Developing a Wealthy Mindset: 26 Wealth Secrets

April 4, 2020


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Disclaimer This ebook has been written for information purposes only. Every effort has been made to make this ebook as complete and accurate as possible. However, there may be mistakes in typography or content. Also, this ebook provides information only up to the publishing date. Therefore, this ebook should be used as a guide – not as the ultimate source. The purpose of this ebook is to educate. The author and the publisher does not warrant that the information contained in this ebook is fully complete and shall not be responsible for any errors or omissions. The author and publisher shall have neither liability nor responsibility to any person or entity with respect to any loss or damage caused or alleged to be caused directly or indirectly by this e-book.

Creating a Wealth Foundation

The rich have a different approach to life. They plan, risk and manage their money in a different manner. They also have a positive attitude towards life and opportunities. The first and most important step to true financial freedom is creating this mindset for yourself. This also involves a no-holds barred, honest look at your life and assets.

  1. Redefine what wealth means for you. Being “rich” simply is a term for many people. Technically, wealth or being wealthy is defined as having an abundance of resources or possessions. The high life does not equal wealth. Having a gigantic mortgage for a beautiful home or a huge car payment does not equal wealth.  Are status symbols your end goal?     Does wealth for you mean that ability not to worry about bills or how much is left in your checking account at the end of the month? Does it mean providing comfortably for your family or being free from financial worry? Does it mean the ability to afford luxury designer goods or getting a membership to the local country club? Being rich or being wealthy can also mean you enjoy a comfortable retirement. Does wealth mean something totally different to you? Your definition of wealth goes a long way towards setting your goals.
  2. Know how much you are worth. Take stock of all your assets and income and subtract your debt. Many people go through life financially blind, not knowing how much they are worth or how much they owe and often end up blindsided by money.
  3. Find alternative ways to generate income if you are unhappy about your current level of earnings or the amount of the salary you currently have. This can mean looking for other employment with better pay or benefits or finding ways to boost your income little by little. This can mean starting a cottage industry business, learning to invest, buying and selling online or any number of means to add to your nest egg.
  4. Create forms of passive income, the type of income that you receive with little to no effort. Examples of this include: rent from the property you own, licensing patents or dividends and returns from investments. The truly wealthy prefer passive income anytime. It frees up time for you to do what you want, even while you earn.
  5. Learn to hold off gratification. Wealthy people know how to delay gratification and sacrifice the now for later. This often comes with a positive attitude towards work and wealth, such as: “If I invest now, I will make 10% more later.” The wealthy do not think of now, they think of the future. The present is merely an opportunity.
  6. Change your mentality about spending. Do you really have to have that (place object here) now? The truly rich hold off gratification, knowing that what is trendy, popular or a must have today may not last until tomorrow.
  7. Never be frightened of failure.
  8.  Create a sense of urgency in your life. Do not wait for things to happen to you. You may think that you are playing safe by waiting around or looking for the next big deal. This is the financial equivalent sitting around. Take risks, invest, start the business now. Seize opportunities the moment they happen. The first to get there often wins,      leaving the losers in the dust.
  9.  Write down your expenses. Do not lie to yourself. There is nothing  like seeing it in black and white (or red). Keep track of your expenses on a spreadsheet or if you prefer, in a notebook. It gives you a concrete idea of where you are spending too much and where you are spending too little.
  10. Understand how interest affects your debt. The wealthy understand how interest works for investments, for loans and how it compounds over time. Those who are not wealthy do not.
  11. PAY DEBT OFF ASAP. Pay more than the minimum on loans. Satisfy the interest and part of the principal—the debt amount will lessen over time and the bonus is you pay it off faster. The more you pay now, the less you pay later.
  12. Create an emergency fund or funds. These accounts should contain the equivalent of 3 to 6 months  salary using low risk accounts (savings, certificates of deposits or insured money market accounts) as a safety net not just for your finances but for unexpected events in your life. This prevents you from dipping into your earnings or cashing in other income resources when unexpected and unwanted events happen, such as sudden illness.
  13. Never accept a deal at face value. Negotiate until you feel the terms are in your favor.

