Life-Altering Financial Secrets From Top Wealth Creators
When it comes to building financial wealth, everyone has a different strategic plan on how to do so. Moreover, when it comes to finances, people have different strategies and definitions of wealth.
For someone, wealth is having capital in real estate, for others having thousands of dollars on a bank account, while for others, real wealth is being able to earn money while others work for them, otherwise called – having passive income.
Being a millionaire nowadays is not enough, because anyone can be a millionaire.
With so many different sources on how to earn first million, being a member of a one-million-dollar-club is not that difficult. One just has to discover how to look on assets and to understand that wealth beyond only having cash.
Don’t get this wrong – having cash is fine, but there is more. Being wealthy means having more: more real estate, more cars, more good assets, more neutral assets, more liabilities, and even more of worse liabilities. In this case, worse is not necessarily bad.
ASSETS AND LIABILITIES
Pros and cons are basically what they call assets and liabilities.
- Pros: properties you can rent, bonds, stocks, or real estate that produce income all belong to this category.
- Neutral goods: here are goods such as home accessories, art, gold. Moreover, anything that can be considered to be an integral part of the whole (as a collection) is a neutral asset. We call them that because they can still have a value when inflation strikes in.
- Disadvantages: deteriorate accessories like furniture, TV, and numerous personal belongings are in this group. These are usually things that are simply sitting around.
- Worse Liabilities: facilities that require monthly income in order to stay functional. Therefore, those are items such as a car, cell phone, or a boat.
Of course, to function properly in the 21st century, people need much more than a cell phone and car. More assets are required. Further, more good assets must be accumulated to become wealthy.
A long time ago it’s said that if someone wants to be rich, he or she must spend time with rich people.
This way, when you surround yourself with people who live the way you want to live, you will find everyday hacks and directions on how to be rich as well.
If one can’t spend time with rich people as first, researching wealthy people and entrepreneurs that are rich is a good start.
After all, they are where you want to be, right? So, why not learn from their experience?
Still, even research can be demanding and time-consuming if you work all day long and have additional part-time jobs.
So, we researched for you and pulled the ten most effective tips on building wealth.
Here are the best financial strategies, straight from those who master the world of wealth.
THINK ABOUT BIG MONEY
If you really want to be rich and call yourself rich, you must stop thinking just about being rich. You need to think about becoming super-rich.
Once you earn the first thousand, you will realize that you can earn even more, and you will realize that numbers are, well… just numbers.
Mindset is everything!
Wealthiest people in the world think about billions in cash, billions in various assets, because they are not limited in their financial desires, and they are confident about their knowledge and skills.
That being said, don’t think about $50,000 or even $900,000. Think of millions.
At one moment, you will have to put your money at risk in order to earn more money; therefore, entrepreneurs’ mindset is mandatory. Those that are building wealth have to redefine what ‘more money’ means to them.
For example, Grant Cardone, a top sales expert, says that people must be obsessed with their success and stop thinking about being average.
For direct tips on how to stand in the crowd and stop being average, and becoming rich, Grant’s book ‘Be Obsessed or Be Average’ will provide useful advice, based on real-life experience.
AIM FOR A 4X RETURN ALWAYS
Spending money is mandatory if you want to earn money. It simply goes like that.
However, having money to ‘spend,’ or even better called – invest, is excellent and but it shouldn’t be used without a plan.
Investors tend to encourage entrepreneurs to spend as much means as possible in order to ‘scale’ faster. However, scaling up business in much more than simply spending all the money.
Scaling up demands:
- great infrastructure
- amazing leaders
- strong teams
- clear vision, and
- good planning
Without a detailed plan, spending money is simply an uncontrolled action.
Some would say that it’s even wild. Consequently, Tim Dauper – founding partner of DFJ, advises people always to raise their money, but to use it smartly.
Moreover, Tim advises people to – unless they can’t be sure that every invested dollar will actually bring five dollars, money shouldn’t be used.
In a nutshell: if you aren’t saving for at least a 5X return, you should save money.
BE WILLING TO SPEND MONEY TO MAKE MONEY
If you want great shoes that will keep you warm during the winter, you need to invest in them, right?
Basically, this means that you will buy more expensive shoes to keep your feet dry, correct? The same principle applies to creating a wealthy empire.
