Topic: Things to avoid when you earn a lot or become rich - page 9. (Read 2171 times)

Yes, it would be good if we had sufficient income in this case, it would be better if we didn't look too flashy when we socialize in society and look as simple as possible. Use your finances as wisely as possible, what you have obtained so far has been full of struggle for a long time. Take advantage of what you have achieved so far and continue to get other sources of income.

I remember an ideology which says that if you move to level three (pertaining to net worth) don't be in a rush to upgrade your lifestyle as well on the same level. For me it simply means to create a margin with how much you have and how much you would spend because if it would be equal, then nothing will change. Personally, whenever I am planning to buy new things like a new phone, I do check if I could buy it 10x first before actually making a purchase, which works for me and allows me to not be on a financial burden for the next days or months. Becoming rich indeed is a wonderful thing to happen in everyone's life and for sure it would be tempting to buy anything you would want to however if things won't be consistent you have to consider managing your cashflow still.

It cannot be denied that there are many young people who can succeed early and become rich but that does not mean they can give advice to others to get rich because as I also said. Each person has a different life situation, different life challenges and more importantly, our starting line is different. Therefore, truly experienced and mature people will not arbitrarily give advice to anyone, or try to brag about their success.

For me, giving financial and investment advice to others is a huge risk, let alone getting rich or teaching someone how to spend money. If someone can get rich with their own hands, with their own efforts, then they are not stupid enough to not know how to manage their finances and need someone else to teach them.

Your labor is a finite resource.  There are only so many hours in a day and so many days in a lifetime.  Your ability to exchange your labor for money is not scalable or infinite.

Your money, when invested, can work 24/7/365 making you even more money and it is infinitely scalable.

Most of us who started with nothing have no choice but to work for our initial money to invest (capitol).  The late Charlie Munger summed it up best:

"The first $100,000 is a bitch, but you gotta do it. I don’t care what you have to do – if it means walking everywhere and not eating anything that wasn’t purchased with a coupon, find a way to get your hands on $100,000. After that, you can ease off the gas a little bit." - Charlie Munger

https://jayvas.com/charlie-munger-is-right-haul-ass-for-your-first-100k/

Once you are no longer living paycheck to paycheck, the game changes dramatically and the way you view money changes forever. 

Rich people have enough money so they don't focus on saving but they prefer investment as it can give them more money besides their income. I think if those individuals who don't have enough money work hard by spending less and saving more then they can also change their financial system with the help of their planning.

Nothing is hard if a person works for it therefore saving should be assumed as a compulsory strategy of life. The condition of nobody can change in a day so work for it and follow your planning until you become satisfied with your financial condition that becomes favorable due to your efforts.

Everything you said is correct but you didn't discuss about investing wisely. Investment is very important in the life of any individual that has started working to earn money. There's a saying "nothing last forever" If someone is earning money from a job and they believe they can work on that job for their entire life, they can get disappointed when table turn against them but if they invest while working they can enjoy the investment when they are no longer strong to work  hard. I just want to specifically say that investment is very good. While earning, don't fail to invest.

honestly if someone is so financially illiterate they are just few steps away from meeting some fund management if they are rich enough and then their wealth already guaranteed being managed by professionals and are.
but in some cases I agree with you though some people are just so financially illiterate they just never think about keeping their money from declining by overspend and what they think is just sports car, buying luxurious things and all, i personally even if i suddenly become rich but don't have any means of income that could at least guarantee my wealth safety i'd be anxious and will strive to make some come of income to compensate such as passive income by investing the money only then I can rest assured that the wealth gonna lasts for long and make sure the money gonna be working for me.

i've seen plenty of former celebrities and so on where they accumulate wealth so much the first time they get famous only to later on struggle financially, there are many cases of that and its not only limited to celebrities as a profession, any profession that doesn't guarantee income until the old age or at least until the age of retirement is always subject of financial struggle when they gets old since there's no means for them to earn and becoming self sufficient.

the fact that we need to reinvest thing to survive is essential for the low income people, for the rich with many wealth, its important to invest in order to keep wealth from declining, investing is always a necessity.

Nothing worse then someone who suddenly becomes rich and has no real experience in how to stay rich for the entirety of their life.   Then you have peaked and are only in decline from that moment of acquiring the wealth.    The best choice with wealth is security, its the one point I'm returned to continually that is entirely relevant to economics as I believe it drives the whole of capitalism in a big money sense at least.

The security of money is paramount or you really aren't rich at all, if you cannot sleep safe and secure knowing you can eat next week next month and be safe then you arent rich at all you merely have cash today.  Hence its all about security of your long term wealth that matters;  a vital lesson to learn.

Lifestyle creep.


"The rich shall rule over the poor and the borrower is slave to the lender" - Solomon, son of David, king of Israel. 

QFT

When you start thinking of and treating your money as an appreciable asset rather than just something to spend on goods a services, your entire life changes.

