Step One: Decide to Be Rich The only difference between the rich, poor
and middle class,is the kind of lifestyle they want and the words they
use. Poor people often say "I just want enough money to pay the rent."
"I need a few thousands to get to the next pay day". People who used
words such as these, often focused only on financial survival.
The middle class used different words because they have different
ideas about how to use their money: "Our home is our most important
asset and our largest single investment." "We're setting a few
thousands aside every month, so we can afford the down payment on our
dream home." "We're saving money for our children's college education
and our retirement." The middle class focused on comfort. That is why
so many of them say, "I don't want to be rich. I just want to be
comfortable."
The rich are rich because they are not focused on day-to-day short-
term survival, or the expense column as the poor are. Nor are the rich
focused on comfort and the acquisition of liabilities using credit, as
the middle class is. The rich are rich because they focus on wealth
building assets.
Think on what stocks/real estate are you adding in the wealth building
column.
Step Two: Decide What Kind of Money Problems You Want.There are only
two kinds of money problems: not enough money or too much money.
Unfortunately, the kind of money problem most people know is not
enough money."Most people know how to work for money, but they do not
know how to have people and money work for the
Think for a moment the shares/real estate which are working for you.
After choosing between being rich, poor or middle class, and then
choosing between too much money or too little money, it's time to
write your plan.
Think on what strategies do you adopt for investing in shares/real
estate.Have you been blindly buying or sticking to a disciplined
approach.
Step Four: Decide on Where You Want to do Your Banking. You can tell
the difference between the rich, poor and middle class simply by where
they go to get their money or do their banking. A poor man's bank is a
pawn shop.The middle class use banks, savings and loans, or credit
unions for their lines of credit. A popular form of credit for this
group is the credit card, which is easy to obtain.
The rich also use banks. They use the services of investment bankers,
private capital from wealthy individuals and money from investment
institutions.
Step Five: Choose Your Friends and Partners Wisely. One of the reasons
the rich get richer is because they spend time with other rich people.
Think for a moment the people around you.Are they successful investors
whom you know.Do you just know only your broker or people who are
broke.If so you really need to expand your circle.
It takes time to build a business as well as an investment portfolio.
Wealth is built by starting your own business. This can start part-
time beginning with a hobby or a new investment opportunity.
Be patient and focus on the risks as well.Patience is one of the most
difficult skills to learn as an investor and trader. The best
investors and traders understand the importance of patience. As one of
Warren Buffett's rules of investing states:
"The Stock Market is designed to transfer money from the Active to the
Patient." The best returns come from those who wait for the best
opportunity to show it self before making a commitment. Those that
chase the current hot stock are destined to loose more than they gain.
Remain active in your analysis looking for quality companies at
discounted prices, but be patient waiting for them to reach their
discounted price before buying.
Think for a moment how you decide on your investments.Do you just
research or go for the hot tips.
Step Seven: Start Small, Dream Big. Many people start small and stay
small, simply because they have small dreams. Big dreams are important
because they possess ingredients vital for success: hope, desire,
passion, energy, vitality, faith, drive, inspiration and creativity.
These ingredients make life worth living.
Begin today and dare to dream big. Dream of all the wonderful things
this world and life have to offer. Write your plan on how you can have
all your dreams come true and look at the plan every day.
Step Eight: Before You Expand You Must Contract. Instead of trying to
be everywhere and do everything, FOCUS. Began by staying focused on
your plan. Make the commitment and do it. Regardless of what you did
yesterday, if you want to do better financially tomorrow, you may need
to forgive your past, tighten up your activities today, so you can
have a bright and prosperous tomorrow. To expand, you must first
contract.
Step Nine: Get Bigger Faster. Started with a small plan and stayed
small. The people who dream small,think small,and work small,work the
hardest and are paid the least. Vowed to focus, acquire education,
gain experience, start small and get big as quickly as possible.
Remind yourself of these words: "The bigger the asset you build, the
less you work and the more money you make".
Step Ten: The More You Share, The Richer You Become. To acquire great
wealth quickly, you must be a person who shares and is generous. If
you are greedy, stingy or tight, it will take you longer to attain
great wealth.To be generous and share,is the foundation of the rich in
building wealth. If you do this, you will become far richer than those
who work only for themselves. If you choose to be wealthy, follow the
plan and do not let anything or anyone steal your dream .
If you're seeking to build wealth and have financial prosperity, we
hope this CI group will lead you to the right information or resources
you need.Keep an open mind and you will find what you're looking for.
