Secrets of rich people

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I've been reading The Millionaire Next Door. It's dated, but the principles and information still applies to modern times. You can Google the book if you want a synopsis of the main points.

This x1000. Go read the posts about people spending $20 or more a day on lunches and do the opposite. I still shop at thrift stores, use online coupon codes, and go to lower prices grocery stores and eat out maybe 1 time a month. We are wealthy but you would never, ever guess it.

Why on earth would you live this way of you are wealthy? Just to have more money in your bank account when you are alive and money to give your kids when you die? No thanks!

This is the way many, if not most wealthy people live. That's partly how we get to be wealthy. The habits of a lifetime are hard to break regardless of your bank balance.

Yes, but what’s the point of being wealthy if you live that a poor person? Is it enough for you just the psychological security of a big bank account and nothing else to show for it?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:If you have two incomes, pretend you only have one and invest the other. Do this forever, and you'll be rich.

This is what we've done. We weren't handed anything. It's not a secret. We don't appear rich, although we are.

That only works if you could live on one of the two incomes. In a high cost of living area like DC, many people cannot. In fact, I would venture a guess that most people cannot.

If you have two professional incomes, you can live on one of them. If DC is too expensive for you, don't live in DC; it's not a requirement. If you have the kind of job that is only available in DC, then you can live on that income alone.

Teachers and social workers are professionals without professional incomes.

People live in DC for lots of reasons.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I've been reading The Millionaire Next Door. It's dated, but the principles and information still applies to modern times. You can Google the book if you want a synopsis of the main points.

This x1000. Go read the posts about people spending $20 or more a day on lunches and do the opposite. I still shop at thrift stores, use online coupon codes, and go to lower prices grocery stores and eat out maybe 1 time a month. We are wealthy but you would never, ever guess it.

Why on earth would you live this way of you are wealthy? Just to have more money in your bank account when you are alive and money to give your kids when you die? No thanks!

This is the way many, if not most wealthy people live. That's partly how we get to be wealthy. The habits of a lifetime are hard to break regardless of your bank balance.

Yes, but what’s the point of being wealthy if you live that a poor person? Is it enough for you just the psychological security of a big bank account and nothing else to show for it?

NP. Because shit happens--even when you have good insurance--shit happens. I never want to be the person who lived it up in their 40s only to be in a hopeless position in their 60s because they didn't want to "live like a poor person." Live like a SMART person. Live like a prepared person.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I've been reading The Millionaire Next Door. It's dated, but the principles and information still applies to modern times. You can Google the book if you want a synopsis of the main points.

This x1000. Go read the posts about people spending $20 or more a day on lunches and do the opposite. I still shop at thrift stores, use online coupon codes, and go to lower prices grocery stores and eat out maybe 1 time a month. We are wealthy but you would never, ever guess it.

Why on earth would you live this way of you are wealthy? Just to have more money in your bank account when you are alive and money to give your kids when you die? No thanks!

This is the way many, if not most wealthy people live. That's partly how we get to be wealthy. The habits of a lifetime are hard to break regardless of your bank balance.

Yes, but what’s the point of being wealthy if you live that a poor person? Is it enough for you just the psychological security of a big bank account and nothing else to show for it?

NP. Because shit happens--even when you have good insurance--shit happens. I never want to be the person who lived it up in their 40s only to be in a hopeless position in their 60s because they didn't want to "live like a poor person." Live like a SMART person. Live like a prepared person.

Have you ever known someone this has happened to? You don’t have to live like a poor person to have money in your 60s.

[Anonymous]

NP here: yes, I so know someone like this. Lived lavishly and then an ms diagnosis changed everything.

[Anonymous]

Anonymous wrote:NP here: yes, I so know someone like this. Lived lavishly and then an ms diagnosis changed everything.

If I received an MS diagnosis I’d be even more upset I spent my best years living like a poor person!

[Anonymous]

Anonymous wrote:

Anonymous wrote:NP here: yes, I so know someone like this. Lived lavishly and then an ms diagnosis changed everything.

If I received an MS diagnosis I’d be even more upset I spent my best years living like a poor person!

+100. All the while your family is waiting for you to die and bicker over who is going to get that money.

[Anonymous]

The best way to get rich is to start your own business. Otherwise, you're just working for someone else and it's the margin. For example, a non-partner lawyer is billing at $X per hour, then the firm takes their cut. There's an upper limit to how many hours you can bill, so there's the limit on your income.

