7 things that differentiate rich from poor

And how to eliminate the difference & progress towards the top

Source: CNBC.com

There’s an elemental difference in the financial chain between the people at the top and the ones at the bottom.

The difference is so elementary that the ones at the bottom hardly even notice it. And the ones who notice it, are the ones who actually jump the bar and the reach the top of the chain.

Sure, it takes time for them to reach the top, but who doesn’t? People who’re at the top were at the bottom of the chain, once upon a time.

That’s how it works.

This post is for those who want to break the barrier and set them free to reach the top of the chain.

Before I begin, I’m admitting that this post isn’t about ‘get rich overnight’. This post is only for those who believe in the compounding and grinding their way to the top.

The ones who believe in the process, progress & practice.

If you’re the one, this post is for you. If you’re looking for some quick schemes to get rich quick, I’m gonna save you time — please quit reading this post.

Because people who’re looking to get rich overnight aren’t ready to put effort, use their brains or both.

What I’m going to share here is ridiculously hard, it will break you but make you eventually.

It will put you to test at your worse and bring out the best out of you in the end.

Read on if you’re looking for legitimate ways to break the barrier.

#1 Invest in education than entertainment

I understand.

Humans need to relax with entertainment. I know Netflix & chill is a necessity now. I know you’re working hard to pull the strings.

There’s no harm in getting entertained by various channels. I do it myself.

But are you investing in educating yourself?

I’ve understood this hard way. I was poor at math since the beginning.

All I could do is get passing marks and flea away with the exams.

Now that I have to deal with numbers in the real world, I understood what have I missed as a child.

I don’t have anyone to blame for this but me.

I was wrong back then, maybe a little immature & ignorant. But not anymore. I’ve not invested money, but I’ve invested more important than that — my time, which is priceless.

I’ve practiced a lot of operations that involve numbers. The fastest way to calculate the percentage, multiply, add & subtract. Just the basics.

Once I’m really good at it. I’m gonna switch to statistics. That’s what I’m chasing right now.

Also, this is just one of many things I’m educating myself right now.

I have a lot of things on the bucket list that I need to learn.

The reason why education makes you rich is the fact that education directly reciprocates to pure knowledge which you can apply in the area of your interest & achieve the richness.

Education teaches you to apply what you’ve learned. It’s the application that makes the difference.

Knowledge isn’t power. What you do with the knowledge is the real power.

The rich invest in educating themselves, and the poor, Netflix & chill.

Times when the internet is taking over everything, this is the right time to double down on educating yourself.

Get the ball rolling, let it snowball and compound.

Here are a few things you can do to educate yourself:

  • Read non-fiction books & blogs that interests you
  • Enroll for free courses on Udemy, Coursera or Edx (there are many such portals for learning)
  • Keep in touch with the latest news of the topic you want to educate yourself for.
  • Write journals/blogs about your experience you got from applying what you learned in the first place. This will be the best thing you’ll do to validate your learnings.

#2 Have a plan and stick to it

Do you know why the billionaires are punctual to the last second?

They value time than anything else. Not money, not the power that comes with money, not the freedom & the lifestyle — it’s the time.

Everything can be regained back (if lost), however, time is malleable, still, you can’t gain it back.

And the best way to respect the time you’ve got is to plan every day of your life, to the degree of seconds and stick with it.

“The problem is, people think they have time.”

Planning is crucial to managing your time, especially when you have very little of it. No matter what’s your business model, the level you operate at, your financial background.

I’m a digital marketer and I help entrepreneurs & business owners get more business online. So, it becomes more important than ever to keep track of my own time so that I can meet the deadlines for my clients before time.

Though I miss some of the deadlines by small margins, that shouldn’t happen.

Time is money.

If I’m missing the deadlines, I’m not only dumping my client’s time, I’m also losing money by working on yesterday’s work, today, where I can work on new money-making projects.

I’m not emphasizing on money, but I’m laying monetary importance on the planning part.

The problem with the poor, they do almost everything unplanned — and I hate more than I can admit the fact that the poor find a ‘kick’ in doing so.

Time is a luxury.

