Here's a great comment (a bit choppy, but still great) left on my post titled U.S. Millionaire Count Hits Record -- You Could be Next:
Let me react on the three steps on How to Become Rich:
SPEND LESS THAN YOU EARN. This simply means earn more than you spend. Follow also the advice of the Richest Man in Babylon: " Part of what you earn is yours to keep." As your income increases your standard of living must remain the same is an advocacy of the Chin Dynasty and it has made millions of Chinese Businessmen Millionaires. Five generations up and five generations down are all engaged in business is also one of the most solid step in becoming rich. Frugality! Frugality! Frugality! and Diversify! Diversify! and Diversify! are always the battle cry of the rich and millionaires. Remember the science of getting rich is not on the lack of income that we have but the foolish spending that we do that make us crave for more money and justify that our income is wanting.
INVEST THE MONEY YOU ACCUMULATE. Money saved without investing it would debase your steps to becoming rich. Invest with a minimum risk in marketable securities, those having stable track records in financial management. Invest in Mutual Funds and it will afford you chances of getting interest income over the periods of time. The time length in portfolio stocks investment would be five years or more anything less than five years would be an unsound business investment venture just as the common trademark in business that it is expected that a business shall incur deficit earning during the first three years of its business operations. Rich people think of investment because that is akin to letting your money work for you and you become its masters while poor people believe that borrowed money would make them live comfortably, hence they become the slaves of money by paying its amortizations and interest charges. Never hoard money at home because idle money and not in circulation is unto a blood not circulating into the mainstream of our bodies.
DO THIS OVER AND OVER AGAIN FOR A LONG TIME. They always say: " Time is money and money is time." Never squander money nor time because they are the two ingredients that will spark riches in ones life. Remember that to become rich we must realize that there will be several downfalls before we will attain that dream. There is always a saying: " A person who has not encountered the bitterness of life's bitter shall never experience the sweetest of life's sweet." We shall never attain richness until we have experienced the bitterness of poverty. Investment plus time coupled with perseverance shall make us rich and millionaire. In the end I will suggest what Benjamin Franklin once said:" Whether we like it or not we will all die sooner or later so let us strive to enjoy life while we can."
Good stuff! This commenter regularly leaves similar thoughts, so he knows what he's talking about!
As you know (or can guess), much of what he's said lines up with my own perspective on personal finances including:
What if your income does not increase? I earn less today in real terms than I did in 1980.
Posted by: Terry | February 27, 2007 at 01:32 PM
As pointed out becoming rich required personal discipline and consistent action. You can become rich by earning more and spending less. Self-made millionaires are frugal than you think
Posted by: jag | March 12, 2007 at 12:39 PM