Investing and Managing Your Wealth: Becoming Truly Wealthy

Once you have established a firm financial foundation or put aside a little money, it is time to learn to invest. Many first time investors fall into the trap of waiting, and waiting until they “have enough.” The first thing you have to do is nix that notion, right now. You will find out by reading the tips that even measly amounts can add up to great amounts over time. Others balk at investing because they think “I do not know enough to be a player.” That is right. You do not. The truly wealthy understand how money works and never start sentences with the words “I do not    know.” If you do not understand investing and how it works, it is time to start to do the legwork.

Investing 101: the primary focus of investing is making your money work for you instead of working for your money. Many wealthy people have perfected the art of creating their wealth instead of giving a service. Building wealth also means creating wealth that is sustainable and continues to generate even in the event that you are unable to work.

  1. Learn the difference between having a high income and being truly wealthy. High incomes do not necessarily mean that you are rich, especially if this income comes from only one source.
  2. Even small amounts matter. Many people say they will invest only when they have x amount, but even a small investment of $1000 can give you great returns in the future. By thinking of returns instead of instant cash or how much you have on hand, you create your wealth through possibilities.
  3. Invest your money as early as you can. The true friend of money is always time and the passage of it. The longer money sits and the more interest it collects, the higher the chances that you will reap thousands of dollars in returns.
  4. Buy stock, not product. If you love the product, chances are others will too. So why waste time buying the product when you can make money off the stock. This creates a) passive income and b) a higher chance of return on investments.
  5. Think long term. The truly wealthy do not count on single projects that net huge paychecks, but invest in opportunities that create returns and dividends that last for years. Long term also means the ability of securities to mature. Thinking long term means having the ability to see the future in a sense—and finding projects that affect and create these futures.
  6. Do not wait for business opportunities, create them. Entrepreneurs look at an empty lot and see possibility and a method for them to get rich. Those with a poor mindset simply see an empty lot. The rich look at garbage and see a garbage hauling business, a rust-cleaning service, a recycling center. Those with a poor mindset see only the discarded tires, the dirt and the weeds.
  7. Do not join the bandwagon: just because everyone is putting their money in it, does not mean you should. Get rich quick schemes are simply schemes.
  8. The truly wealthy know how to make taxes work for them. Never be afraid to learn and ask. Instead of having someone do it for you, learn how to do it yourself.

Making Your Money

The wealth mindset is one that works for itself, cashing in on your own ideas and labor. The poor mindset works for others, laboring for a minimum cut of the profit.

  1.  Find a need for something you love and fill it. Filling a  need or creating a need is an excellent starting point for a business. Curves Gym combined the owner’s need for fitness and hatred of being ogled while at the gym. She provided a women’s only gym without mirrors, filling a need many women did not even know existed.
  2. Your business is defined by its employees—especially if you decide to go into any type of service industry. Hire for attitude, train for skill.

Protecting Your Money

Once you have money, you will take time to protect it by avoiding future catastrophes. Be cautious and always assume the worst. Do not go through life thinking that other people will not take advantage of you or that your money is not important to them. A careless mistake can cost you a fortune. A careless demeanor opens you up to attack. And you will never know where it is going to come from.

  1. Millionaires and the truly wealthy never put assets in their name and guard their personal assets zealously. They use corporations and protect themselves with liability insurance. Corporate entities are used to operate businesses, partnerships are made with the idea that if all goes to hell, it is time to get out. Use trusts, family partnerships and protect your personal assets and wealth.
  2. Create a clear-cut and legal will, even if you are young. Make sure you know where your money is going. Many people put off the idea of the will simply because it makes them face their own mortality which is always wrong. For businesses, the equivalent of a will is known as succession planning. Many successful businesses have failed because an epic predecessor was not able to carefully plan who would succeed him in the event of his death.
  3. Never put all your money into one humongous deal. Diversity is the key to true wealth. Keep in mind that those eggs in one basket are more liable to break if the basket is too heavy.
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