Have you ever wondering how much better your life would be if you were rich. You could buy whatever car you wanted, live anywhere in the world and eat at any restaurant no matter the cost. What if I told you that by understanding one simple but effective principle you could start living this rich lifestyle much sooner than you ever imagined? In this article, I will share with you the one mentality that all rich people have that middle class people don’t that once mastered will take your finances to the next level.
To begin to explain this mindset, I want you to think back to the last time you saw someone driving a really fancy car. Other than thinking to yourself how aesthetically pleasing the car was you probably thought to yourself that the driver must be rich. You may even wonder what he or she did for work that allowed them to afford such a nice vehicle.
Now, think about a time when you saw someone driving a car that was much older than most cars you see on the road. When you saw this car you probably thought to yourself, wow that person must be going through some tough financial times. In both circumstances, we make judgments about people based on the car they drive as if this is the only indicator that wealth is measured by.
I’m sure you’ve known a person or two who drives around in a luxury brand vehicle yet is always complaining about how little money they have. While from the outside it would appear that they are financially stable, reality paints a different picture. Now ask yourself, if this car expense was burdening them so much then why do they continue to own or lease the car?
While I wish I could tell you that the problem lies in the fact that people enjoy to own fancy vehicles, the problem goes much deeper. For millions of people, often those in the middle and lower economic classes, they feel a strong need to look richer than they really are. This urge to look rich is seeded in the need to feel important and one way the middle and lower classes do this is by buying houses bigger than they need, wearing expensive clothes and eating at fancy restaurants just to name a few. In fact, as of 2017, 39 million Americans cannot afford to live in the home they are in. For the majority of these individuals, the constant spending of money to fit in means trading a short-term high for ever-increasing debt.
On the opposite end of the spectrum are the rich. Many of the most affluent people I know are also the most money conscious. While they can afford to drive the newest models of the fanciest brands, the majority of them choose to live a modest life. So if they can afford all of life’s luxuries, why don’t they spend like the middle class? There are two answers to this question and the first is that they don’t have the urge to look rich because in fact they are rich. You don’t see people like Bill Gates or Warren Buffett dressing in expensive clothes or driving around in luxurious cars. They have no need to show off their wealth and through their business successes have nothing left to prove.
The second reason the rich don’t spend money in order to feel important is because they live life based on the following quote: “Rich people have small TVs and big libraries, and poor people have small libraries and big TVs.” The rich become rich because focus on acquiring knowledge that can make them more money rather than spending it on frivolous items that will provide them with no lasting benefit. This difference in focus is just one of the ways the rich differentiate themselves from the other 99% of the world.
Now, you may be thinking to yourself, okay so if I spend less I will soon become rich?, that seems way too simple to be true and yes, it’s the simplest concept in the world but also the hardest to live by. You see, the biggest personal finance problem most people have is not who is president or how good the economy is doing. The biggest problem is people need to spend in order to fit in. In America, most people get their paycheck from a wage job and spend every last dollar just to maintain a false image of being rich which as you now know is the fastest way to becoming broke.
To truly start to become rich you have to stop thinking like a poor person. Becoming rich is more about having the right mindset than having amazing technical skills or an above average IQ. Cultivate your sense of value from within rather then spending every last penny you make on a car you can’t afford just so you can look cool when you drive down the street. So the next time you see your friend getting the newest phone or your neighbour driving the latest model of a car you love, think of it as a test. Every time you fight the urge to buy the hot new thing, you are passing another test and after passing enough tests and saving enough money you will soon see your net worth rise to unprecedented levels and in no time you will be living life like the 1%.
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