Creating a life plan: 17 ways the rich and poor think differently


Why is it that some people are wealthy and others not?

You might argue that the rich inherit money and therefore have just gotten lucky. That may be true in some cases, perhaps.

Having wealthy parents certainly helps no doubt but there are plenty of examples of self-made millionaires and billionaires. And there are plenty of examples of people who lost all their wealth and then just created another fortune.

There are also plenty of examples of poor people who’ve enjoyed good fortune on a lottery only to squander their millions within a few short years.

This would suggest that the rich and poor have a different philosophy with respect to creating a life plan and money as a resource.

The video embedded here explores 17 ways in which rich people and poor people think differently. The video is interesting and informative and well-worth a few minutes of your time.

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How to have a healthy relationship with money

How is your relationship with money? Would you say you’re in control of your money or does it all just slip through your fingers the moment you get paid? If it does, you’re not alone.

However unless you learn to manage your money properly you’ll always be poor and your life will always be controlled by ‘The Man’. That is a fact.

It doesn’t have to be like that though.

Develop a healthy relationship with money and you can build wealth over time. Pay yourself first and spend less than you earn and you’ll be surprised at how quickly you begin to accumulate wealth.

Paying yourself first means taking a percentage of your money the minute you’re paid and putting it away somewhere safe. The exact percentage depends of how much you earn and your living costs. However a minimum of 10% would be a very good start.

You can always eliminate expenditure if necessary. For instance you can probably live without those expensive coffees you buy on the way into work or that cable TV subscription that you don’t really need.

In the embedded video Noah Hammond shares his thoughts on how to have a healthy relationship with money.

Though relatively short this video is informative and definitely worth watching if you’d like to improve your financial position.

It is well worth a few minutes of your time and I recommend it to you.

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Money-Making Tips from the 50 Smartest People

Money is important despite observations to the contrary from many people. In the modern age we can’t get by without money, so money-making is something that’s always on our minds.

Ideally we’d all like to have enough money to do as we please. Well it can be done if we invest in things that will in themselves generate an income. If we can generate multiple income streams that’s even better. Which brings us back to the idea of money-making and how we go about it in a way that works for us and leads us down the path to wealth.

As with all things if you want to succeed at something, look around for people who’ve been successful and copy what they do. However where do you start?

Fortunately Tony Robbins has been very helpful here. In the video in this post Tony talks about his book which provides money-making tips from the 50 smartest people. Tony is full of inspiring words and great ideas and I can recommend this video to you dear reader. You can watch it here:-

If you find this video interesting then you may like to add Tony’s book Money Master the Game: 7 Simple Steps to Financial Freedom to your personal reference library.

The book is available from Amazon and you can buy it now if you CLICK HERE.

Alternatively time pressures may limit your ability to give the book enough of your attention so you might consider purchasing the unabridged audio CD version so you can listen to it whilst driving. I do this all the time and it’s an excellent way to use time profitably.

The unabridged audio CD version of Money Master the Game: 7 Simple Steps to Financial Freedom is also available on Amazon and you can buy it now if you just CLICK HERE.

Never underestimate the power of having your own personal reference library and your own motivational resources to inspire you. So go on, choose your format and buy now.

DISCLAIMER: This website is an Amazon affiliate. Should you click on any of the links above and then make a purchase, you should know that this website will receive a small commission. These commissions serve only to cover the cost of maintaining this site. Your understanding is truly appreciated. Thank you.

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25 inspirational stories of people going from rags to riches

Inspirational stories can be so uplifting. They can make us realise that if other people can be successful then so can we.

Did you have a tough start in life? Perhaps you feel that your difficult past will prevent you from enjoying a successful future?

However a tough past doesn’t mean you’re doomed to a tough future.

The same goes for a mediocre past.

The past is the past of course and it can never be changed. Nevertheless is serves only as a series of lessons to be learned not a life sentence.

You can create any future you want, as long as you’re determined, focused and prepared to put in plenty of hard work. You won’t get anywhere without those ingredients. However it can be done, though it is all down to you.

