There’s a significant difference between how the wealthy think and go about making an income versus how people that aren’t wealthy think and utilise their time.
The most significant difference between the rich and the poor is that less wealthy people have a tendency to spend money in order to derive immediate pleasure or comfort whereas the wealthy have a tendency to invest their money in order to derive long-term benefit; and that’s the thing, money is a resource that you can either invest or you can spend… how you utilise the resource of money will determine the quality of your financial life.
If you’re wanting to generate wealth then the first thing you need to do is shift your thinking and the way you feel about financial abundance. The second thing you need to do is find a strategy that creates wealth.
In this vein, there’s a very helpful book called “Rich Dad Poor Dad” where Robert Kiyosaki presents the four different ways in which people make an income and puts them into the following categories:
- Small Business Owner (or self employed)
- Big Business Owner
Unfortunately, being an employee is the most common yet most ineffective way to go about creating wealth, because as an employee you are trading your most vital and finite resource (time) for money… and there’s an intrinsic limit to how many units of time you can trade in a set period, which means your income is inherently limited.
SMALL BUSINESS OWNER
The term small business owner, in this context, mostly relates to people that ‘own their job’ such as people who are self employed as a personal trainer or massage therapist, for instance, where people are still trading units of time for money but have more control over how much they charge and what hours they operate.
Small business owners remain subject to the inherent limitation of trading time for money, meaning there are only so many hours in a week, and also, there’s a ceiling to what people will pay for your unit of time.
BIG BUSINESS OWNER
The big business owner has leverage; meaning they leverage the efforts of others, or even systems, in order to generate income passively. That said, you don’t need to be Richard Branson to have a big business; it could be as simple as running a fleet of ice cream van or employing a few window cleaners.
The key principle being that you leverage your time by managing a team of other people that are doing the work for you; and leverage in this sense, is extremely important to generating great wealth as the wealthy build systems.
The investor has true leverage; as rather than work for money in the conventional sense of swapping time for money they have it so that their money works for them, by providing a return on investment in the form of interest, dividends or royalties.
Now that we have a grasp of the four ways of making money, let’s look at three general principles to help you adopt the mindset of the wealthy:
- GET STARTED TODAY
A lot of people are “waiting” for the perfect circumstances to start investing or building a business; yet the perfect circumstances are never going to land on your lap, you have to take action in the imperfection of the current moment.
If that means making pay stubs online, then so be it, the trick is to get started and there’s no better time than today to get started. It’s vitally important to have goals, and whilst you are encouraged to dream big, it’s also important to ensure you have smaller monthly goals that keep on on track.
- ENVISION A PROSPEROUS FUTURE
Many highly successful people talk about the importance of thinking positive and employ the power of positive visualisation, similar to how athletes spend hours visualising themselves winning a race, wealthy people see themselves as successful.
- DREAM BIG
Those with the wealthy mindset understand the importance of having big dreams as it is no harder to achieve a big dream than it is a little dream; it just requires a little more self-belief and action to be taken… that’s the only difference.