We all aspire to one day be wealthy enough to not have to worry about deadlines and bills. The people who live without these added stressors are considered the uber wealthy. Robert Kiyosaki, author of Rich Dad, Poor Dad, is one of these uber wealthy people and in his book he gives advice based on his own experiences on how to achieve this kind of wealth.
In this article, we will review 3 of the lessons in his book that could potentially help you to become the richest you could be. Who wouldn’t want these types of tips from an actual millionaire!?
Save! Save! And Save Some More!
If you are really serious about improving your wealth, you should be saving more money than you are spending.
One of the fundamental obstacles to becoming rich for most people is budgeting their spending. You should choose to spend as little money as possible after figuring out what you have left in your budget. For example, if your net household income was $2,000 per month. After paying off all of your necessary expenses and buying a few unnecessary (but fun) items, you might have $100 left to put into savings. That means you are putting 5% into your savings each month. That is a good way to start saving some extra cash. This can come in handy for unexpected expenses, but when there aren’t any, you can continue saving.
Though many financial planners would recommend the average person save and invest 10% or 15% of their income regularly (less if you have a smaller income), the aspiring rich can save as much as 30-50% of their income per month. This extreme savings strategy would require minimum spending, which not everyone can afford. So, this strategy, if done, is usually temporary.
If you want to really increase your saving though, you can always invest in high-interest savings accounts. That way you can keep putting money into your savings while your money simultaneously grows in the account. Nice, right!
Don’t Work for Money; Make Money Work For You
When it comes to making money, people often tell you to get a job, and that can be an effective way to make money. For younger people, having a stable income in the form of a job is a great idea, but it’s not going to be the easiest way to build wealth. If you have nothing else to offer, offering your services to a job can be a great idea. Though, the majority of wealthy people in the world don’t usually rely on these service jobs as their only source of income for their entire lives.
The main difference between the wealthy and the poor is that the wealthy become the employers that hire people to work in these service jobs.
The wealthy know that to make real money they need to hire and not hold jobs. By contrast, the average person usually spends their lives working a job in the service industry. The idea that a job is the only way to make money is how you become trapped. Then you end up working that dead-end job for the rest of your life.
One way to make your money work for you is to become a business owner. Running a business is all about learning how to use resources and people to earn more money than you could ever imagine while working a typical job. For instance, business owners can lean more on their talents and skills than the average worker. Once a business begins, the owner can either hire others as employees or use subcontractors to do the work that makes them all their money. The business owner is basically there to make sure things move smoothly. The good thing about owning a business is that as your business makes more money, you can invest some of that money into building your business and increasing your income.
Using money to make money is the best way to increase your wealth.
Working for Other People Sucks!
It’s not necessarily a bad thing to work for someone else, but it can lead to a hard life of financial struggle for most people. The worst part is that when you’re an employee, the phrase time is money can never be more true. And since you are limited in the time you can give to your employer, it limits how much you can earn too.
Not to mention, you will always put in more work than you are getting paid to do. An example of this is when you’re at work making $50 an hour in revenue for your employer, in reality you only earn $25 for each hour spent. It’s like that because your employer cannot afford to keep you on the payroll without making money off of your work.
There are also limits to how much you can make in a given position, regardless of if the quality surpasses your pay-grade. For instance, if you work in an occupation where the pay range is between $40,000 and $65,000. Even if you’re exceeding expectations in your job, you’ll most likely never make more than $75,000.
On the other hand, if you created a business for the general public, you’d earn a lot more than your previous hourly pay. And as your business grows, you can earn more money. Remember, money can work for you too.
Being self-employed, there is no limit on what you can earn.
Plus, the more you earn, the more you can save and invest to build your wealth.
Not only does self-employment remove any income ceilings, but it also creates the ability to build up your wealth faster than if you were an employee.
Do You Wanna Be a Rich Dad?
I’m not suggesting that you find a partner and raise a loving family. However, I do think you should spend time considering the lessons in this article and find ways you could apply them to your own journey to wealth. That way we can all be Rich Dads!
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