Do You Want to Get Rich?

Do you want to get rich? Should I even bother to ask this question? Perhaps you may say that the answer is pretty obvious.

Let's explore the reasons why we want to get rich. When we are rich, we could afford to travel to Europe and other interesting places, eat in fancy restaurants, take vacations for as long as we want, and the list goes on. When we are rich, we could afford to help more people because we have more resources to give. And the best part of being rich is that we are FREE! We don’t have to tire ourselves doing that job that is not of interest to us. And we could have more time to do things that really matter to us and to spend time with people that we really love.

For some time, I became addicted to the idea of getting rich so that I could resign from the corporate world and so I could have more time doing the things that really matter to me like writing, playing badminton, bonding with my family and friends, doing outreach activities, etc. And so I frequented bookstores and I read financial books written by well-renowned authors like Robert Kiyosaki, Francisco Colayco, Larry Gamboa, Bo Sanchez, etc. From the tons of books that I read, I was able to unravel the secrets of the rich.

Let me share with you the three most basic principles of getting rich.

1) First, accumulate assets and eliminate liabilities.

This first principle is very simple. But why is it that only about 3% of the population are rich? The reason is that we do not know the difference between an asset and a liability. We are accumulating what we think are assets but which are in fact liabilities.

Let me illustrate my point. Almost everyone has a credit card. With the credit card, we are empowered to buy things that we don't need with the money that we don't have. Young professionals buy the latest gadgets using their credit cards. Some even take out car loans knowing that a car is an asset. Is car really an asset? :)

The next thing they realize is that they have so much debt to pay and they are in such a financial mess. Though they would get tired and sick of their jobs and would have wanted to resign, they can’t do so because they are trapped with their debts. They need to continue working to earn money to pay for their debts.

What is an asset and what is a liability?

According to the best-selling author of Rich Dad Poor Dad, asset is anything that puts money into your pocket while a liability is anything that takes money out of your pocket.

Do yourself a favor. Buy a notebook and start tracking your assets and liabilities. At the end of each month, calculate your assets against your liabilities. Your assets will include your cash on hand, your savings, your investments, etc. Your liabilities may include your loans, credit card debts, or your accounts payable to other individuals. Your assets less your liabilities is your net worth. Is it positive or negative? If it’s negative, then resolve to make your net worth positive by accumulating more assets and reducing your debts.

2) Second, pay yourself first.

Do you save a portion of your income each month? Saving a portion of our income is quite hard considering the rising expenses. When we receive our salary, our savings formula is: INCOME less EXPENSES. We then save whatever is left. However, oftentimes, none is left to save.

The rich uses a different formula.
Expenses = Income – savings. This means that before they even allot a portion of their income to pay for their expenses, they first take aside a portion to save.

Save and invest as early as you can. For all you know, time can be your best friend.

3) Third, mind your own business.

The traditional school taught us about Math, English, Science, etc. but it never taught us about financial management. Filipino parents would always advise their children to study hard so they can get employed in a nice company. But Chinese parents advise otherwise. They tell their children to study hard so that they can eventually put up their own company.

One way of getting rich is to shift from being employees to being business owners. If you can't afford to become a business owner yet, try shifting your mindset from employee mindset to entrepreneur mindset. Entrepreneurs take responsibilities. Entrepreneurs are proactive, not reactive. Instead of complaining that your mind has been stagnated because your work doesn’t offer any more room for growth, read books or take short courses.

We may not realize it but sometimes money dictates how we behave. Instead of spending quality time with our loved ones, we spend long hours at work simply because we need to earn money t pay our bills and to make both ends meet. We work for money.

I'll share with you a different perspective that the rich and successful people practice. Yes, we all need money but we don’t necessarily have to work for money. Instead, we can learn the art of making money work for us. Sounds impossible, right? But this is one thing that can be learned and that could lead you to riches once learned. Invest in your mind. Read good financial books. Learn how the rich did it. Learn from the experts.

Why would you want to work for money when you can make your money work for you? Doesn’t that make more sense?

P.S. I am not yet rich. I am still on my learning curve... As I take this journey of getting rich so I could help more people, I am sharing with you what I have learned and what I am learning. As Zig Ziglar says, "You can have everything in life that you want if you will just help enough other people get what they want."