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A lot of people posting a counter argument to this list have presented the argument well the wealthy can do item X on the list because they have the money and time to do so. That’s basically what VM1138 was saying. You’re missing the entire point of the list. Wealthy people got to where they are because of certain traits they developed and continue to live life by practicing those traits. It’s completely irrelevant that they are rich NOW; even when they weren’t they did things this way.
This list isn’t about habits that will guarantee you will be rich or poor. It’s about habits that increase your chances exponentially of either being rich or staying poor. Ramsey gave a list of things people do because its easier for people to connect to example’s of daily actions then simply listing traits.
I will break down certain traits he was referring to. Rich people who became rich (not inherited) are USUALLY more responsible, orderly, plan for the future, willing to forego instant gratification, always seeks self improvement, hardworking, prefer's to know how something work’s whether they plan on doing it themselves or having someone else do it and possess self discipline.
Poor people who STAY poor are USUALLY irresponsible, disorganized, plans for tomorrow, wants instant gratification, think they know everything so they don’t try to further their education, lazy, prefers someone else to do things they haven’t already learned to do and have poor self discipline.
This. People who are struggle economically have this weird assumption that people who are wealthy did not struggle for large stretches of their lives. Unless someone inherited huge bags of cash, nothing could be further from the truth. I guess they need that rationalization.
Hey, when I started my business twenty years ago, we fought long and hard to keep the wolf from the door. I remember the time we managed to score free baseball tickets on our anniversary, scraped together enough money to buy Natural Light beer and a bag of peanuts at the grocery store to save money, and smuggled them into the game in my wife's purse. That was our big night out that month. To this day, I cannot even look at Natural Light in the grocery store. It tastes like poverty, identical to how I'd imagine mule urine would taste.
We watched our household expenses like freaking hawks. Rather than buying our furniture on credit, we scrounged garage sales and refinished it. I changed our own oil. My wife and I dry-walled our basement with the help of her dad. In the worst year for my business, I brought home a grand total of $6,000. I still don't know how we made it. But I know what we didn't do: We didn't eat out. We didn't drive anywhere it wasn't absolutely necessary. And we didn't spend money we didn't have.
The thing is, a lot of those same disciplines still hold in our daily life. When we bought the house we currently live in, the mortgage officer asked "Why are you buying such an inexpensive house? You could afford a house three times this price." We ignored him. A year later, the real estate market crashed and many of those people who borrowed to their limit were foreclosed on. We still shop at Costco on the bulk purchases, and know when it costs less to clip coupons and shop at our grocery store down the street.
Speaking of, I'm not as hard-core as those people you see with binders full of coupons at the store, but I did shave about $30 bucks off the grocery shopping last week along. $30 a week is $120 a month, $240 in pre-tax income, which is essentially our electric bill. Would you clip coupons in order to not have to scribble out a check to the electric company? For that is tantamount to what you'd be doing. That same $30 a week is $1600 a year, which is $3200 in pre-tax income. Would you clip coupons if someone handed you $3200 a year to do it? If so, what's the difference?
I mean, we're not total skinflints. We eat out once a week now. We always take a killer vacation with our kids (Last year it was Colorado and Wyoming. This year, it's 10 days in the Pacific Northwest. But not on credit cards). But those are the exceptions in our lives, not the rule.
On the other end of the scale is my sister. She married an attorney and earned her MBA from a really good school. But because she is a slave to her appetites, she's thrown away every dime she's ever made on her whims of the moment. She was always running off to the beach, always going out to party with her friends, always buying the newest, latest and greatest. She got bored with my nice but stolid brother-in-law and divorced him, only to blow what was left in equity from the sale of their house on a convertible. It didn't help that she walked away from every job she ever had when the going got tough. I just learned last week that she has borrowed so much money from my elderly mother that my mother had to get a second mortgage. Ask me how I feel about that. Today, my sister is in her late 50s living hand-to-mouth selling insurance.
Now the live-for-today crowd would say my sister has had more fun than me. Maybe, but I don't think so. Because we've had plenty of fun in our lives, accumulated a wonderful set of friends, and don't regret a single second of our lives. But that's really not the point of this thread. My wife and I have scrimped, clawed and sacrificed to gain our prosperity in life through hard work and smart decisions that became daily habit.
We watched our household expenses like freaking hawks. Rather than buying our furniture on credit, we scrounged garage sales and refinished it. I changed our own oil. My wife and I dry-walled our basement with the help of her dad. In the worst year for my business, I brought home a grand total of $6,000. I still don't know how we made it. But I know what we didn't do: We didn't eat out. We didn't drive anywhere it wasn't absolutely necessary. And we didn't spend money we didn't have.
The thing is, a lot of those same disciplines still hold in our daily life. When we bought the house we currently live in, the mortgage officer asked "Why are you buying such an inexpensive house? You could afford a house three times this price." We ignored him. A year later, the real estate market crashed and many of those people who borrowed to their limit were foreclosed on. We still shop at Costco on the bulk purchases, and know when it costs less to clip coupons and shop at our grocery store down the street.
Everything you wrote in your post is applicable in my situation. I grew up in poverty where my father supported a family of 4 on an income of 12K-16K/yr depending on how many hours he got at work that year. Although we were poor it was because he ran into horrible luck that led him to that situation. But he possessed many of those traits that I listed that the rich practice and he passed them on to me.
Using those traits now I live a lifestyle that most are envious of. But I still practice those same principles just like you. I NEVER buy on credit, I never over extend my budget, save/invest plenty for retirement and I never pay someone to do something that I can do myself.