The future is an endless stream of opportunities which you can choose to take or not. Don’t just accept my word, look around for people who’ve actually done it. There are plenty of inspirational stories if you’ll just look for them

25 Inspirational Stories:

In this video included here there are 25 excellent examples of people who had a tough start in life but went on to enjoy considerable financial success.

These are all inspirational stories of people going from rags to riches. If they can do it, why not you?

And remember this; you’re never too old.

Colonel Sanders started KFC at the grand old age of 65. And Ray Kroc began building the business empire we know as McDonald’s at 52.

Believe you can and you will.

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15 Things Poor People Do That The Rich Don’t

Can we learn from the habits of poor people when it comes to money? Yes, when considered against what the rich would not do.

It is a fact that the choices people make will affect the life they experience.

Quite simply our lives are dictated by the choices we make whether we like it or not.

The video in this post  makes some interesting observations about the choices made by people destined to remain poor relative to those who enjoy greater prosperity and the finer things in life.

Now you might feel that some of the observations made here are a little harsh on the less fortunate but actually in my experience the points being made are bang on the money.

So you’d be wise to listen carefully and think about the underlying messages and be honest with yourself.

Just think about it for a minute and I’m sure you’ll agree. We enhance our value by increasing our knowledge and skills, not knowing who the latest fashionable celebrity is dating. Why would that matter to anyone?

Listen, learn and change as necessary. You don’t have to be poor but, if you are right now, then you need to start making some changes.

Nothing will change unless you do first.

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11 Secrets only millionaires know about wealth

If financial freedom is your aim then it would make sense to learn as much as you can about money, wealth and the way it all works. If you’re serious about accumulating wealth then learning is an on-going process because the more you know the better you’ll become as an investor.

So how much do you know about the modern laws of wealth?  Well you may not know much but you can bet that the majority of millionaires will have a solid grasp of these laws. The one thing they all know is how to make money and how to make sure they preserve the value of their capital and make it grow.

As the old saying goes, if you want to be successful find someone who is successful and copy what they do. If you want to be a millionaire it makes sense to me to copy the things that millionaires do. To get you started this video reveals 11 secrets that only millionaires know. It’s well worth your time and I can recommend it.

If I’ve whetted your appetite for mastering the game of wealth-building then you might want to start reading a few books on the subject. In fact it would be a good idea to purchase your own small library of reference books on money matters which you can then dip in and out of as necessary. One book I found truly inspiring was Secrets of the Millionaire Mind: Think Rich to Get Rich by T Harv Eker.

If you’ve ever wondered why some people achieve wealth effortlessly while others work just as hard but struggle financially then this book is for you. It explains how to master the game of money so that not only will your financial success be achieved but it will show you how to ensure your wealth is retained once you have it.

This book will provide you with insights that will help you take action to transform your financial self, quickly and permanently. It offers dozens of high-income and wealth creation strategies that you can use. Read it and you’ll learn what wealthy people know that others don’t. It sheds light on the cause of almost all financial problems. It even explains how to earn passive income, so that you could be making money even while you’re sleeping. Now how good would that be?

If you’d like to develop your own personal money and financial success blueprint then I recommend you purchase this book. It is available from Amazon and you can buy it here now.

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How to Save Money: 10 Tips to Boost Your Wealth

How to save Money? That’s a question we all ask occasionally. Certainly it’s one to ask if achieving financial freedom is your aim.

Do you have problems saving money?  Does your salary disappear long before your next pay day? Do you experience too much month at the end of the money? Certainly it’s a good idea to put some of your money away each month in order to build a capital sum for the future.

However, that’s easier said than done I can hear you say. How can anyone save money nowadays? That’s a question most people ask frequently.

It isn’t easy but it can be done and it requires determination and financial discipline.  Some people do it, so why not you?

Working for someone else is unlikely to make you rich but, if you have an income, it can provide you with the basis for building wealth. It’s not necessarily about becoming rich. It’s simply about building a capital sum over time which might make your life easier when you’re in need of a large sum of money in the future. That might be to purchase a property when you’re getting married or perhaps when you decide it’s time to retire.

The key thing is to start as early as you possibly can. The earlier you start the more you will benefit from the magic of the compounding effect.

