There is an old saying that “The rich just keep getting richer”. Is there truth in that statement? Well, let us take a look at the habits of “the Rich” to see what they are doing differently than the middle class and poor to see if there is something going on that is unfair or unobtainable for average Americans.
They spend less than they make
You are probably sitting there thinking to yourself “Well, no DUH Steve. Of course they spend less than they make, they’re rich”. Have you ever thought of it all the way through? They keep household expenses down, pay off (eliminate) debt, don’t overextend themselves for a car or home, and they don’t spend every penny they earn before the weekend is over. Sometimes they do without something they would like in order to get something they love. In other words, they spend less than they can.
They work with professionals, consultants, tax experts, and coaches
I hear this all the time: The Rich “know someone” or “don’t pay their fair share of taxes” because they “got a guy”. There is nothing illegal about taking legal tax deductions and avoiding taxes whenever possible. Do you believe working with an expert could help you improve your game? Stop taking your financial education from the “roaming reporter” on the street or your broke brother-in-law and work with professionals who have an expertise in investing, real estate, saving on taxes, or even your everyday household expenses and debt elimination plans
They buy things wisely
What items do you see the rich buying? Are they of poor quality? They are usually of good to exellent quality and they maintain them well. You can’t expect something from the Dollar Store to last more than a week, so things of importance are researched and/or tested before plopping the money down on the counter. They find good investments to put their savings in (anyone can open a savings account or invest in mutual funds) and don’t waste money on get-rich-quick schemes like the Lottery or Wealth Without Risk programs.
They do what they say
Dr. Thomas Stanley studied America’s weatlhy population and is best known for the award winning book The Millionaire Next Door: Surprising Secrets of America’s Wealthy. His research found that Integrity was the #1 factor that explains a millionaire’s success (from studies discussed in his book The Millionaire Mind).Rich people do what they say they will do and try to do it with excellence. We don’t hear much about typical millionaires but hear A LOT ABOUT Bernie Madoff and those involved in the Enron scandal – but they aren’t rich anymore. They did not have integrity and did not do what they said they would do, so they no longer get to be rich. Integrity is like locamotive: You believe it will stay on the track, but once one of them jumps the rail you lose trust for all of them. Don’t fall prey to the media, very few trains jump the tracks.
When someone has control of their money, lives on less than they make, and lives with integrity, they tend to be givers. They give of their posessions, time, and money through charitites, churches, non-profits, and all sorts of volunteer organizations. Have you ever given to someone with a real need when a gift was not requested or whom you did not have any personal ties to? It’s the greatest feeling in the world! Giving is truly the most fun you will have with money (I double-dog dare you to test me on this).
THE BOTTOM LINE
There are no secrets or tricks here and the typical millionaire worked for their wealth (it wasn’t given to them). WE CAN ALL BE RICH IF WE FOLLOW THESE SAME HABITS, NO MATTER THE INCOME RANGE. Those of us earning $100,000 a year can do these things, and those of us earning $25,000 can do these things although it may be more difficult. But if you live on less than you make, do what you say you will do, learn/work with professionals when needed, and make wise purchasing decisions then you can be rich too! Don’t look for it to happen overnight. You need to stick with it and change some habits, just like “The Rich” do in order to get richer.