Money is not something that is earned, it is something that is learned
What I’m about to tell you about money will probably go against everything that you were taught growing up. The things you were made to value and consider to be a part of having a good life might actually be what is stopping you from achieving your goals and getting rich.
What I have listed below are the top 10 things that will keep you from getting rich. Some of these things you might be quite attached to, and that’s fine; but if you really want to be rich, you might want to reevaluate where they sit on your list of priorities.
Children are hands down the biggest liability that you will ever have. They cost a fortune to raise, they give nothing back and will distract you from getting ahead in life. Just ask your parents! If they are honest they will tell you just how much you and your siblings cost them over the years and stopped them from living out their childhood fantasies. They wont admit it, but they have definitely wondered on occasion what their lives could have been like if they’d never had children, but usually that wont stop them from pestering you to procreate! They went through that hell so you should too right? Give them some grandchildren they can spoil and then leave you to clean up the mess.
If you are a man and you want to be rich. Don’t have children before 30. Heck, don’t have them before 40. Get your finances sorted, get some assets and some riches. Learn about the world, travel a bit. Build a business, and then when you are swimming in it and well and truly ready to settle down, go find yourself a hot young wife and go for gold. Have children when your income is already so high they will just be a blip in the ocean. Have them when you are young and broke, and you will be swimming in debt for decades to come.
The same applies to pets, they are cute and you love them but they cost a fortune. They also make it harder to travel and be versatile in your career.
If you are buying expensive flashy cars to impress women, but you can barely afford to put petrol in your car, then you are an idiot.
Cars depreciate in value faster than just about any other tangible asset. Unless you are an Uber driver, or you need it for running a business, you wont get any tax breaks and it will be sapping your income for years to come.
From an economic standpoint you are actually better off buying a motorbike if you want something to impress girls with. You can get very cool looking bikes for less than half the price of a new car. They consume far less fuel, registration is usually less depending on where you live, or better yet, catch public transport and pay for a car service when you need one. You will still have more money in your pocket at the end of the week.
A flashy car is a luxury that you simply don’t need. Save the money and put it towards something that will generate income for you instead. For the price of a car in my city, you can actually buy a car park and rent it out. You will still have the asset plus you will be increasing your income. Buy things that will make you money, flashy cars will not make you money.
Who doesn’t love partying? Sex, drugs and rock ‘n roll right?
Smoking, drinking and drug taking can temporarily enhance your experiences but they also carry a huge financial toll and excess consumption will ruin your mental and physical health.
You can only afford to party if all the other aspects of your life are going well. If you are broke, depressed and lonely then partying is the last thing that you should be doing. Yet those who party the most are more often than not of that category.
Live a lot, but party a little. At least until your finances are so well sorted that you can easily afford the decadence and still continue to grow your wealth and prosperity.
4. Your Job
This is pretty obvious, but it amazes me how many people stick at a job they hate, on a crappy wage because the prospect of getting a new job seems too hard.
There is a book called Rich Dad Poor Dad that you should definitely read at some point. In it the author Robert Kiyosaki says, “You should work to learn, not to earn”. If you are working at a dead end job just to pay the bills then you are doing life wrong. Your job is the best opportunity for you to learn and get paid for it. Even if it means taking a lower wage temporarily, you will be better off working somewhere that will give you the skills to make lots of money later than to stay at a job where you are learning nothing and going nowhere.
5. Bad Accounting
Unless you are a certified accountant or have extensive financial training, hire an accountant to do your taxes and a financial adviser to tell you how to best invest your money.
If you love paying money to the government, then by all means keep doing your own taxes and do a solid for Uncle Sam. However if like me, you want to pay less taxes and keep more money for yourself, hire a professional to help you manage your finances, you will save a lot of money in the long run.
6. Bad Diet
If you were told that you could only have the one car for the rest of your life, you would probably take good care of it, wouldn’t you?
A body is no different. You only get one, and if you don’t take good care of it, it will end up costing you a fortune and in the long run you will pay the ultimate price.
Treat your body as your most valuable asset. Eat healthy, exercise go to the doctor for a checkup, even if you don’t feel sick. Good health will reward you time and time again.
For your house, you should be buying something cheap, that you can pay off within a few years, so then when you move on, you will have an investment property.
In most countries around the world you don’t get any tax breaks on the house you live in, but you will get them on the houses that you rent out as investment properties. While you are starting out, try to keep the mortgage on the house you live in as low as possible. Better yet, consider renting out some rooms if you have a big house, but be aware this can be pretty stressful if you don’t like your tenants and you need to see them everyday. So before you do that you might want to consider renovating so you can have your own separate living area.
8. Credit Card Debt
There are some people who can manage credit card debt really well, and end up being able to enjoy the incentive awards that come from using them.
But MOST people, think they can manage it well so they sign up and suddenly discover that they can’t. Credit Card companies make a lot of money, and if everyone was good at managing them they would go broke overnight. Unless you know you have a stable income and plenty of disposable income to cover your purchases, stay away from credit cards.
Furthermore, if you do have a lot of credit card debt in addition to a mortgage, consider recycling your debt. Recycling debt is when you use your mortgage which has a lower interest rate to pay off your other loans which have higher interest rates. For instance, credit card and car loans generally have higher interest rates so you are paying the bank a lot of money. By recycling your debt into your mortgage, you end up paying a lot less interest overall and you can manage your debt in one place.
9. Student Loans
Student Loans are usually the best loans to have in terms of interest rates. Some countries like Australia don’t charge any interest at all, so as far as debt goes, it’s not the worse.
That being said, student loans are still debt and if you are going to start your adult life with a huge volume of debt, then you should make sure that it’s worth it.
So many young people these days go to College because its what they think they should do, or they want to experience the “College Lifestyle”. Or they think they need to go to College in order to get rich. I will tell you now, people don’t learn to get rich in College. In fact many of your favorite billionaires such as Steve Jobs, Mark Zuckerberg and Bill Gates were all College dropouts.
If you want to learn how to make copious amounts of money, don’t learn from Professors who have spent decades studying money. Learn from people who have actually gone and made themselves a lot of money. You wont find many of them anywhere near a College campus.
When you meet that special girl that you want to settle down with, add up your own finances and add up hers, then divide that number by half, minus an additional 5-10% for solicitors fees and that’s what you will likely end up with. If kids are involved, halve that amount again.
Do not get married unless you are absolutely sure beyond any doubt that you can trust that person and want to spend the rest of your life with them. Or if you do need to get married, try to marry a girl with the same or more wealth than you. Don’t just marry the pretty girl who likes nice things and has never had to work for anything. This person will become your business partner. Would you ever go into business with someone because you thought they looked nice, or you liked the way they smell?
The honeymoon period doesn’t last forever. At the end of it, you are left with a person who’s natural instinct is to take care of themselves (and their children) first. Don’t buy the cow when you can get the milk for free. Take your time shop around, make a good decision that you wont later regret. The male biological clock lasts a long time; there is no rush to settle down.