How To Be Rich

If you want to be rich, you need to act like rich people. (If you want to be poor, act like poor people.)

Poor people spend everything that they earn. Some even spend more than they earn, going into debt with credit cards or loans. Living paycheck to paycheck is not fun (ask anyone who has done it).

Rich people spend less than what they earn. Sarah Damon reports that, “80 percent of America’s millionaires are first-generation rich, and they got that way by living below their means and saving the difference.” She then goes on to say, “To live below their means, the majority of millionaires (62.4 percent) track their spending. They know how much their family spends each year on groceries, dining out, gifts, clothing, child care, charity, financial advice, bills, tuition and vacations.

Fortunately for you, you can find a FREE Spending Plan on this blog for your use. Part of that spending plan is a section for savings. Some saving will be for short term use like vacations, furniture, or real estate taxes. Some savings will be for long term like appliance replacement, children’s college, or retirement.

But don’t exclude a special savings accounts for those unexpected expenses. My family use to call it a Rainy Day fund. Mary Hunt calls it a Contingency Fund. Suze Orman calles it Save Yourself Account. Many others call it an Emergency Fund. But whatever you call it, you need to do it.

What is preventing you from starting today?