1. This is one big mistake people make! Once they start earning a lot, they begin to squander the money on luxurious things forgetting that there was a moment they had nothing. A song writer says, “when you’re at the top, prepare for the landing”. If only people knew this secret, they will make the most out of their very first salaries.

2. You should even owe anyone. Try as much to never owe so you don’t have any debt to pay. It is important so you don’t end up using all your salary to keep paying debt.

3. Same thing as 1.

4. It’s a flexible decision. It’s based on what the person is pursuing in life.

That only proves that rich people even become more thrifty in order to save more than to spend more. For me, that is a great mindset if you want to stay rich. And by staying rich it’s not necessarily that you need to make all out investments, sometimes even by saving a little out from your expenses will help you to remain rich by not spending a lot on your purchases, but by saving big when you spend big.

People who became rich out from hardwork and sacrifices, they don’t actually stop there and just settle on their present wealth. Instead, they set and work for a new goal to achieve, not just to grow their funds, but to increase their source of income as well so that if ever one business ends up into failure, at least there are still some left that would be reliable to generate profits. That’s how open minded the rich people are, they don’t wait for opportunities to come knocking at their door, but they always look and grab every opportunity as much as possible.

I remember shopping with my father once when I was younger.  We were shopping at Target (kind of like Walmart for those unfamiliar).  I remember running in to a man who had a handful of coupons.  He was a friend of my fathers and they had a nice chat and he went on his way.  I'll never forget my father saying "that is the richest man in our state, and even he clips coupons"  "those who get rich stay rich by making careful money and investing decisions".  He couldn't have been more right.

Most rich people who give advice about how to become successful haven't actually experienced what they say. They want to get public attention by making themselves appear as if they are hard workers who have achieved success. I see a lot of young rich people who provide motivation in the seminars they hold. They say that they can be successful because they work hard and don't give up. The funny thing is that they don't mention the privileges they get. They have connections with banks so they can ask for bank loans to open a business. If they fail, they can still pay it off and start a new business.

Correct, maintaining success is much more difficult than achieving it, and in many cases many people fail again after reaching a certain point in their lives. Basically we have to keep learning, so that we can adapt to the situations and realities around us, simply put, we have to be wise enough to position ourselves. There will always be an urge to spend the money we have other than for basic needs, in this case we must be very wise in managing our wants and needs. By understanding financial management correctly, we have calculations when we want to spend money.

On the other hand, only a handful of people can actually achieve a level of true financial freedom, but we can potentially follow in their footsteps by continuing to try. There is no other way to achieve financial freedom, other than continuing to learn and being consistent in the work we are doing. It's true, at any time we will be faced with various kinds of challenges, which if we respond incorrectly will lead us back to the brink of poverty. Quoting what the OP said, be a grateful person and don't be greedy, then plan for the ideal future and adapt to existing changes.

There is something that I am still not clear of. From the subject of the topic, you wrote, “Things to avoid when you earn a lot or become rich,” but down in the context, you are emphasising things that you should do when you start becoming rich. Am I the only one who still doesn’t understand or what? Because if you are explaining what to avoid when you become rich, I was expecting to see things like stop gambling, stop womanising, avoid pride, and many others, but I see you are emphasising on things that you should be encouraged to do when you become rich. I was confused, so I decided to ask. Although everyone makes mistakes and is serious, you are not new to the forum, which was the reason for the question.

Appreciate every achievement we have achieved and our hard work to achieve this. Because being able to gain financial freedom is certainly not an easy thing. Therefore, be wise in managing your finances and expenses, even if you have unlimited wealth. Don't feel like because you can afford it, you buy all the things you want. Because this behavior will only lead you to financial ruin.

Success is not the end of everything, sometimes maintaining success is more difficult than achieving it. There are still many challenges and difficulties that you will face, and be prepared for them all.

And for those of you who are still struggling to gain financial freedom, keep your enthusiasm and never give up, because failure is not the end of everything, but the beginning of your long journey.

In my opinion one of the most important things you need to avoid when reaching a comfortable level of wealth is the people that may like to take advantage of that and suddenly they want to become your best friend, so it is important to remain skeptical about such people, as if they are unable to get anything out of you for a time, it is likely they will get tired of waiting and their true colors will come out, allowing you to see them for who they really are.

You definitely don’t want to gather too much attention on yourself. You’ll have many problems when people discover you and your wealth. Long story short you will become a target. Scammers, hackers, gold diggers, fake friends, stupid relatives… The moment they know about it, you’ll be getting calls from your friends which you haven’t seen for 20 facken years. Some of them will want to borrow money, some of them will use their mom’s sickness for an excuse… In the end you’ll hate yourself for being rich unless… you play that smart and live a low-key life.

Obviously you shouldn’t look like you are living in poverty but let’s say that you shouldn’t drive a lambo but a benz or audi is probably going to be OK.