If you own a business, you can scale it up and make more money, endlessly.

Our HHI is $1mln. We eat out when we want, and drive nice cars and live in a nice house. Nothing is extravagant, but it's nice and high quality. More importantly, I always treat people with respect. Golden rule.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I've been reading The Millionaire Next Door. It's dated, but the principles and information still applies to modern times. You can Google the book if you want a synopsis of the main points.

This x1000. Go read the posts about people spending $20 or more a day on lunches and do the opposite. I still shop at thrift stores, use online coupon codes, and go to lower prices grocery stores and eat out maybe 1 time a month. We are wealthy but you would never, ever guess it.

Why on earth would you live this way of you are wealthy? Just to have more money in your bank account when you are alive and money to give your kids when you die? No thanks!

This is the way many, if not most wealthy people live. That's partly how we get to be wealthy. The habits of a lifetime are hard to break regardless of your bank balance.

Yes, but what’s the point of being wealthy if you live that a poor person? Is it enough for you just the psychological security of a big bank account and nothing else to show for it?

NP. Because shit happens--even when you have good insurance--shit happens. I never want to be the person who lived it up in their 40s only to be in a hopeless position in their 60s because they didn't want to "live like a poor person." Live like a SMART person. Live like a prepared person.

Have you ever known someone this has happened to? You don’t have to live like a poor person to have money in your 60s.

+1 ya, the notion that you need to shop at thrift stores and rarely eat out if you want to have financial security is just plain dumb.

We have a high household income. We don't spend tons - I don't buy luxury handbags or fly first class or anything like that - but we also don't live like we're below the poverty line...

[Anonymous]

Anonymous wrote:The best way to get rich is to start your own business. Otherwise, you're just working for someone else and it's the margin. For example, a non-partner lawyer is billing at $X per hour, then the firm takes their cut. There's an upper limit to how many hours you can bill, so there's the limit on your income.

If you own a business, you can scale it up and make more money, endlessly.

Our HHI is $1mln. We eat out when we want, and drive nice cars and live in a nice house. Nothing is extravagant, but it's nice and high quality. More importantly, I always treat people with respect. Golden rule.

I represent a lot of business owners and learned early on I never ever want to own my own business. Subcontractor claims and disputes, owner refusal to pay, always having hundreds of thousands of dollars tied up in a project that if it goes sidewise your business could go belly up? Nah!

[Anonymous]

Anonymous wrote:

Anonymous wrote:The best way to get rich is to start your own business. Otherwise, you're just working for someone else and it's the margin. For example, a non-partner lawyer is billing at $X per hour, then the firm takes their cut. There's an upper limit to how many hours you can bill, so there's the limit on your income.

If you own a business, you can scale it up and make more money, endlessly.

Our HHI is $1mln. We eat out when we want, and drive nice cars and live in a nice house. Nothing is extravagant, but it's nice and high quality. More importantly, I always treat people with respect. Golden rule.

I represent a lot of business owners and learned early on I never ever want to own my own business. Subcontractor claims and disputes, owner refusal to pay, always having hundreds of thousands of dollars tied up in a project that if it goes sidewise your business could go belly up? Nah!

Sounds like a construction or real estate development business, with an incompetent owner. All those risks can be managed, for example by using third-party escrow on funds, and trusted lenders.

I've been doing my business for 15 years and I certainly learned a lot of painful lessons early on, and we learned to handle them. Now we no longer have those issues.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The best way to get rich is to start your own business. Otherwise, you're just working for someone else and it's the margin. For example, a non-partner lawyer is billing at $X per hour, then the firm takes their cut. There's an upper limit to how many hours you can bill, so there's the limit on your income.

If you own a business, you can scale it up and make more money, endlessly.

Our HHI is $1mln. We eat out when we want, and drive nice cars and live in a nice house. Nothing is extravagant, but it's nice and high quality. More importantly, I always treat people with respect. Golden rule.

I represent a lot of business owners and learned early on I never ever want to own my own business. Subcontractor claims and disputes, owner refusal to pay, always having hundreds of thousands of dollars tied up in a project that if it goes sidewise your business could go belly up? Nah!

Sounds like a construction or real estate development business, with an incompetent owner. All those risks can be managed, for example by using third-party escrow on funds, and trusted lenders.