I want to give two examples to show people just how powerful educating yourself throughout your life can be. Last year because of certain tax benefits being taken away my accountant informed me that I would get back significantly less. This is a top tier accountant that I handpicked out of many because he was so good at finding all the tax cuts that most accountants don't.
Up to this point I never took too much interest in learning in depth about the US tax code. But this smaller returned angered me enough to where I literally started studying the tax code to see if I can find any loopholes to get back more money. 7 hours later I had found enough LEGAL loopholes to get back an additional $3700. That’s the equivalent of earning $528/hr!
Another example is my house expenses. The first time my roof leaked I decided to learn how my roof works before I called a contractor. Long story short all (4 different contractors) quoted me a price between $2000-$6000 to fix that roof. Because I knew enough to know that all their prices were BS I said no to them all. I found one honest contractor who charged a fair price of $750. So right there I saved at least $1250. Basically that’s like earning another $1250 for just a few hours of research.
So after that roof incident I decided to learn even more about my roof including how to build it. Long story short, the average price to replace my roof would be about 30-35K. But I learned enough to know that most of the cost is in marked up material. So I found out where I can get all of it from the distributer for cheaper and only pay the contractor for labor. Now my roof would cost only 15K to replace. And since this is an inevitable house maintenance cost, I just saved myself 15-20K in the future that I can invest.
So for those that think having certain traits don't increase your chances of becoming rich, just look at how much money I save/make just by practicing one of those traits. There are literally hundreds of other examples of this "ongoing education" trait that I could give. So when you add this along with other traits that are listed it’s easy to see how this can lead to someone becoming rich.
One other thing. People who really succeed understand the value of two finite things: Time and money. As a result, they tend to waste neither.
Somebody earlier spouted the tired wheezes, "Well, who has time to exercise?" and "Who has time to get up early?" Well, everybody does. It's a matter of choosing one's priorities.
Let's start with the biggest time suck of all -- Your television. At least the Internet is a useful tool to know what's going on in the world. Meanwhile, if you flip on the idiot box every night for four-five hours, then you are nothing more than a passive consumer of entertainment. You have decided to expend 25% of your waking hours watching glorified, predictable soap operas with nothing to show for it but maybe a conversation opening in the break room the following day. To be sure, there are things I watch. But when I finish watching a program, I turn it off and think about what else I can be doing with my time.
I mean, the average white collar professional has a lot less free time than the average blue collar worker. Study after study shows the disparity between how much the two groups spend on the job.
03-06-2014, 10:27 PM
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n/a posts
what's the obsession with being rich about?
i bet i'll be just as wealthy as anyone when we're both dead.
say what you will about death...the best thing about it is that it's the final equalizer.
i bet i'll be just as wealthy as anyone when we're both dead.
say what you will about death...the best thing about it is that it's the final equalizer.
just enjoy life in the meantime, i say.
Thanks for that Philosophy 101 moment, but it was really a pointless observation on your part.
Being prosperous isn't an end to itself. It isn't about the huge mansion or the automobiles or any of that stuff. It's not about accumulating possessions. My wife and I live in the most modest house on our street. She drives a ten-year-old minivan while I drive a base model Jeep Wrangler. Wealth is about what prosperity provides. Security is one thing. The freedom to do what you really aspire to do is far more important. So actually, what we're talking about increases the ultimate enjoyment of life, not diminishes it.
In fact, let's subject you to this quiz: If you could do anything you wanted, what would it be? I bet travel would be a big deal. Or becoming seriously proficient in an instrument. Or pursuing an artistic endeavor. Or writing the novel. Or sailing the Pacific. Yet almost all those things require a large degree of financial certainty in order to do them well. It's very hard to become good at a musical instrument or write a novel if you're working two jobs. And it's really hard to see our amazing world if all you've got is two weeks of vacation a year. And that's being single. Have a couple of kids and you'll really know what pressure is.
When my last child graduates, my wife and I have plans to live abroad. I'll be able to undertake creative pursuits that just aren't in our scope right now simply because of time. If all goes according to plan, we're looking to retire in our late 50s. In other words, rather than schlepping it to a job until we're in our 70s, we'll be able to do what we want. We won't stop working. We'll just be working at the things we enjoy the most.
That's the point of this. Freedom and security. Attaining the top of Maslow's Hierarchy of Needs is a lot harder to do when you're pulling ten hour days well into your 60s and barely making enough to make ends meet.
CPG and Griffon, I'm in the same club as you: the formerly poor. And there are millions and millions of us. Our existence is an affront to all who blame their problems on others.
For all I know the stats came out of his arse. While it is true that behaviors and mindset play a role in your personal and professional development, sometimes it can only get you so far. What conditions you were born into (an orphanage? to drug addicted parents?) are an even bigger component of determining your fate in life than these 20 "things".
For all I know the stats came out of his arse. While it is true that behaviors and mindset play a role in your personal and professional development, sometimes it can only get you so far. What conditions you were born into (an orphanage? to drug addicted parents?) are an even bigger component of determining your fate in life than these 20 "things".
Oh yeah, right, because if you were born into an orphanage, twenty years later you are forced to watch TV all night instead of read a book.
Oh yeah, right, because if you were born into an orphanage, twenty years later you are forced to watch TV all night instead of read a book.
I'm sure the children in Indian slums will understand that "reading books" will be the winning ticket out of poverty.
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