we should get the house.
Money Is A Tool, Not The End Goal
You can’t go wrong by using money to yield more growth. This growth could be an investment in education, Investments, starting a business, traveling the world, or supporting others through philanthropic efforts.
Money is a tool to get us and those around us to go or where we want to be. So simply making money to put it in our pockets is nonsense! Money has a purpose, and that purpose should be to further our advancement!
Getting into a job or side hustle with the sole intent to make a lot of money can be detrimental to us. What does money mean if we aren’t passionate about what we are pursuing or happy about it?
Money isn’t meant to fill the void in our pockets but to help us be more fulfilled. That is in the mind of a genuinely wealthy individual.
You’re Always Learning
A wealthy mindset isn’t just about having money; it’s also about being able to learn new things and adapt to changing circumstances. So I would say that 99.99% of anyone who’s ended up with a large sum of money had to think of a way others didn’t or at least outwork the majority.
Money isn’t just going to fall in your lap one day (that’s a rich idea). The wealthy know they must keep learning and finding innovative ways to progress themselves, increasing their net worth.
I source all the individuals noted below from Brittanica’s library.
Charles Babbage, the inventor of the digital computer, wouldn’t have been able to create without extensive learning of mathematics and engineering.
Bill Gates and Steve Jobs wouldn’t have been able to innovate the personal computer to create Microsoft and Apple then.
Warren Buffet, a billionaire investor and entrepreneur, wouldn’t have gotten where he was today without consistently studying finance or the financial markets.
Kevin Hart wouldn’t be the famous millionaire comedian and actor he is today if he didn’t spend countless nights in comedy clubs to learn and perfect his craft.
We must understand that wealth starts with our minds. And to fuel wealth, we must first fuel our minds by learning.
What wealthy habits do you think you can work on today to become a better version of yourself? Tell me about it in the comments below!!!