So here are 10 tips to help you start saving your money:-

Tip 1: Pay Yourself First

Each month when you get paid take a percentage of your income, say 10% or whatever is reasonable, and put it away somewhere safe. It will be a bit like tax and other stoppages. Once it’s gone, you get used to managing on what you have left. If it goes at the beginning of the month it’s gone and it’s safe.

Do this each and every month and over time your savings will start to grow faster than you think.

Tip 2: Don’t let expenditure exceed income

Money comes into your hands and then money goes out. You have to make sure that you don’t spend more than you earn. And don’t spend money on stuff you don’t need and probably won’t use.

Tip 3: Make a Budget

Create a budget to cover your basic expenses plus your discretionary expenditure. Limit your discretionary expenditure and stick strictly to your budget. Manage your money properly and you should have something left at the end of the month.

Tip 4: Reduce your expenditure

How often do you buy that expensive coffee on the way to work? Cut out the coffee from Starbucks and the saving over a year can be substantial. If you buy expensive sandwiches from the Deli at lunchtime then you could make another saving by making your own sandwich and taking it to the office with you. ‘Brown bag’ as the Americans say, and that saves money. Again over time the savings will add up.

Tip 5: Ditch the Credit Card

Credit cards can be a convenient means for paying. However they can also be weapons of mass wealth destruction. For a start research studies have shown that people who use their credit cards as a means of payment for every purchase tend to spend more money than people who use cash on average.

Similarly with a credit card it is so easy to spend money you don’t have on things you don’t need both in shops and online.

And if can’t settle you credit card bill in full at the end of the month you’re left with debt and interest payments at extortionate rates. That debt can easily grow to levels which then become difficult to control.

Ditch that credit card and you’ll probably save a lot of money over time.

Tip 6: Downgrade your accommodation

Could you live in a flat or apartment rather than a house? If you live in a big house could you live in a smaller one?

Your lifestyle choices can prove to be expensive. If you want to reduce your expenses then downgrading your accommodation is one way of doing it.

Even a small downgrade can produce a saving which could help in your goal of building a capital sum.

Tip 7: Live without a car.

In some ways life can be easier when you’re mobile. However it comes at a significant cost.

In addition to the capital cost of the car, there is depreciation over time plus the cost of fuel, insurance, maintenance, parking and wear and tear.

The cost of motoring can be high indeed. If you could make do with public transport then you can save a lot of money.

Tip 8: Use Discounts Coupons and Codes

We’re frequently given discount coupons and discount codes but how often do we make full use of them?

Such savings individually may not seem like much but the cumulative effect of this approach can save you a lot of money over time. Never be embarrassed to used discount coupons and codes. Take every opportunity to make savings on your purchases.

Tip 9: Spend Your Money Wisely

How often do we spend our money on stupid stuff? Things we don’t need and/or will never use. Before you buy ask yourself, “Do I really need this item?” and “Will I actually use it?” If your answers are in the negative, or even just probably negative, then don’t waste your money. Save it instead.

Tip 10: Take advantage of tax breaks

Take every opportunity to benefit from tax breaks. Tax evasion is illegal of course but when there is a genuine and honest opportunity to save tax then you should always take advantage of it.

Overall this list of ten tips is by no means comprehensive but these tips will help you save if you are disciplined in your approach to managing your money. So what are you waiting for? Get serious about saving your money now.

If you want to improve your knowledge on how to save money, there are some great books on the subject. Start your financial education right now and buy yourself a couple of decent reference books. And read then, frequently.

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What’s the difference between saving and investing?

What’s the difference between saving and investing? A friend recently asked me this question and I thought it was interesting because most people appear to view these terms as two words for the same activity. However this is definitely not the case.

Savings:

Essentially saving is the money you manage to retain from your earnings each month, which you then keep in the bank on deposit. Either this money is surplus to your needs or it is a sum which you have proactively taken from your earnings at the beginning of each month in order to ensure that over time you can begin to build a significant capital sum. If you’re adopting such a proactive approach to saving then give yourself a pat on the back. However, even when money is on deposit, you should be seeking the best interest rate you can find.