I've been doing my business for 15 years and I certainly learned a lot of painful lessons early on, and we learned to handle them. Now we no longer have those issues.

Some are large and some are small. However, when dealing with federal projects there are always issues. And I’ve been on both sides of the table as the govt representative and in private practice. It’s not the escrow on funds or trusted lenders that are the problem. That’s easy.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The best way to get rich is to start your own business. Otherwise, you're just working for someone else and it's the margin. For example, a non-partner lawyer is billing at $X per hour, then the firm takes their cut. There's an upper limit to how many hours you can bill, so there's the limit on your income.

If you own a business, you can scale it up and make more money, endlessly.

Our HHI is $1mln. We eat out when we want, and drive nice cars and live in a nice house. Nothing is extravagant, but it's nice and high quality. More importantly, I always treat people with respect. Golden rule.

I represent a lot of business owners and learned early on I never ever want to own my own business. Subcontractor claims and disputes, owner refusal to pay, always having hundreds of thousands of dollars tied up in a project that if it goes sidewise your business could go belly up? Nah!

Sounds like a construction or real estate development business, with an incompetent owner. All those risks can be managed, for example by using third-party escrow on funds, and trusted lenders.

I've been doing my business for 15 years and I certainly learned a lot of painful lessons early on, and we learned to handle them. Now we no longer have those issues.

Some are large and some are small. However, when dealing with federal projects there are always issues. And I’ve been on both sides of the table as the govt representative and in private practice. It’s not the escrow on funds or trusted lenders that are the problem. That’s easy.

That's not my industry but one of my good friends is in that industry and he's a multi-millionaire. I think it's poor management or not keeping your eye on the ball that can lead to the problems you describe.

Heck, if you look at the top lists of richest people, what do they all have in common? Business owners.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I've been reading The Millionaire Next Door. It's dated, but the principles and information still applies to modern times. You can Google the book if you want a synopsis of the main points.

This x1000. Go read the posts about people spending $20 or more a day on lunches and do the opposite. I still shop at thrift stores, use online coupon codes, and go to lower prices grocery stores and eat out maybe 1 time a month. We are wealthy but you would never, ever guess it.

Buying a $20 lunch EVERY work day, assuming you never take vacation, would be $5000/year.

First off, most people are paying half that. Second, $5000/year is not going to make or break you rich. It's the big expenses that effect that, like housing, childcare. Third, its hardly like the lunch you take from home is free, and it takes time -- you might be better off working a few hours longer or picking up more hours at work rather than packing and washing a lunch, as well as the networking opportunities that come from eating lunch with colleagues.

The lunch or coffee is not the line between rich and not rich.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I went to a preppy New England boarding school and the biggest difference I noticed is that people who are rich don't need to prove to anyone they are rich. If anything, they competed over who lived a simpler life. There were no BMWs on campus, though I'm sure at least some parents could afford to buy a new car for their high school kid. People wore a lot of LLBean and JCrew (durable but not flashy). I really liked this laidback approach and it rubbed off on me. I was not ashamed of getting hand-me-down baby clothes--I thought it was practical. I don't want to drive a fancy car, because I feel like it's in poor taste/flaunting one's money. And this approach for the most part does keep you from going overboard. We don't spend our whole pay check, but without that much conscious effort.

Also, my DH is good with finances, which has set us way ahead. Again, it's not something easy to replicate, because I for one can't force myself to care, but I do recognize that it works. He thinks about best ways of handling money, does some research, and acts accordingly. I can spend hours reading child care forums, but financial stuff is boring to me, and would be hard to do on my own.

I think this is really why rich people want their kids to be surrounded by the other rich, so that these good habits stick.

That's probably the local culture and is not representative of all rich or wealthy people, or even a majority thereof. You do what you want and what makes you happy, while at the same time don't ridicule others who choose to behave differently with their money. It just as inane for you to find it in poor taste for others to spend their money as others may shun your thrifty lifestyle. There is no right or wrong answer in this, as it falls down to subjective preference. As long as the spending is within their means, there is no negative lesson to be learned from rich people spending their money in ways that pleases them.

You people are so out of touch. L.L. Bean *is* a luxury brand for most of the US. We ordered from them once every few years to splurge on a good winter coat (mostly b/c it basically came with "insurance" with the lifetime guarantee and we were hard on our clothes)