I want to spend just a little bit of time this morning with the concept of wealth. As it has been documented on many financial websites, the majority of America lives from paycheck to paycheck and has, for the most part, given up on the mindset of being debt-free. Along with the abandonment of this mindset goes the pursuit of financial freedom. Yet, there is a way that a person can live free of debt and be financially stable.
It is a hard road to travel so many people will not pursue it.
Trent Hamm takes a look at this process in this post on the Simple Dollar. As is typically the case, Hamm covers all the bases so there is very little that I can add to what he has already stated. However, I will sum it up in this post and highly encourage you to hop on over to his blog and digest the entire article. Trust me, tons of great information here.
Hamm is basing his article off of the conclusions he gathered from The Millionaire Next Door by Thomas Stanley and William Danko (You can get a hardback copy on Amazon for one penny and shipping). He concludes that….
First, people who accumulate wealth are usually quite frugal and rarely flaunt their wealth.
Second, one of the best ways to accumulate significant wealth is through self-employment and entrepreneurship.
Finally, financial success comes not just from money management, but from how you live your life as a whole.
Seems easy right….
Essentially, stop working for other people and work for yourself. Then, stop spending all of your money and live a frugal life.
Hamm goes on to explain how you can reach those goals…
Don’t Flaunt Your Wealth
Look for Routes to Self-Employment and Entrepreneurship
Build Strong Family Relationships
Build Strong Professional Relationships
Identify and Set Goals for Yourself
Make Smart Choices for Your Biggest Purchases
So, there it is. As I’m reading over this list, something occurred to me that I don’t think I have ever really considered before. Many people live there life so that they can accumulate wealth but this seems to work against the logic of the frugal minded and wealthy. It appears that the people who are truly well off in this life have done the exact opposite. They have accumulated wealth so that they can live their life. I hope that makes sense and that you can see the difference.
It really is about priorities.
What is important to you?