Tuesday, September 28, 2010

Think Like a Rich Person

By Dennis McCafferty on 2010-09-22
Books about getting rich often seem to work better for authors than readers, so any tome on the subject should be approached with considerable caution. But a new book, How Rich People Think (London House/Available now), provides a fresh perspective on this well-worn topic. Author Steve Siebold isn't pretending to unearth the secrets of the next big investment boom, or hawking some new Ponzi scheme. How Rich People Think is more about understanding the philosophical grounding and practical mindsets of the wealthy, in order to get a sense of how their intellectual and emotional DNA is programmed for financial success. Unlike other classes of society, Siebold writes, rich people aren't afraid of money or ashamed of it. They don't believe that luck plays much of any role in success, and they don't expect to be rescued by a guardian angel if they get into a tough spot. Siebold is a consultant for Fortune 500 companies such as Johnson & Johnson, Procter & Gamble and Toyota. Here are his nine realities of achieving wealth:

1. Middle class people wait for their ship to come in; rich people buildtheir own ship.Fortune smiles upon those who create their own opportunities. Adapt an action mentality, not a lottery one.
2. Success comes from working for fulfillment, not survival.Those who excel do so because they love work, as opposed to just earning apaycheck. Donald Trump and other players have a passion for the deal.
3. Money isn't about education. It's about knowledge.Target training and advanced degrees for the end result of maximizing yourvalue in the market.
4. Hard work doesn't equate to money. Leverage does.Tap your greatest strengths and pinpoint how to make them more salable.
5. Referrals create millionaires.Use success with one relationship to create 10 others just like it.Encourage a referral system to deliver opportunity upon opportunity.
6. Money is a tool that must constantly be re-used. Money is infinite. Accomplishing a financial milestone should immediately befollowed by a re-investment plan to make more.
7. Logic, not emotion, guides wise investment decisions.Use panic-inspired market sell-offs to invest in companies and industrysegments that likely are down only for the moment.
8. Rich people are better at keeping their money than the working class.They study and seek advice on protecting earnings from taxes. They know, forexample, that a Roth IRA beats out a traditional one in the long run.
9. Appreciate the value of invisible wealth.Cars, clothes and status objects do not define wealth or success. Assets,strength of portfolio do.

The ultimate anti-rich thinker was George Bailey in It's a Wonderful Life, who wanted to be wealthy but set himself up to be poor.1. He let others dictate his path instead of taking control of his destiny.2. He had great vision, but never used it to make his own fortune.3. He wanted to build skyscrapers, but ended up plugging holes in financialdikes.


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