Money | Psychology | Life Lessons
Lessons To Make Money and Build Wealth Regardless of Where You Are in Life
Making money is a skill that will take some time, but with practice, you will become an expert.
I grew up with almost no money. My father was a farmer and a police cop. We had the necessities of life but no TV, Phone, or car.
Being a skinny kid with a tall frame, I showed interest in studies in a village where no one, absolutely no one of my age, ever went to school after 8th grade.
I was always interested in how people make money, how someone has too much and someone has almost nothing. The following questions always bother me.
Why is a person sitting in an air-conditioned room making way more than a person who is sweating all day doing mundane jobs?
Why a rich person is getting rich every year?
I knew a realtor in our neighborhood who never went to school but was adding pieces of land each year in his protfolio.
Why does a person need billions when you can happily live with merely 0.005% of a billion?
I started to learn. Trust me, learning is still going on.
Books
Articles
Magazines
Personal finance gurus
Reddit discussions
Personal discussions with rich people
Quora answers, you name it.
Trust me; I lost a lot of money while on the quest to learn the importance of money and why I need money.
However, the journey has been incredible.
In this article, I’ll share what I learned, and I also believe learning is a continuous journey.
Continuous learning is the minimum requirement for success in any field. — Brian Tracy
I would love to read about your journey; please share in the comments what’s working out for you.
I am always up to learn more.
However, along the way, I picked up lessons that completely changed my perspectives on money, especially personal finance.
If you want to live happily and debt-free your whole life, you just need my grandma’s rule about personal finances.
Don’t spend more than you earn!
That’s it.
I keep adding more ways to earn.
More than one source of income is needed in this modern and constantly changing world.
Consider money a tool, not an ultimatum to happiness, especially health.
I think everybody should get rich and famous and do everything they ever dreamed of so they can see that it’s not the answer. — Jim Carrey
Implant this concept in your brain that money is a tool, not an ultimatum to happiness.
Before moving to North America, I used to think making $1000-$5000 was a huge amount of money.
All I need to do is find a way to make $5000 per month to live a happy life.
Now, I make much more than that, but it’s like a never-ending journey.
Yesterday I read the following tweet, which solidified my concept that money is never enough and everyone has their own number, which is continuously increasing.
Now, I use the money to find extra time.
Sure, it can provide comfort, security, and the chance to chase our dreams, but it’s not the be-all and end-all thing.
Money alone cannot give you long-lasting happiness and peace of mind.
Focus on forging strong relationships and optimum health.
Master this magic trick to earn more without doing work for money.
Compound interest is the eighth wonder of the world. He who understands it, earns it… he who doesn’t… pays it. -Albert Einstein
Compounding is the key to making a lot of money. Start tiny, but invest regularly.
Let me share the story of a janitor who amassed $8 million on a minimum paycheck.
Ronald Read, a Vermont-based janitor and gas station attendant, died at 92 in June 2014.
Read amassed $8 million by following two fundamental principles of personal life.
i) Don’t spend more than you earn
ii) Let’s compounding do its magic in the long run
I’m sure if he (Ronald Read) earned $50 in a week, he probably invested $40 of it. -Mark Richards
He donated most of his wealth to the library and hospital. You can read the full story here.
Get your financial knowledge game to the next level.
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How?
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Develop a mental model of what you want to achieve in the long run.
There is no shortcut to get rich.
I am not talking about Ponzi schemes or getting extremely lucky. That’s a zero-sum game, and in the case of winning, to see someone is losing is a pathetic way of thinking to get rich.
Let’s say you are investing in stocks.
By staying up-to-date, you will be able to make better decisions to invest in great (financially strong) companies.
Take action to start living below your means.
This should be your first principle to make more money.
It’s the Golden Rule to get financial independence.
Let me recall the example of Mr. Read, who acquired $8 million overtime by using this principle of spending less than he earns.
Diversification is the key to growing your wealth.
I must say when you make some money, it’s important to learn the concept (power) of diversification.
Did you ever hear?
Don’t put all of your eggs in one basket.
Diversification is the key to managing the risk factor when you start building wealth.
For example
- S&P 500 (Allows you to buy into a portfolio of 500 companies in the USA)
- Dollar-cost averaging
- Know when to buy or sell
Do not ignore this NOTE.
Only put something in the S&P 500 or even save if you are making more than $75,000 a year. If you are not making more than $75,000, put that extra money into high-income skills instead of saving and seeing your portfolio crawling; invest in yourself and double your income in the next couple of years.
Trust me, if as an immigrant (English as a second language, no connections in the country, etc.), I can do it, and you can do it.
Keep boosting your income until you hit your target money.
The best way I learned to boost my income is by investing in myself.
Reread the previous step once more — do not ignore this note.
As said in my previous article (here), don’t worry that you are wasting money on gym membership if it’s improving your health.
I actually used to have a $100 per month budget to buy books or learn courses to boost my income. Now its unlimited, I buy books, seminars, and/or anything which I truly belive is going to hep me to achibe my next goal. I jump on.
Most of the time, those seminars, and workshops are worth nothing, but there is a time when that one person you meet at a seminar or workshop changes your perspective, which compensates for all the losses.
Stay positive and keep investing in yourself.
That’s the best way to broaden my perspectives and bring more ideas.
That’s how I started a writing side hustle, and I can literally live on just writing.
However, it’s just another source of income.
When you have enough, be generous.
When you start making money, don’t ever say no to the underprivileged.
Trust me; it’s really good for the people in need.
It is also great for your mental health. Helping someone is healthy because it can cause an increase in serotonin, a neurotransmitter that helps regulate your mood.
Make a conscious effort to find ways to donate a portion of your income to society.
For example
I love to spend time outdoors.
Therefore, I love to donate to upgrade the trails in my neighborhood. Start helping form home, then neighborhood.
I do care about educational charities.
Therefore, I donate to kids’ educations.
I truly believe we can solve all the problems with education and technology.
Is there any connection between money & happiness?
Yes, money will give you happiness.
I also learned that true happiness is your health.
I prefer my health over everything, including my family.
I believe that if I am healthy, I can help others, make more money, and truly enjoy life.
Finding the right balance between chasing money and boosting well-being by spending more time with family/friends is super important.
No one in this world is going to tell you how much money you need.
It’s YOU who is going to decide what your sweet spot is. Reread the tweet I shared about how much money is going to give you happiness.
The bottom line
To accomplish great things, we must not only act but also dream; not only plan but also believe. — Anatole France
In summary, money is never enough.
You can always add another zero.
Find your sweet spot, and remember to enjoy life while chasing money.
Let me recall the money wisdom.
- Money is a handy tool but not the ultimate prize; focus on health and keep learning.
- Compounding is the key to acquiring massive wealth (Dont think compounding means only money; learning will bring more ideas on how to compound)
- Continuous learning is the key to growth.
- Spend less than you earn at least in the first couple of years, or I would say at least the first $1000000+
- Don’t depend on one income source. Keep adding more resources. Don’t worry about hiring people who can actually add more time to your plate by taking over the tasks you are doing repeatedly.
- Give back to society. Donate, start from your neighborhood.
Book recommendation:
The Psychology of Money: Timeless Lessons on Wealth, Greed, and Happiness
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