Showing posts with label get rich. Show all posts
Showing posts with label get rich. Show all posts

Sunday, June 9, 2013

12 Tips On How to be Rich

1. Spend less than your earn and invest the difference.
 “Spend less than you earn. Successful financial planning really stems from that simple statement. If you retain a portion of your current income, you’ll soon ask yourself a question: what should you do with that money? And that question is the beginning of wealth creation. It is essential that you do not spend 100% (or more) of your current income on current expenses. One day, expenses – housing, education, medical, retirement – will exceed your affordability if you are relying solely on current income. That’s why you’ll be glad (and relieved) that you’ve got past income to rely on.  Spend less than you earn. That’s how rich people got rich.” - author Ric Edelman
2. Use  a part-time job or part-time business to add more money to your investment account.
  • Bill Gates started Microsoft on a part time basis when he was a student at Harvard University. He decided to drop out because he was too busy making too much money.
  • Michael Dell had the same problem too when he was a freshman at the University of Texas.
  • Example: Tutor, sales work, lecturing, writing-book, magazines, ghostwriter, blogging, editing, proofreading, typing, insurance agent, unit trust consultant, adult education, Network marketing.
3. Know how to use the power of leverage.
  • Work less, and earn more.
  • Leverage is the reason some people become rich and others do not become rich.
  • Employ other people in your part-time business.
  • Take advantage of network marketing.
  • Use other people's money(OPM) to create wealth.

"No man becomes rich unless he enriches others." -  Andrew Carnegie

4. Use things that appreciate. Do not buy things that appreciate.
  • Stock, mutual funds and  real estate appreciate over time. That means your money working for you.
  • Big screen television, fancy clothes, stereos and automobiles depreciate over time. That means you are going back wards -  That you are losing money. That is not the way to get rich.
5. Own your own home.
  • Renters and homeowners both make payments every months. You won't get rich collecting rent receipts. You get rich by owning real estate.
“Every day, you’ll have opportunities to take chances and to work outside your safety net. Sure, it’s a lot easier to stay in your comfort zone.. in my case, business suits and real estate.. but sometimes you have to take risks. When the risks pay off, that’s when you reap the biggest rewards.” – Donald Trump
6. Plan your tax.
  • You want to minimize your taxes so that you will have more money working for you in your investment account. You must know how to get tax exemptions.
“Good plans shape good decisions. That's why good planning helps to make elusive dreams come true.” - Geoffrey Fisher

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7. Avoid bad debt.
  • Debt can be a useful tool when invested in something that grows in value, while bad debt is money owed on a loan used to buy something with depreciating value or “debt that you can’t afford,”.  And even if you can afford the debt servicing costs now, it’s prudent to factor in the potential impact of higher interest rates in the future. If you have a lot of dept siphoning away your salary, may be the first place to invest is in reducing your debt. This is will ultimately free up more money in monthly budget that you can put into your investment program.
 “Debt is like any other trap, easy enough to get into, but hard enough to get out of.”   - Henry Wheeler Shaw
8. Start to invest now!!!
  • Let time work for you. not against you. the longer your investment fund grows, the money more you will have. Even if you invest very conservatively, time and magic compound interest will serve you well.
 “Anyone who is not investing now is missing a tremendous opportunity.”                      - Carlos Slim
9.  Protect your investment fund by reducing risk.
  • It is better to have a lower return and all of your investment fund than a higher return and sleepless nights worrying about your money. Do not involve in get-rich-quick scheme which promised high rates of return for a small investment but after few months all your money gone. Buy a book or attend seminar to learn more about investment which will decrease your investment risk by the knowledge you get.
10. Be patience on your investment.
  • Your investment would not grow rapidly overnight. Invest regularly. Buy stock when price is low and sell when stock price go up.

11. Handle your finance like adult.
  • Do not handle money like four-years-old which usually they insist on spending their allowance the same day they receive it. Saving or creating an investment fund is the furthest thing from their mind. If you handle your money like a four year-old, you will have the savings account of a four-year-old.

12. Do not worry about inflation.
Inflation will occur whether you save money or not. So why not save money? You will like inflation lot better when you have 

Source: How to get rich without winning the lottery.