Investing:

If you are saving regularly then over time you will start to build a significant sum of money and that’s when you can start thinking about investment. The point of investing is to enhance your wealth; to turbo-charge it if you like. To ensure that your hard earned money works for you and grows over time such that it keeps pace with inflation and attains a high enough rate of return to provide you with some capital growth.

Conclusion:

Investment is a serious approach to managing your wealth, spreading risk and diversifying over various asset classes. Being a saver is good; being an investor is even better.

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Why discretionary spending with debt is a bad idea

Never use debt to fund discretionary spending.” ~Roy Sutton

When you’re young you really want to enjoy life, right? That’s perfectly reasonable, surely? You’re fit, you’re healthy, you’re full of energy and there will never be a better time than now to enjoy yourself. If you can’t enjoy yourself when you’re young, when can you enjoy yourself?

If you’re lucky enough to have lots of money then good luck to you. Live life like there’s no tomorrow. The problem is most people are not quite so lucky. Most people are constrained financially, at least to some degree.

Equally for most young people, earnings are quite low when they start out on the road to independence and there are bills that can’t be avoided.

Everyone needs somewhere to live. We all need food to eat. We all need heating and lighting as well. Then there are all those taxes and municipal charges that must be paid too. So for most people there’s probably not a lot left at the end of the month for discretionary spending.

The temptation then is to borrow money so you can have a good time. Going into debt to fund discretionary spending is a really bad idea. So don’t be tempted.

Spend money you don’t have on anything that is not absolutely essential and you will be on the road to the poor house.

Some things you cannot live without. For instance if you want somewhere to live then you’ll probably have the need to buy a house. Unless you’re a millionaire, buying a house will mean a mortgage which is a form of debt. However that is good debt in the sense that you’ll be buying a home which is also likely to be an appreciating asset. So on that chances are you won’t lose.

Interest rates on mortgages are low because the mortgage provider will secure the debt against the property. You fail to pay and they’ll take the property. In this case risk for them would be low, so that is reflected in the interest rates charged.

Debt for discretionary spending is quite different. That will be unsecured debt and so interest rates on that debt will be very high. If the debt is on a credit card then chances are you’ll be paying in excess of 30%. If the debt is in the form of a ‘payday loan’ then interests rates can be anything from 1,000% to as much as 4,000% or even more. Even a small loan can quickly become a massive debt due to the effect of compound interest.

If you’d like to take a holiday or buy a car or have a party or buy the latest electronic gizmo, then save up for it first. For items like these, you only buy once you have the money in the bank to cover the cost.

Debt when it is unsecured is always very expensive and once you get sucked into a large debt hole it can be a real struggle to get out again. Debt enslaves you; it is stressful; and it will keep you awake at night. The pleasure you might get from discretionary spending can quickly turn into a nightmare if it results in debt.

Getting into debt is easy; getting out again can be both difficult and painful. Don’t allow your better judgement to become clouded by your desire for a little pleasure. Everyone wants to have fun but don’t make the mistake of getting your kicks with money you don’t have.

However big the temptation; you will regret it later. Debt is a burden.

That of course is one opinion. What do you think? Your ideas and stories might help other people, so feel free to comment.

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Dealing with debt and curbing your overspending

Do you struggle when dealing with debt? Perhaps you’re looking for ways to curb your overspending. Certainly the burden of debt can be stressful. Surely life would be easier if you could find a way to reduce your debt burden? The problem is where do you start?

If you’re serious about dealing with debt then a good start point is to take a close look at what you’re spending. There are things you must have like a roof over your head, heating and light, and food on the table. Then there are those things you buy that you really could live without. Even for things you must have you can often overspend on these items in you’re not careful.

It is a fact that overspending is one of the main reasons why people get themselves into debt. You’re in the shopping mall or on the internet and you see something that is so tempting and you can’t help yourself. Buying is so easy with your credit card and so you do without considering whether you really need it or whether you can truly afford it.

Well that’s a habit you must change if ever want to be in control of your money and your life. Yes, it is a hard habit to break if it’s been part of the way you live your life for so long. That’s understandable but it’s not impossible. It can be done and it’s an important step on the road to dealing with debt.

