5 Lessons A Millionaire Taught Me

I want to make a lot of money! So I am always curious to learn more about money, earning more and managing the money! I saw this book “5 Lessons A Millionaire Taught Me” by Richard Evans, and I had to learn the lessons! I did learn a lot, and I thought they are worth sharing. So here are the notes from the book!

The Basics

• If you don’t control money, it will most definitely control you.
• Money is not the root of all evil; the love for money is.
• More often than not, the more successful people in life, those who are well-educated, are those who are poor at managing their finances.

The five lessons are:

1. Decide to Be Wealthy,
2. Take Responsibility for Your Money,
3. Keep a Portion of Everything You Earn
4. Win in the Margins
5. Give Back

Lesson One: Decide to Be Wealthy

• Though it’s important to make your money grow, what’s more important is personal growth in all aspects of your life.
• Those who think about money more than they should are those who are hand-to-mouth, who live from paycheck to paycheck.
• Don’t make the mistake of equating wealth to extravagance. Those who lead extravagant lives are those who just recently acquired wealth, have absolutely no idea how to handle their finances, and want the world to know how rich they’ve become. The genuinely wealthy people, on the other hand, are always on the lookout for accumulating more wealth and cost-efficient purchases.

Lesson Two: Take Responsibility for Your Money

• Initially, you’ll have to find out (1) how much you have, (2) where your money is coming from, (3) where your money is going, and (4) what your money is doing for the time being.
• Taking care of your money is similar to taking care of your pet or your children. You can’t just leave them alone and hope that nothing bad will happen to them. You have to set boundaries. You have to take control as to what they can do and what they cannot.

Lesson Three: Keep a Portion of Everything You Earn

• Examine the lives of some people when it comes to handling their finances.
• What’s important is not how much you earn now, but what you keep for yourself and your family in the future.
• Keep aside at least 10% of your income for future. And earn compounded interest on it.
• To be able to encourage and motivate yourself, you’ll need to see tangible results, something that is actually growing before your eyes.
• Should you pay all your outstanding debts off at once first before starting to save? One good suggestion, is to use 10 percent of your income to repay your debts and then another 10 percent for your nest egg.

Lesson Four: Win in the Margins

• Wealthy people look for other means to increase their income and savings.
• When you start regularly earning on the side, even just a percentage of your monthly salary, you’ll be able to accelerate the rate of growth of your wealth.
• Everything in this world was and is designed to take you money from you.
• You can still buy whatever your heart desires…but only if you have the money and if you’re definite that you’ll still want it after having to pay for it months or even years after.
• If you’ve managed to bargain for a lower price, put away the difference and add it to your nest egg.
• Three questions to ask yourself before buying something: (1) Is this expenditure really necessary? Or is it possible to get the same personal effect without using money or using less of it? (2) Is this expenditure contributing to my wealth or taking away from it? (3) Is this an impulse purchase or a planned purchase?
• Freedom and power are better than momentary pleasure.
• Too many people spend money they haven’t earned, to buy things they don’t want, to impress people they don’t like.
• Spending does not equate happiness.
• The simple things in life are what bring you the greatest joys. And more often than not, the simple things in life are free.
• Protect your nest egg (investments)

Lesson Five: Give Back

• It’s ironic but sometimes, the only way to protect ourselves from our own money, the only way to protect our wealth, and the only way to make it grow, is by sharing it freely and wholeheartedly to other people.
• You always get what you give.
• Never forget that life is never about money. It’s about your relationship with God, with your family, and with your friends. It’s about love and honesty. It’s about sharing. And when you open yourself up, you will find the true meaning of success.

Some Practical Advice:

• Turn your hobbies into money-making projects.
• When grocery shopping, always bring a list and never shop on an empty stomach.
• When going out, try not to order drinks as restaurants charge way more than usual.
• As much as possible, your clothes should be hand-washable and can be ironed.
• Shop for only a few hours at a time.
• Install a water-flow regulator in shower-heads and toilet bowls.