Wealthy people are not wealthy because they were born on Mars. They are so many statistics showing how wealth is unevenly distributed and in the hands of the minority. There are many reasons, but I think a reason largely ignored is how wealthy people do things and think about things (Click to Tweet this thought). Here are four things I challenge you to start doing to think wealthy.
1. Start Creating Income vs. Creating Expenses
You can use new opportunities or new information to do either. For example, there are different reactions to the new lending rates that have been proposed. Having sat with various people in several discussions, I can see that there will be outcomes in people’s lives as a result of the same bill. Some of the conversations have been around how it will be easier to borrow for things like cars, go on fancier holidays and lifestyle-related issues. There are people who are reconsidering the car they wanted to buy because on a basic calculation they can now buy a better car. A young man mentioned to me that maybe he can now consider the Subaru as opposed to the smaller Toyota he wanted to buy.
On the other hand, there are others who are now thinking about the investments that they can possibly make; thinking about the impact on mortgages for properties, businesses that can be expanded etc. The same information, same credit; but different ways to utilise it. This credit can become a bigger expense to you or a way to generate income. Far too many people think about spending and get dazzled by it. I really don’t notice wealthy people going out of their way and wasting time commenting on people’s cars on social media. We have an unemployment issue because there are less people creating jobs than seeking them. You decide who you want to be, a wealth creator or a spender; the two cannot compete.
2. Plan with Future Resources in mind, rather than Limiting your Planning to what you have now
When businesses raise capital, they obviously have to have a plan as to how they are going to spend that money. They don’t wait to have the money first and then plan. I have worked with couples who sit down at the beginning of the year to map out their investment strategy. For example they decide to work towards a certain investment or raise money for a certain university they want their kids to go to. They don’t have the money there and then, but creating the plan helps them stay in the mind-frame to figure it out. You can’t achieve that which you are not actively thinking about. You’ve got to see the tree before you start watering the seed. You want to earn more and then plan to earn more, rather than the norm of waiting to first be guaranteed of it before you take action.
3. Use your Money to Make more Money
What portion of your spending goes towards efforts to make money? I have given talks to several investment groups (chamas) over the last couple of years. It has always fascinated me at how many times these chamas will argue over the fees charged and many even try to get away without paying, yet they want to be taught about money and how to generate wealth as an investment group (Click to Tweet this thought). That doesn’t make sense. If you are in a Chama, you also know the disputes that people have whenever the subject of contributions comes up. People will argue over the proposed Kshs 5,000 increment to monthly contributions and then go and spend that same amount in the bar that same night.
I’ve noticed that wealthy-minded people will use the right advisors or consultants and will not unnecessarily squabble over paying to gain. You cannot have this scarcity mindset if you want to generate wealth. You may need to spend money to access the information, get plugged into a certain network, learn about a certain investment, upgrade your business practices etc. The cost of you not spending money is usually more expensive. Many entrepreneurs have learnt that hiring the right people who may be a tad more expensive is actually much cheaper in the long run, than having the wrong person. How many people have been conned in property transactions simply because they didn’t want to work and pay the right professionals? One of the most common things people say when they take the Centonomy programs is how they wish they had learnt these money principles earlier. This is because they are now aware of the time and money wasted by doing the wrong thing. The next time you get an opportunity to move forward, don’t waste it because it will cost you some money. Wealth Creation is not free. Be willing to be uncomfortable in the short term for longer-term benefit.
4. It’s not all about you
You will really limit yourself when it’s all only about you and even only about your immediate family. If more people were to look outside themselves and try and impact even one or a few people, the better off we all would be. This could even be the person who takes care of your house and children when you are at work. What change is happening in their life simply because they worked for you? I’ve noticed that truly wealthy people are very generous. This doesn’t mean they carelessly give everybody who asks, but they want to achieve some sort of impact with what they have. They are more concerned with legacy, than with displaying their material possessions. This generosity doesn’t suddenly start when you are worth millions. It starts now with what you can. It doesn’t even have to be money. It can be time. Giving puts you in a much needed mind frame to create wealth. If you believe that you lack, you can’t be wealthy. Giving helps you remember what you have and that attracts more into your life. Just taking care of yourself and ensuring only your own comfort cannot be your biggest achievement.
To learn more about Personal Finance Management: debt repayment, saving, wise spending, investing, financial growth and much more, click here to learn more about the Centonomy 101 program.
Waceke Nduati-Omanga runs programs on Personal Finance Management, Entrepreneurship and Career Success.
Find her at waceken@centonomy.com| twitter @CekeNduati| Facebook /CekeNduati
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