All of us often dream, even if idly, of some day growing richreaching that enviable state of financial freedom when you don't have to work for a living; when, instead, you can choose to live the way you want to, and do only the work that you choose to.
So, what is it that the "rich" do differently about money than most of us -- after all, they are getting a very different result, so they must be doing things differently.
Well, here are five important secrets of the rich. There are others, too but these are the tougher ones to master -- though deceptively easy to outline.
1. The Rich Believe they Can be Rich!
If you doubt whether it is possible to grow rich, pick up any business newspaper or celebrity magazine, or simply flip through the ubiquitous Page 3. There in front of you are hundreds of self-made individuals who are financially free, so it follows that financial freedom is possible.
Now, don't start thinking, "Yes, but they have talents that I don't have". While this may well be true, but it is just as likely that you have talents that they do not possess. What they probably do have, however, is the utter conviction that it is possible to grow rich.
It is a given which you can check against your own achievements that for the most part, we get what we expect in life. So, for starters, if you don't believe you can ever be rich--well, you probably won't ever be.
2. The Rich Spend Time and Effort in Learning about Money
Despite the importance we attach to money, we give very little time to figuring out and mastering the skills for growing our money. At best, we snatch a few hurried, distracted minutes here and there on our own finances, typically when a life insurance premium becomes due, or the tax deadline looms large, or some problem has become apparent.
It is patently absurd to believe that financial freedom will one day be handed to us on a platter, or that it can be achieved without dedicating time and effort in learning the appropriate money skills. Or, that one can grow wealthy without the same passion and ambition that we bring to so many other areas of our lives? The simple fact is that, other than through fortunate birth or blind luck (and, if Lord Kubera is statistically fair, there is bound to be as much bad luck out there as there is good), financial freedom cannot be achieved without investing the time and effort at mastering the necessary, fairly straightforward skills.
The rich spend time and effort in learning what makes money tick.
3. The Rich Look for the Right Money Advice
An important secret of the rich is that they and don't passively rely on financial institutions for advice. After all, all such institutions are in the business of making money by selling you some financial product or service. It naturally follows that their advice is likely to be biased, whether subtly or more obviously so.
When the rich need financial advice, they hire and pay impartial professionals for it and thus remain firmly in control of their money.
4. The Rich are Good at Applying the Tricks of Growing Rich
Applying the tricks of the rich is nowhere as easy as learning the tricks themselves. This is because it requires a change in habits that are deeply ingrained, familiar and comfortablebut, not financially productive. To succeed, you must be prepared to change the way you have done things in the past.
5. The Rich Know Why they Want to be Rich
Ultimately, you must know why you want to be rich. Financial freedom as a notion is hardly sufficient to motivate most of us. Those who do get rich know exactly what they are going to do with their freedom. Whether it is spending more time with their children, traveling, working for charity, writing a book, lying in the sun -- the reasons are numerous and varied.
If I could wave a magic wand and make you rich right this moment, what would you do? Without the necessity to work, how would you fill your day? What would you do that you have always wanted to do? Where would you live? And, so on? Do you have your answers? If not, your dreams of becoming rich will probably remain mere idle dreams.
This, above all, is the ultimate secret: the rich are rich because they know why they want to be rich.
Kapil Malhotra is an alumnus of IIM, Ahmedabad and publisher and editor of Vision Books, a specialist publisher of investment books.
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