To have money, you must spend money. This is something that shouldn’t be difficult to understand. After all, money is made to be spent.
- Don’t desperately hold on money
- Don’t stick to your money if a great opportunity comes up
- Take a chance
You can start small, invest just $1 to get $10. From there, you will see that investing, or even spending $1, $100, $1,000, $10,000, or even #1 million, is identical.
This is something that Barbara Corcoran, an executive on Shark Tank, understands and preaches. She even advises people to take their money and catch a chance on an opportunity.
Moreover, she always pushes people to spend money just to see how far it will take them.
ONCE YOU BUY, HOLD
Being wealthy is actually hard mental work. One needs to track finance flow, invest when needed, pull when necessary, and even be up to date with global turns on the financial market.
Therefore, becoming wealthy is hard work that demands a strong mental game.
The financial strategy should always be divided into two separate parts:
- owning long-term assets and
- having positive cash flow
Mixing these two is never good. Still, many people do so without knowing how much damage they do to themselves. Make sure that you understand how these two are built are what are their traits.
- Positive cash flow: When it comes to positive cash flow, you must possess highly demanding skills. That means that your skill must be in-demand, or even better – your skill has to be rare.
With positive cash flow, monthly incomes don’t have to be super high; usually, it isn’t, but it does keep you safe enough to pay your bills, to survive, and not to have too many stressful days.
Once you master your skills and optimize them enough, you can start building your long-term wealth. Why? Because now you have cash flow.
For example, a huge number of people buy real estate so that they can ‘flip’ them later on. This business model is fine as long as your full-time job is the notorious real estate flipping game.
On the other hand, if you want to ‘flip’ without a rich real estate background, you may hurt more than you could actually win.
Warren Buffett, a famous billionaire, and multi entrepreneur, heavily believes that the best way to create long-term wealth in the real estate area is to implement ‘buy and hold’ strategy. In reality, it works like this:
- you buy solid businesses from any industry
- you buy real estate with solid rentals
- hold them for a period of time
- you welcome compound interest
By definition compound interest in the numerical value that is calculated on the initial principal. For compound interest, Albert Einstein said it’s the eighth wonder of the world. That’s how effective it is.
Buffett’s philosophy is something that Tai Lopez, a famous investor, and multimillion-dollar business owner, applies in his everyday operation.
BE OPEN TO CHANGE
In a world of globalization and fast-changing technology, being able to adjust and open to change is everything. Actually, things are moving so fast that the only constant is actually – change.
So, in order to thrive in today’s demanding world, being open to change is mandatory. Otherwise, you can expect to be defeated.
The business world is ever-changing, and if you can’t change, you won’t survive. It’s simple as that.
That’s why Jay Geogri, founder of Nadvia and operations/management / profits-retention coach, insists on willingness to be open to change.
A great business model is not meant to stay the same forever. If the time and circumstances demand it, it has to be changed. Moreover, it has to evolve. This is where businesses tend to fail.
For example, Kodak was one of the world’s leading brands in the world of photography. However, they neglected new technologies, and naturally, they failed to evolve.
INVEST IN PEOPLE
Investing in people is something that every entrepreneur should have in mind all the time.
Investing in people is easy, but investing in the right people is called being strategically-oriented.
Also, hiring the best people matters.
Having great people in your team, or your company means that you have a strong individual who is:
Hiring the best means that business owners are willing to let people take independent decisions and act on their own, respecting the values and vision of the company.
Moreover, having a strong individual means that business owners are willing to let go of micromanaging things. Therefore, investing in good salaries is O.K., especially if the employee is a great team player.
In a world where unity matters and going distance is possible only with teamwork, high salaries shouldn’t be a problem. Moreover, high salaries should be seen as an obvious investment.
Investing in people means that you far from thinking small. With great people, you and your business will simply grow. Anyone can grow faster with the right people.
Manny Khoshbin, president of The Khoshbin Company, claims that one can be the best, only when the best is hired and nurtured. Manny arrived in the States when he was only 14-years-old.
He was almost homeless, but found a way to make himself different, and stand out from the crowd.
Now, he enjoys his nine-figure net worth, and share his tips on wealth in his book ‘Contrarian PlayBook.’
ALWAYS KNOW YOUR NUMBERS
Entrepreneurs or people who are not that yet, but are now thinking about starting their own business and their wealth, have one thing in common – in the beginning, they all wear pink glasses.
