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10 Reasons Why You’re Not Rich

10 Reasons Why You’re Not Rich

In January 2016, the multi-state Powerball lottery game reached a record high jackpot of $1.5 billion. If you’re reading this article right now, odds are you were not one of the winners. Unfortunately, many people have a lottery mentality, in that they believe the only way they could possibly be rich is to win a large lottery prize.

The fact is that anyone is capable of being rich in this world. According to many self-made millionaires, building wealth and becoming rich is not up to the luck of the draw—it is up to you and your mentality about money. To them, it’s not about why you can’t be rich, but about the reasons why you’re not rich already. Here are some of the reasons the rich say you’re not among them.

1. You think being rich is a privilege reserved for others and not you.

We live in a capitalist society, which means you have just as much of a chance to earn wealth as anyone else—as long as you are willing to put in the effort to create value for others.

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2. You don’t think you’re smart enough.

A lack of a formal education has rarely ever held back successful people. The founders of Microsoft, Facebook, IKEA, ALDI, Luxottica, and Dell Computers were all either college dropouts or never even attended college.

3. You don’t think you’re capable of being rich because you’re not ambitious.

Rich people aren’t any more ambitious or have any more desire to be rich than you do. They just have more faith in themselves to make their dreams come true. In order to become rich on your own, you need to believe in yourself more.

4. You focus on saving money versus earning more of it.

Don’t misunderstand this. Rich people save their money too, but they don’t just put it in the bank in a low interest savings account. They save their money wisely in ways that will earn them more through investments and higher returns.

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5. You think the only way to earn more money is to work more hours.

Sure, if you get paid by the hour, and you put in some overtime, you’ll earn a few more bucks in your next paycheck. That’s obvious. That’s not the way to earn wealth though. Rich people look at ways to find solutions to problems that will earn them income. Doing that isn’t based on how many hours you punch in on the time-clock.

6. You’re afraid to fail.

Many of the wealthiest self-made individuals have failed at something before hitting it big. Don’t be afraid of making mistakes. Just treat those failures as learning steps along the way to success. Failure is a teacher and not an end-all.

7. You’re not hanging out with the right people.

We all love our friends. But, if your friends are poor and have poor mentalities, then hanging out with them isn’t going to help you. Rich people associate with other rich people not because they’re snobs, but because they learn from and lean on each other. If you want to be rich, be around rich people and take notes.

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8. You believe that life is supposed to be a struggle.

People have been taught to be grateful for what they have. That’s true, but it doesn’t mean they should settle for it. Rich people strive for more, and you should too.

9. You believe money is evil.

Money is not evil. Money is necessary to buy the basic things we need to live. To the rich, though, money is more than that. Money is a positive tool that can be used to earn more money, give them the freedom to do what they want, and allow them to live worry-free.

10. You resent the rich.

Many people believe that rich people are crooks, liars, scam artists, spoiled, mean narcissists who should be rounded up. You don’t want to be rich because that means you would be selling out your soul. The fact is that many of them are very generous people who donate much of their money and time to worthwhile charities and causes. They’re also more than willing to help you learn the things they learned along the way.

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For more tips on changing your mentality about money and understanding why you’re not rich, I recommend reading Steve Siebold’s book, How Rich People Think. Steve is a self-made millionaire who interviewed over 1,200 wealthy people and compiled their thoughts and advice in his writings.

Featured photo credit: www.gotcredit.com via flickr.com

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Published on September 17, 2018

How Being Smart With Your Money Leads to Financial Success

How Being Smart With Your Money Leads to Financial Success

Achieving financial success is not something that just happens. Maybe if you win the lottery or something, but for the average person like you or me, it comes from a series of small steps you take over a long period of time.

With each step, you form a new smart money habit. And with each smart money habit, you build towards financial independence.

So what sort of habits can you form to get on that path? Let’s take a look at smart money habits you can start today to get you closer to a financially independent future.

1. Avoid being “penny wise but pound foolish”

It’s tempting to try saving a couple cents here and there when buying small items. However, that’s not where the real money is saved. You’re putting in extra effort for something that doesn’t move the needle.

You get the most bang when you’re able to cut down on your bigger bills. For example, finding a lower interest rate for your mortgage could save you $50+ per month. And cutting your transportation bill by purchasing a cheaper car or taking public transportation can provide large gains as well.

So, look at your recurring expenses such as housing, transportation, and insurance, and see where there’s wiggle room. It’s a much better use of your time than trying to pinch pennies here and there on smaller purchases.

2. When you want something big, wait

Impulsivity can get you in trouble in most aspects of life. Finances are no different.

It’s human nature to see something and want it right then and there. It starts as a kid in the checkout line at the grocery store, and it continues on through adulthood.

