Top 8 secrets to wealth

If you've been following Current Events with Patrick Cook, you'd know that our theme for this year is Getting Healthy: Physially and Finacially. If you have not, click the follow buttion to get frequent updates about healthy living and financial tips. 

 
Here is a great article, written by Kevin Chappell, on "What separates the rich from the rest." They are three components of the article that I would like to draw attention to -  but first let's look at the opening: "Think you could never earn enough to be wealthy?

Think again. Financial experts say income alone explains just 5 percent of the wealth disparities in the United States. That’s why some of the lowest-earning households in terms of wages have managed to accumulate significant wealth.

 

So what do the wealthy know that the rest of us don’t? Plenty. But the good thing is, their secrets are far from rocket science. Most are common-sense money managing practices that rely on everything from simple laws of human nature to simple math we all learned in grammar school."

 

The author list 8 secrets, but of the eight 3 of them resonates with me really well.  Therefore, I chose to enumerate them here.  Post your comments and weigh in on how you measure up to the wealthy. 

  

1. They have spending plans, not budgets. Believe it or not, the wealthy also budget their money. But rather than an unrealistic detailed budget that lists every purchase, such as morning coffee, dry cleaners and gas, they employ a strategy of weekly or monthly spending plans or smart estimations. The wealthy know that budgets get blown, and spending plans don’t.
    
2. They spend less money than they earn. The wealthy will underestimate their incomes and overestimate their expenses to create a favorable bottom line. They use their net worth as the ultimate scorecard to determine how well they are doing.
    
3. They borrow money as leverage. The wealthy are constantly looking to increase their assets and reduce their liabilities. They borrow money only as leverage to invest and help them make more money. In other words, they use debt and do not let debt use them.

 

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