Things you need to know if you want to be rich
There are some things you just need to be aware of if you plan on being wealthy in this lifetime. While doing these things alone won't put you on the Forbes top 100 tonight, they will certainly help you on your path there.
1: You will need to start now
Life is short, you hear this all the time and yet somehow more time is spent hearing it than taking action on it. Doing anything later or even right now will not assure success but the goal is to give yourself the best chances. Starting now will increase your chances of success, granting you the time you need to reach your end goal.
In other words; that book you want to read, read it. That podcast you want to record, record it. That skill you want to learn, learn it. That blog you want to write, write it.
What I am trying to say is, every day you put something off you could be pushing back your dreams, a day, a month, a year or sadly for many indefinitely. Start now, I mean it, literally, come back to this post later!
2: It won't happen suddenly but gradually over time
While we all want to wake up with a wealth of money, perhaps a business that is our baby or even a family with a baby. It just won't happen like that. Now while success is often exponential, that is it speeds up as you get closer to it, or more of it. Whether it be financial, business, marital etc. it will happen slowly at first and that may be a long period of time for many of us.
So, if you took my last advice in #1, just know things most likely won't be amazing straight away. In-fact often things start better then go downhill as problem after problem piles up. Elon Musk himself, spoke about this in an interview when asked for advice regarding starting businesses. If you are starting a business or learning the stock market, you will find hurdles you have to jump and that is part of learning. You have to embrace the challenge and know you are working an 80-hour week now so you can work a 20-hour week later while making 10x the income.
3: You'll need to invest (or find other means of passive income)
You will need to find a means of making money when you sleep (this is passive income). Besides being an amazing feeling, it is also vital to your chances of success.
There are a definite number of hours in a day and we have a limited amount of energy and will-power. This is why investing is so important in one's journey to financial success. Not to mention, most billionaires across the world made their fortunes through investing. While investing can be scary to many of us, as long as you really do your research into whatever investing instrument you choose it will surely be worth your time.
How exactly? Start researching all the ways you can invest, stocks, bonds, real estate, p2p lending, mutual funds, etfs, cfds. Do your research until you FULLY understand it. You will then be able to best mitigate risk and give yourself the best chance of earning good returns while you sleep!
4: You'll likely need multiple sources of income
Having one source of income is similar to chucking all your hard-earned cash into an investment you have no idea about and failing to diversify completely. While many factors determine the exact risk of one particular source of income, you should never rely on it!
Having multiple sources of income alleviates the risk of losing money in case one were to reduce or cease completely. Moreover, often one source is not enough. If you are lucky enough to have a job that pays really well that is great, but you still have cause to create others. By having various sources of income not only do you increase your income and mitigate risk but often some or all will be passive. This is where we double in with advice in #3.
5: You need to be frugal and save
Most of us were taught to save as kids yet most of us simply don't save enough. The Australian Security and Investments Commission studies show while more than half of us save (2/3, leaving 1/3 living pay check to pay check) we save very little and often believe we can't save more because of our lifestyle habits. This is where being frugal comes in, that is, living simply.
Look at big shot billionaires like Mark Zuckerberg and Warren Buffet, whom drive a 30,000 AUD Acura TSX (23,000 USD) and a 45,000 AUD Cadillac XTS (34,500 USD) respectively. These are guys you would expect to be driving Rolls Royce and Mercs.
Bottom line is if you want the wealth these guys have, you need to have their frugal mindset as well and be able to save as much as you can in order to really take advantage of what I would call the sweetest deal in finance, compound interest (this is when you make interest in your interest).
6: You need to earn more
While there is a limit on how much you can save (you need to eat, cloth and wash yourself) there is absolutely no limit on how much you can earn. The sky's the limit, go for gold!
While your first priority should always be to save (It is pointless earning more if you spend it meanlessly) you should always aim to earn more. Be that through creating additional sources of income via a side business, investing or other means. This is because not only will you be able to spend more but also save more, invest more and consequently create wealth earlier.
Final remarks
Remember, you are not really chasing wealth. You are chasing freedom and happiness. Keep that in mind and work to become a philanthropist as well as a billionaire. I think you will find it is a much easier and more enjoyable journey this way.