So here are a few simple steps to help you to stop spending, start saving and live a life geared toward achieving financial freedom.

1. Admit you have a problem

The first step to curb your overspending habit is to admit that you have a problem. You can’t eliminate a problem until you recognize you have one.

Once you admit to yourself that you have a problem then you need to understand where your money is going. Unless you make a point of identifying where your money is going then it will simply disappear without you knowing where it’s gone.

Keep a journal to record your spending on a daily basis to keep track of everything you spend. Write it down and at the end of each week review what you’ve spent and where your money has gone. You might find that this is a real eye–opener for you.

With this approach you will be able to see what you’re spending on stuff that may not be absolutely necessary. Then it will be easier to develop a clear and concise spending plan whereby you start living within our means. Having a plan can then be the basis by which you start developing the self-discipline to allow you to break your overspending habit.

2. Make financial goals

In developing your spending plan you must also set some realistic financial goals for you and, assuming you have one, your family.

One goal should be to ‘pay yourself first’. What does this mean? It means as soon as you get paid you set a small proportion of your income aside immediately. You could set aside say 10% of your income. That can be used to reduce your debt burden initially and later, when your situation has improved, for savings each month.

By setting money aside when you get paid, it’s a bit like taxes and other deductions against you pay. They all get taken off and you get used to living on what’s left. Putting something aside is an important part of any personal financial spending plan.

Keep your financial goals in mind each and every time you’re tempted to make an impulse purchase or overspend on something you can live without. This will encourage you to make better spending decisions.

And when you’ve reached one of your financial goals, don’t forget to give yourself a little reward. Don’t go overboard of course but achieving a goal will make the reward all the sweeter and it will encourage you in the development of good money habits.

3. Cut up your credit cards

Credit cards can be a convenient medium for making payments but they can also be weapons of mass wealth destruction. When you have a serious debt problem don’t take a credit card out shopping.

Yes, they are a big part of today’s culture and it is might seem hard to imagine life without one. However studies have shown that people spend a larger amount when using a credit card because it doesn’t register with them that they are spending real money. And that’s why they are dangerous.

Essentially using a credit card is simply postponing the inevitable. It is actually real money and eventually the bill for your purchases will have to be paid.

So take the impulse out of shopping and start planning for purchases ahead of time by saving up the cash. You will be surprised at how much you save by not using plastic.

4. Seek out support

When you’re trying to break a habit, it is important to surround yourself with good people who will encourage you and steer you in the right direction when you’re tempted.

That means when you’re going shopping make sure you take someone with you who’s not afraid to remind you that you don’t need whatever it is you’re thinking of buying. Someone you trust who will be your conscience, if you like. Someone who knows your aims and will help you achieve them.

If there is someone who will hold you accountable for your actions, who forces you to recognize your bad habits then this will make your financial goals much easier to accomplish.

5. Take up a hobby

Our shopping habits often stem from the fact that we are simply bored. This is particularly true with shopping online. You’re sitting at home bored so you pick up your iPad or similar tablet and start browsing. Sites like Amazon are very good at closing a sale once they’ve got you. It’s all so tempting. And we’re all guilty of impulse shopping on the internet, at least to some degree.

So next time you’re bored, find something else to do. You could take a walk, go to the gym for some exercise, watch a film, read a book, you could set up a blog and share your thoughts with the world or perhaps just volunteer to help a charity. There are plenty of other possibilities, so just do something other than shopping that appeals to you.

In short, take up a hobby or two and keep your money in the bank.

Conclusion

This is not an exhaustive list but these few tips should help you to curb your overspending and develop better habits with money. If you change your ways you can start winning with money.

Don’t try to ‘boil the ocean’ just take small steps on a daily basis and this will help you kick your impulsive shopping habits. You need to start thinking about where your money is going and where you’d like it to be.

Start today and you’ll be a smart shopper in no time. With a little self-discipline you can go from being a complete spendthrift to becoming a super-saver quicker than you ever thought possible. Become a super-saver and one day you will achieve financial freedom. Achieve that and your life will be a lot sweeter and a lot less stressful.

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