How rich/poor budget?

 

How rich      poor budget? “Most of our wives are planners and meticulous budgeters. In fact, only 18 percent of us disagreed with the statement "Charity begins at home." Most of us will tell you that our wives are a lot more conservative with money than we are.” I think that what “rich” people know and don would surprise most people. Reading Thomas Stanley's book certainly opened my eyes.          MILLIONAIRE           AVERAGE      25% Needs      10% Wants        65% Investing         40% Needs       55% Wants         5%   Investing     What you think as rich, the hot car, yacht in the Bahamas, 12,000 sq ft home is probably anything but wealthy. Sure, one off folks may have some money but a high consumption lifestyle is not congruent to accumulating wealth. You would never know if you past most of the actual rich folks on the street. Old cars, worn out blue jeans, humble watches and modest homes are more the style of the people that actually have money. Why? Because while making a lot of money (playing offense) is a great start building wealth spending frugally (playing defense) is what actually gets you there. I know someone that makes several million dollars a year. This person lives the lifestyle of lifestyles, carefree shopping trips, boats, a huge home in the most exclusive area, private schools, horse riding lessons … they are a huge deal. Until you talk about brokerage account balances. Then they are not impressive at all. Like horribly disappointing. They have a world class offense, no defense. Conversely, the average millionaire has never spent more than $399 for a suit, $140 for a pair of shoes, or $235 for a watch. They shop at Sears and JC Penny's. Point blank, they are frugal. Frugal people budget their money. I have heard it said that you are either poor moving towards rich or rich moving toward poor. I am willing to bet that the latter is full of people that budget their money.       NEEDS OF RICH AND POOR PERSONALITY?          5 BASIC NEEDS OF HUMANS BEING 1.shelter 2.food 3.clothing 4.Water 5.health Care (safety, protection) The rich and the poor is merely a comfort factor, with the rich being able TO afford the premium brands of ENPS, while the poor can only afford the generic or cheaper brands of ENPS which are, or some of which, can be provided free of cost. Therefore, rich personality is spending the money in less needs but healthy for body. In other hand poor personality is spending the money in more needs but they are dangerous for health. For example, He gets enough sleep. Even on insanely busy days, Musk sleeps 6 to 6.5 hours per night. He gets a boost from a few cups of coffee during the day. Musk schedules his day in 5-minute intervals and constantly optimizes it for efficiency.          WANTS OF RICH AND POOR PERSONALITY?   WANTS OF RICH PERSONALITY 1.Avoiding debt 2.Budgeting properly 3.Setting short-term and long-term goals 4.Investing in yourself 5.Diversifying your assets 6.An understanding of risk and reward Rich personality don’t spend their money trying to impress people. But the poor personality spend money to impress other people. Owning expensive things doesn’t show our status anymore because most people can afford to buy most of this stuff on credit. I decided not to change my lifestyle after my income significantly grew and I quickly realized that things aren’t a source of happiness. Owning too many things puts pressure on you. It’s better to spend money on experiences and traveling.   WANTS OF POOR PERSONALITY 1.Why I make terrible decisions, or, poverty thoughts 2.Working for the wage 3.Temporary work 4.job security 5.drugs habits                                     Memories will last forever, but things make you happy only for a moment. And I don’t try to keep up with my friends and colleagues. You’ll never know the whole truth about the financial status of another person. I had well-off friends who were in debt and had no savings. Buying things that you don’t really need just to demonstrate your financial status and living on credit are only for people who don’t think about their future. Investment of poor and rich personality will come in the next blog……