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We’ve turned into a rather image conscious and materialistic society. How we appear to others is important, and many of us use credit and get into debt to look rich. Indeed, acting rich — as though we’ve got money to burn — when we really don’t is why so many of us are far from being rich. This type of mentality can put our current financial situation at risk, as well as damage our chances for a prosperous retirement.
But how can you accumulate real wealth? Well, the answer lies in the #1 rule of personal finance: Spend less than you earn. Living within your means is the first step to being rich. Rather than focusing on whether or not you look wealthy, focus on living within your means so that you are comfortably able to grow your wealth. This will ultimately help you improve your situation and see a higher net worth.
Indeed, Thomas J. Stanley, author to The Millionaire Next Door and Stop Acting Rich…and Start Living like a Real Millionaire, points out in an interview with Bankrate (and featured on Yahoo! Finance) that most millionaires in this country are not the glitzy, free-spending celebrities that we see. Instead, they are regular people with the discipline to live within their means.
That’s something to think about. Most millionaire households live in homes valued at less than $300,000, according to Stanley. So while you are trying to look as though you have a great deal of cash, the guy next door may actually be a millionaire.
Image source: prawnpie via Flickr
879 days ago
[...] So, even if you don’t spend more than you earn, it is still important to be careful of who you trust, and try to avoid giving any one person too much control over your financial future. But, in the end, true wealth is built little by little, with prudent decisions, and by living within your means, rather than spending everything — and then some — on a lavish lifestyle. [...]