"Seek and Ye shall Find, Knock and the Door shall be Open, Ask and Ye
shall Receive".
Can't save? Blame your brain
Slow and steady wins the race, but a bird in the hand is worth two
in the bush. Those dueling proverbs sum up the investing mind.
When you imagine choosing between making a quick buck or growing rich
later, you know the right answer: Be patient and hold out for the
bigger gain. But as soon as you face a real rather than an imaginary
choice, the fast money seems irresistible.
New discoveries in neuroscience labs are helping to explain why it's
so hard to resist the allure of instant gratification. It turns out
that your brain is much more aroused by Rs 1 lac today than by Rs 1
lac tomorrow. And Rs 1 lac six months from now barely registers.
Only the promise of a much bigger reward later can fire up your brain
the way an immediate score does. No wonder it's hard to save instead
of spend and, when you do save, to think long term; the average
holding period for a stock, among individual and professional
investors alike, is just over 11 months.
And the temptation to buy dotcom stocks in 1999, small caps in 2005,
real estate in 2006, Reliance Pack in 2007 — what's hot when it's hot
— is overpowering for many people, no matter how often they've been
burned before.
A sip now or a slurp later?
Recent experiments conducted independently by three teams of
researchers at leading universities have focused on the battle in the
brain between now and later.
Tracking people's choices and their brain activity, one group tested
whether college kids would rather have a sip of fruit juice soon or a
slurp later. They also tracked how folks decided between Amazon.com
gift certificates redeemable the same day for a small amount and those
redeemable up to four weeks later for a larger amount.
A second team offered people the choice between $20 immediately and an
array of alternatives ranging from $20.25 six hours later to $110 six
months later. And a third group measured how individuals responded to
the choice between various dollar amounts today and an extra 5 percent
to 30 percent up to six months later.
"When our emotions are charged, we have a hard time waiting for a
reward," says Carnegie Mellon University's George Loewenstein, one of
the first study's authors. Even the chance of getting a slightly
bigger reward tomorrow doesn't have the same stimulating effect on
your brain as a gain today does.
It's all downhill from there. A gain the day after tomorrow carries
even less of an emotional kick, and so on. In fact, to the typical
person, $20 now is better than $23 three weeks from now, $40 three
months from now or $47 six months from now, according to the second
study, led by a pair of New York University researchers.
In short, for your brain to be willing to wait a mere three weeks for
a higher payout, that $20 would have to grow at an annualized rate of
roughly 4,800 percent.
Rational? Hardly. But evolutionwise, the response makes sense. In our
hunter-gatherer days we often faced scarcity. And when we're really
hungry, a future feast has to be huge to justify choosing it over
eating now.
So are we moderns doomed to save and invest like cavemen? Not
necessarily. Knowing that you operate in what NYU's Paul Glimcher
calls "as soon as possible" mode is the first step to making better
financial decisions. Willpower and good intentions, though, aren't
enough. You need help. Here's what to do:
Lock in for later. Saving now is harder than planning to save later.
So commit yourself to doing the right thing a year from today. Want to
raise your monthly investment contribution? Use calendar software to
mark the distant date when you'll take action — and send an e-mail to
a small group of friends now and on that day reminding them that you
have committed.
Don't take your lumps. When you change jobs, it's tempting to take the
money in your PF as a lump sum instead of rolling it into a new plan
or an Investment, especially if you're decades from retirement. So
whenever you're starting a job hunt, pledge in writing to a friend
that you will roll over the retirement account.
Likewise, if you are older and are fortunate enough to have built up a
sizable pension benefit, pledge that instead of taking a lump sum when
you're eligible, you will string your pension out over many years as
an annuity. Have that commitment witnessed by friends or family
members who are younger than you are so they will likely be around
when you put away the work shoes.
Similarly, when you're investing your savings, you need to resist the
temptation to simply go for whatever looks as if it will provide a
quick return. Take these steps:
Answer two big questions. Why — other than a rising stock price —
should I invest in this business? Do I have any reason to think that I
know more about this company than whoever sells me the stock?
Sleep on it. If putting money into a hot mutual fund is really a good
idea, it'll still be one tomorrow. Waiting until the next morning
won't cost you much profit, but letting your brain's anticipation
circuitry cool down overnight could save you from an ill-timed bet.
And you'll be richer for your patience.
An article by ~ By Jason Zweig (Money Magazine)
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