We get an idea in our head of something we want, and it’s hard not to go out and get it right then.

A good example is wanting a new car. Perhaps you’ve had your car for several years. It’s crossed the 100k mile mark. Maybe maintenance is due, and you’re annoyed that you need to replace the timing belt or purchase new tires.

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So, you get the itch.

You start digging around online, and you realize you could trade in your current car for something newer and more exciting… all for a few hundred bucks a month. Then you get obsessed.

Here’s where you have to take a step back.

Your newfound obsession is clouding your judgement. Rather than giving into the impulse, wait it out.

Set a timeframe for yourself. Maybe you come back to the decision three months down the road. See if the obsession lasts.

It might, but often, a funny thing happens. Often, you forget about it. And often, you find that the new car wasn’t a need at all.

The impulse faded. And you just saved yourself a ton of money.

3. Live smaller than you can afford

You finally get that big raise. And you want to celebrate – and why not?

You’ve been looking forward to this forever. And after all, it was all due to your hard work.

That’s fine, splurge a little. However, make it a one-time deal and be done.

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Don’t get caught in the trap that just because you’re now making more money, you should spend more.

Too often, people get more money and feel like they that gives them the means to buy a bigger house, a bigger car… you know the drill. Resist.

The fact is that living smaller than what you can afford is one of the fastest ways to build savings.

But if you constantly upgrade as you begin to make more, then you’ll never get ahead. You’ll just build up more debt along the way and have just as little wiggle room as before.

4. Practice smart grocery shopping

Food… it’s one of the biggest portions of any budget. And if you’re not careful, it can be one of the biggest drains on your wallet.

But luckily, there are a few things you can do to ensure that you stay smart with your money when buying groceries.

Create a grocery budget

Set a strict weekly grocery budget. When you know how much you can spend on groceries, you can then plan your weekly menu around it.

Once you know what all you need, you can go shopping and keep a running tally as you shop to ensure you’re on track.

I tend to do this in my head, rounding for each item. However, writing it down as you go would probably work best for most people.

Make a list… and never deviate

Never go to the grocery store without a list. If you go to the store with a ballpark idea in mind, you don’t have a true ide of what you need.

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You’re not well-researched. You don’t know what the sales are. As a result, you’re going to make decisions on the fly.

These impulse decisions will lead to overspending, which will derail your grocery budget.

Eat before going grocery shopping

It’s also important to eat prior to going to the grocery store. Hunger is a powerful force.

If you’re shopping on an empty stomach, everything is going to look good. In particular, you may find a lot of ready-made, processed snacks will look enticing.

After all, you’re hungry now and that food is easily available. So subconsciously, you may lean towards those items.

Unfortunately, not only are those items typically less healthy, but they’re likely more expensive. You pay for convenience.

However, when you eat prior to shopping, then you’ll shop with a clear mind. Your hunger won’t cloud your judgement, influencing you to make poor decisions like a cartoon devil resting on your shoulder whispering in your ear.

This makes it much easier to stick to your grocery plan.

5. Cancel your gym membership

Now that you’re all set on your food, it’s time to get smart about managing your budget in terms of physical fitness. And let’s begin by avoiding the gym. The gym bill, that is.

The average gym membership costs around $60 per month. That’s $720 a year.

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Yet, two out of three gym memberships go unused. That means two-thirds of people who have a gym membership are literally giving away almost a thousand bucks a year. It’s crazy!

I recommend seeking an alternative. One good alternative is to look into fitness streaming services.

Streaming services allow you to stream hundreds of workouts like Insanity and p90x, right in your own home for around $10-20 a month. That’s $40-50 less a month than the average gym membership.

Of course, then there’s the free option. The internet is full of free workouts that you can do on your own with minimal or no equipment.

For example, there’s the Couch to 5K program, that I personally used a decade ago to ease myself from couch potato to running my first 5K race. If I could do it, anyone could.

Then there are free resources like reddit that have limitless information on workouts. The Fitness subreddit has done all the research for you, populating workout tips and detailed workout routines for anyone to use in their wiki.

There are several routines that require no equipment. And you can join in on the subreddit to become part of the community, making it easier for those seeking comraderie and encouragement in their fitness goals. All for free.

It’s baby steps… And baby steps can start now!

I’ve never met anyone that can’t stand to be a bit smarter with their money. And on the flip side, anyone can get smarter with their money. But remember, it doesn’t happen all at once.

Begin by fighting your impulses. Prepare for the week and be smart at the store. And cut monthly expenses like gym memberships that are overpriced and you probably aren’t getting your money’s worth out of anyway.

The devil is in the details. And the details can change your lifestyle and prep you for a financially independent future.

Featured photo credit: Unsplash via unsplash.com

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