Wearing pink glasses means that the world seems more colorful than it actually is. When starting business owners are in love with their idea and work, they do.
Moreover, they are passionate about their products or services so much that they tend to be so enthusiastic that they forget to deal with reality.
In the business world, reality means – math, and math means numbers.
Moreover, they tend to see the best outcome. How many times have you heard an entrepreneur saying that everyone needs his or her product? Many, probably.
This is a clear situation of a person wearing pink glasses.
So, always focus on your numbers while you nurture your passion at the same time. Knowing the numbers is everything when you are building your wealth.
One can’t be rich without high numbers, right? After all, wealth is always showed in numbers.
So, know your numbers! Cash flow is a highly demanding process.
According to Roy McDonald, founder, and CEO of OneLife, entrepreneurs miss to bank the money, and they spend it before they actually earn it.
He advised everyone to have a really good accounts team that will always provide effective, hard, timely, and accurate information.
Once you know your numbers, you can easily plan your next step. Moreover, creating an environment where leadership is strong, mastering the numbers is mandatory.
BE CONFIDENT TO OUTSOURCE
Long-time ago, outsourcing outside of your company meant that the company is in trouble.
In those moments, the outside-the-company professional had to be hired to solve a problem in a company.
In a way, people who had to do so felt ashamed and saw it as one step closer to the failure.
Luckily, people outgrow this opinion, and their approach to business changed. Now, we reached that level where outsourcing is welcomed, common, and sometimes even mandatory. Even the world’s best professionals and companies outsource.
He tells people that’s O.K. to outsource because in this way they will be able to do more and even save more money by having professionals handling their business.
LOVE YOUR FINANCES
Since finances are mandatory sector in every business, knowing how to work around them is mandatory. However, it seems that people are scared of finances, even theirs. This attitude toward finances should change.
To take your business to the next level, you will need a positive look at your finances. Finding a good accountant and bookkeeper is a must.
Creating a good relationship with them is mandatory for both of you to be on the same page. So, always make sure that you find someone who speaks your language.
Since the financial world has its own terminology and specifically vocabulary overall, it can be difficult to understand finances. Therefore, make sure to find someone who is willing to work for you and with you.
This way, you have someone to work for you and work with you to help you master your finances. This is something that Katrina Palandri, cofounder and CFO of AEG Investments, advice.
Having good financial habits is mandatory if you want to live your life without checking your bank account every time before you make payment. Building wealth is not easy, but it can be so rewarding.
The truth is that building wealth is not easy, not an overnight success, and it demands a financial diet.
Financial diet means that you should prioritize always, and be honest about your financial situation, first to yourself. The approach ‘fake it ’till you make’ is not popular anymore, because people prefer sustainability, over one-time-hit.
That being said, make sure that you follow these steps to secure yourself a nice and stable wealth:
- Master a unique and rare skill.
- Save money every day to invest.
- Build smart assets that can easily generate passive income in the long run.
- Build connections always. Network. Network. Network.
- Start your own business — plan well.
- Be willing to save money so that you can make money.
- I appreciate your time. Your time is your value.
- Live simply and use a financial diet when necessary. Don’t have impulse spending.
- Give back once you build your wealth and in between if you can.
- Have courage.
- Save 100K in one year.
- Always educate yourself.
- Surround yourself with great people. Hire the best and reward them.
- Spend time with people who are richer than you are, in any term.
- Always thrive. The learning process never stops, so always be the best version of yourself.
We’ve listed some top-notch wealth creators for your viewing and learning pleasure.
Hopefully, you’ll adhere to their advice and tips and work your way towards becoming an entrepreneur and a wealth creator yourself. However, mind that it’s not just being a successful businessman that matters, nor is wealth just a financial gain or power.
That’s what separates businessmen and entrepreneurs. Entrepreneurs work hard to give back to the community, excel at what they do and make the world a better place to be in.
That said, it’s important not to disregard the materialistic perspective as well. For us to bring about a cultural and possibly political revolution, we must first clean our own backyard and rise up to the top of that economic pyramid.
It’s not an easy task to complete and it takes a lot of sacrifices to get there, but hopefully, with these tips, following the examples of the people who did it, you’ll make it just in time.