It’s been long since I read the Kiyosaki’s Rich dad Poor dad which offered an actionable information in his explanation of assets, liabilities, and balance sheets, all of which can be boiled down to “spend money on things that generate income – not on expenses.”
The rosy picture painted by Kiyosaki sounds good but very difficult to work in real life. However, there was an interesting interview published on Adam Khoo – Singapore based millionaire who offered some very important tips of how to be rich. Before we discuss those tips, First, let’s define:
What is Money?
Academic definition of Money, according to economists, is a medium of exchange, store of value, unit of account. However, we are living in the time where economic system is the engine which is running this world. So in the context of social sciences, Money is a wealth that is related to source of status and social prestige, a provider of physical and psychological security, a contributing factor to human welfare and well-being, a basis for military strength, a source of public influence and political power.
We all know money is a powerful tool for economic growth but ordinary people always find it difficult to make money and get rich. So Adam Khoo – the Youngest millionaire at the lunch of his latest book ‘Secrets of Self-Made Millionaires‘ gave an interesting insight about how to be rich?
Power of Money
He said, “Some of you may already know that I travel around the region pretty frequently, having to visit and conduct seminars at my offices in Malaysia , Indonesia , Thailand and Suzhou (China) . I am in the airport almost every other week so I get to bump into many people who have attended my seminars or have read my books.”
Recently, someone came up to me on a plane to kuala lumpur and looked rather shocked.
He asked, “How come a millionaire like you is traveling economy?”
My reply was, ‘That’s why I am a millionaire. ‘ He still looked pretty confused.
This again confirms that greatest lie ever told about wealth. Many people have been brainwashed to think that millionaires have to wear Gucci, Hugo Boss, Rolex, and sit on first class in air travel. This is why so many people never become rich because the moment they earn more money, they think that it is only natural that they spend more, putting them back to square one.
The truth is that most self-made millionaires are frugal and only spend on what is necessary and of value. That is why they are able to accumulate and multiply their wealth so much faster.
Over the last 7 years, I have saved about 80% of my income while today I save only about 60% (because I have my wife, mother in law, 2 maids, 2 kids, etc. to support). Still, it is way above most people who save 10% of their income (if they are lucky).
I refuse to buy a first class ticket or to buy a $300 shirt because I think that it is a complete waste of money. However, I happily pay $1,300 to send my 2-year old daughter to Julia Gabriel Speech and Drama without thinking twice.
When I joined the YEO (Young Entrepreneur’s Organisation) a few years back (YEO is an exclusive club open to those who are under 40 and make over $1m a year in their own business), I discovered that those who were self-made thought like me. Many of them with net worth well over $5 mln, traveled economy class and some even drove Toyotas and Nissans, not Audis, Mercs, BMWs.
I noticed that it was only those who never had to work hard to build their own wealth (there were also a few ministers’ and tycoons’ sons in the club) who spent like there was no tomorrow. Somehow, when you did not have to build everything from scratch, you do not really value money. This is precisely the reason why a family’s wealth (no matter how much) rarely lasts past the third generation.
Thank God my rich dad foresaw this terrible possibility and refused to give me a cent to start my business.
Then some people ask me, ‘What is the point in making so much money if you don’t enjoy it?’ The thing is that I don’t really find happiness in buying branded clothes, jewellery or sitting first class. Even if buying something makes me happy it is only for a while, it does not last.
Material happiness never lasts, it just gives you a quick fix. After a while you feel lousy again and have to buy the next thing which you think will make you happy. I always think that if you need material things to make you happy, then you live a pretty sad and unfulfilled life..
Instead, what makes me happy is when I see my children laughing and playing and learning so fast. What makes me happy is when I see my companies and trainers reaching more and more people every year in so many more countries. What makes me really happy is when I read all the emails about how my books and seminars have touched and inspired someone’s life.
What makes me really happy is reading all your wonderful posts about how this blog is inspiring you. This happiness makes me feel really good for a long time, much much more than what a Rolex would do for me.
I think the point I want to put across is that happiness must come from doing your life’s work (be it teaching, coding, building homes, designing, trading, winning tournaments etc.) and the money that comes is only a by-product.
“Money is not a motivating factor. Money doesn’t thrill me or make me play better because there are benefits to being wealthy. I’m just happy with a ball at my feet. My motivation comes from playing the game I love. If I wasn’t paid to be a professional footballer I would willingly play for nothing” – Lionel Messi