Getting rich is a dream most people all over the world have. In fact, it probably wouldn’t be wrong to say that this is the driving force behind most of what we do.
After all, don’t you dream about a life where you’re not just able to pay your bills? Where you also have a lot of extra for the fun stuff like travel, leisure, and luxury?
Yet, for many, this aspiration seems distant and impossible. Wealth seems like a far-fetched concept, reserved only for a lucky few.
But you know what? Building wealth isn’t about having an innovative mind like Elon Musk’s or winning the lottery (although of course those would help).
It’s more about having the right mindset, perseverance, and wise habits. That means letting go of some habits that get in the way.
Let’s dive into nine behaviors to say goodbye to if you want to get rich:
1) Living beyond your means
Naturally, I’ll start with the most basic financial lesson: don’t live beyond your means.
I know a lot of people who overreach, buying stuff that costs way beyond what they can afford.
Clothes. Designer bags. A fancy car.
Meanwhile, their credit card bill goes up every month because they can’t pay it in full.
Before they know it, they’re deep in debt and have to call in the debt consolidation guys.
When it comes to money, it always pays (pun intended) to cultivate a lifestyle of frugality.
Case in point:
Warren Buffett might be one of the richest men in the world, but he is the paragon of frugality. He still lives in the modest house he’s had since the 1950s and eats at local restaurants instead of fancy ones.
I don’t mean to say you should deny yourself every little thing that makes life fun, but there does need to be a balance and you do need to make smart choices.
Personally, I love looking through thrift stores and online deals. Not only do I get alternatives that make my wallet happy, but there’s also a thrill to finding unexpected treasures!
2) Neglecting to save
Of course, this is what happens when you live beyond your means – there’s nothing to save if it’s all gone.
But even if you live within your means, you might still be putting off saving for the future.
When I was younger, I was exactly like that. Whatever extra I had, I didn’t save it – instead, I’d use it on night-outs or expensive gifts for the people I loved.
I guess when you’re young, you tend to think that you have lots of time to save anyway.
But when I hit my 30s, I woke up to the fact that time isn’t limitless. The days pass by quickly, and every day I don’t save is time I’ll never get back.
So don’t put off saving. It doesn’t have to be a huge amount; no matter how small you manage to save, it still gets you in the right frame of mind about how to handle money.
Now, you might ask, but what if there literally is nothing left after I pay my bills?
Then, this next section might help…
3) Being content with a single income stream
Remember that old saying, “Don’t put all your eggs in one basket”? That’s exactly how we should think about money.
Yes, your job might be stable. Your paycheck might be hefty enough that you can pay your bills and save a tidy sum each month.
But let’s get real: What happens if you suddenly get sick? Or laid off? The money you saved will only get you so far.
So, why stop at that single paycheck? In today’s gig economy, there are so many opportunities to diversify income.
Explore side hustles. Maybe the paintings you do in your downtime or your skills in dressing up cars can bring you some side income.
And I can’t stress this enough – generate passive income. This is one of the most useful things I’ve done in my life, and I enjoy multiple income streams without all the work!
Here are some passive income streams that might appeal to you:
Real estate investments
- Mutual funds
- Dividend stocks
- Sales and royalties from creative/intellectual property
- Car/property rentals
That said, you do need one other thing as you delve into all these financial opportunities – courage.
4) Being afraid to take risks
Fear can be paralyzing, especially when it comes to money. After all, it’s a bit like gambling – you’re betting your hard-earned money on something new.
…Which you don’t know if it will be a success or a mistake.
But as they say, without risk, there’s little reward. Let me rephrase that: without calculated risk, there’s little reward.
So, what can you do to overcome that fear? For starters, you can:
- Do your research thoroughly.
- Consult a financial advisor if you want to be more sure.
- Go for low-risk investments.
5) Falling victim to get-rich-quick schemes
Speaking of risky investments, one thing to absolutely steer clear of are get-rich-quick schemes.
I understand the temptation. Who doesn’t want to invest in something that calls for a little investment but promises massive returns?
Well, if this is something you’re prone to, it might help to remember all the cautionary tales…
The Bernie Madoff scandal. BitConnect. MLM schemes (LuLaRich, anyone?). Basically anything that smacks of a Ponzi or pyramid scheme.
The lure of fast money is appealing, but more often than not, it’s a dangerous trap.
Any billionaire will tell you that building wealth takes time and patience. It comes from sound investments and hard work, not gambling on shady deals.
Sound. Slow. Steady. This is what wins the race.
6) Letting emotions rule your finances
Actually, emotions are what’s responsible for buying into those get-rich-quick schemes. That’s why all logic flies out the window.
But aside from that, take a look at how your emotions play into your finances. Are you the type that uses retail therapy to soothe yourself?
For me, my weakness is food. Whenever I feel down, I go eat at a (more often than not) expensive restaurant.
And I had this “I deserve this!” mindset much too much.
I mean, there’s nothing wrong with the occasional treat and mood-booster. We do deserve those every now and then.
But if you’re chasing temporary highs too much, you might also be unconsciously choosing financial lows.
These days, I’m more mindful. I now recognize my triggers and have non-spending strategies in place for dealing with my emotions.
I advise you to do the same. Go for the occasional treat, sure, but explore other ways to feel better without reaching for your wallet.
7) Associating only with like-minded people
What about your social circle? Are they fiscally responsible or are they big spenders?
They matter more than you think. It’s no secret that the people around us exert some influence over us, though we might not notice it.
Maybe you have a coworker who comes in to work holding a Starbucks coffee every day. Maybe a shopaholic friend who urges you to buy this and that.
I suggest seeking out the company of people with a different approach to finances. Especially those who have managed to build wealth – the success stories, so to speak.
To clarify, I’m not suggesting you become a social climber or an opportunistic person. That’s just tacky.
What I mean is, make organic and genuine connections based on a desire to learn and grow as a person, while offering equal value. Find common ground and shared interests that go beyond financial status.
8) Ignoring financial education
So, we’ve talked about the fear of risks, emotional spending, and other behaviors that prevent you from building wealth.
Beyond all that, you need to become financially literate.
Investopedia defines financial literacy as “the ability to understand and effectively use various financial skills, including personal financial management, budgeting, and investing.”
Just as we know how to read books, we should also know how to “read” money.
Because let’s be honest: investing can be intimidating. And if you don’t understand it, how can you make wise investments?
So, get as much financial education as you can. Read books, listen to podcasts, enroll in online financial literacy courses…all of these can help you get a good grasp on financial terms and how money works all around.
That way, you can…
- Understand how compound interest works
- Figure out what all those rates and charges on your credit card bill mean
- Understand the different types of taxes
- Recognize financial scams and frauds
And…your eyes won’t glaze over when you listen to someone talking about business!
9) Lack of long-term vision
Finally, we get to the big picture. Do you have one?
Dreaming big is great, but do you have concrete financial goals and a clear plan to achieve them?
Let’s take a look again at Warren Buffett, who, by the way, is the perfect example of “sound, slow, and steady”.
When he hit his first million, did he go and buy a fancy car or a huge mansion? Nope.
He reinvested his first million into shares that brought him even more earnings. Over and over he did that until he got to where he is today.
That points to how he has always been clear and disciplined about his goals.
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