Anyone can learn to be rich, it just takes the right training. If you want to learn how to become a doctor you can’t go and study the inner workings of a car engine and expect to be a good doctor. In the same way if you want to be rich you will need to study money and you will need to increase your financial intelligence. Although this may sound a little daunting it is not that difficult and it can help you to work less, earn more and live a happier life.
If you want to learn to be rich you need learn financial intelligence. Financial intelligence involves a few different things. You need to understand how money works so that you can make more money, hold on to more of your money, get a better return for you money, work less for your money and so you can leverage your money. It is impossible to cover everything you need to know in just one article. But I am going to go over the basic things you need to learn if you want to become rich.
You Need To Know How To Earn More Money
By earning more money I do not mean that you need to go back to college in order to become a doctor or lawyer (or some other specialist) so that you can earn a large wage working for money. The type of earning I am talking about can be done by anyone no matter what your current wage is.
In order to be financially free your passive income (income you don’t need to work for) needs to be greater than all of your expenses. No matter what your wage is you can begin to increase your income by purchasing assets that generate an income. The rich get richer because they buy assets that generate income first, and then they use the income generated from their assets to pay for their expenses and liabilities. If you want to be rich you need to learn how to earn more passive income by purchasing assets that create more cashflow.
You Need To Know How To Keep More Money
A lot of people fail to become rich because money gets taken out of their pocket as fast as it goes in. One of the biggest expenses in your life will be your taxes. Working for someone else you have very little control over how much you pay in taxes. In fact the government now takes your taxes from you BEFORE you get paid. But there are ways you can legally minimize your tax payments so that you can have more money to invest and you can become richer quicker.
In order to become rich you need to learn how to keep more of your money and how to stop people putting their hands in your pockets and taking all your money before you get a chance to invest it.
You Need To Know How To Budget Your Money
Most people only know how to budget for a deficit. Meaning that there is more money going out than their is coming in. Because they only know how to budget for a deficit they are constantly getting in more and more debt and their expenses are constantly going up. They are therefore tied to their job and they have to work harder and harder just to make ends meet.
If you want to be rich you need to learn how to budget for a surplus. Being frugal in order to have money plays a small part, but really you need to focus on increasing your income by buying assets that generate you income. By using your money to buy assets that generate you income you are always increasing your wealth. You can then use that income to purchase your liabilities such as cars and clothes. So it is important that you learn to budget for a surplus so you can constantly have more and more money to invest.
You Need To Know How To Buy Assets
Once you have at least learnt how to budget your money so their is some left over to invest you need to know what an asset is and you need to buy assets. Rich people get richer because they buy assets that generate them income. Assets put money in your pocket and liabilities take money out of your pocket. You can define an asset and a liability this way. If you were to stop working an asset would pay you and a liability will take your money away. If you want to be financially free then you need to know the difference between assets and liabilities and you need to buy assets.
You can learn to be rich easily by learning the difference between assets and liabilities and by learning how to buy assets that generate an income.