If you don’t choose & plan to spend time on things that are important right now, you’ll not have the privilege to choose what you want to spend your time on, years from now.

The ones who plan their day, sit and check what they’ve accomplished during the day. Even if it’s one of the many tasks that they could complete.

At least, they’d stay on the track of doing more the next day.

Here’s what you can do to plan your day:

  1. Block your time for tasks for the next day. I use Google calendar to do that. I have it pinned in my browser.
  2. Prioritize the tasks, with highest at the top. I have 3 tasks. Nothing more than that.
  3. Begin your day early & by reviewing what you did yesterday. I do it by editing my previously published work. It helps me get in the flow.
  4. Put your smartphone on DND until you’re done with your day. Just calls must be reachable, nothing else. This will help you stick to the plan. I work for 12 hours, and my smartphone stays in DND mode from 0900 to 2100.
  5. Set a goal that you want to achieve by the end of 5 years. Plan your tasks for the goal in months, weeks, days & minutes. I understand this sounds too much, but that’s how you’ll plan your time & save more time

#3 Apart from time, Invest money to buy assets

This is the biggest difference that borders the rich and the poor. The rich buy assets first, and they spend from the return that they get from the investment.

The poor spend without investing anything.

The magic here is compounding. The rich invest in assets and live lavish lifestyles using the ROI, while the principal amount/assets remain intact.

They invest more, increasing the principal amount so high that they have enough ROI to reinvest after taking care of all their inevitable expenses.

They invest so much that there comes a point where they’re not spending a single dime of their own. It’s just the ROI that runs their lives.

I don’t want you to replicate Warren Buffett and invest all you have in stocks. Start as he did.

He used to sell coca-cola bottles and invest the profits to buy more bottles and make more profits. He used to do this door-to-door since he didn’t have the channel as we have right now, you don’t have to do that.

You can do the same thing online, without worrying about the infrastructure cost. All you need is a laptop, a decent internet connection & a brain.

The online business you create is an asset that will make money for you when you’re asleep, on a vacation or just doing nothing.

“If you don’t figure out a way to make money while you’re asleep, you’ll have to work for the whole life of yours.” — Warren Buffet

One of the many ways you can do that is by starting a blog. If that’s too much, for you, think of some ways you can leverage the human presence on social media. Facebook has just announced that the user base hit 2.5B in Jan’20.

There’s Instagram, there’s YouTube, there’s TikTok. Pick a platform that already has your target audience and begin doing what you love.

Once you start creating some traction, people will gather around you and you will make money no matter what.

Imagine if you can reach 1% of it and make $10 from 1% of that 1% you reach.

A blog isn’t just one asset that will pay off later. You can buy stocks that pay a dividend, buy real estate assets, drop ship products, … and what not?

There’s an ocean of opportunities, are you willing to jump into it?

The trick here is to build an asset that pays your bills, for the rest of your life. And, you have to figure that out, what asset you will be building.

#4 They pick up the right things using decision minimalism

Here’s the biggest misconception.

The poor think that the rich spend a lot of time finding themselves the best business model.

A business model, that will reciprocate into a highly successful business within a few months.

That’s not a complete truth.

The rich do spend a lot of time finding the right business. But they don’t spend much time on finding the right thing to do.

They already know the right thing to do — it makes the most of their time, energy & all the resources available to them.

Knowing the right thing comes from experience and knowing their target audience.

Obviously, the rich don’t earn their fortune by working 9 to 5. So they have a business which further has a target audience.

And knowing the right thing comes by knowing their target audience. It’s the attention to detail that makes all the difference.

Picking up the right things isn’t luck, it’s science, it’s art.

Furthermore, knowing the right thing to do involves the superhuman ability to say “no” to almost everything that comes their way — even if it is a better opportunity.

The trick is to stick to the right thing, no matter what, and adding the “better things” in the bucket list or the to-do list.

Apart from this, it’s the ability to make decisions. I’m a big believer in ‘decision minimalism’.

I’m traveling from Nagercoil to Chennai. Nagercoil is a beautiful place in south India.

Nagercoil, Tamil Nadu — India

I decided to take a bus to Chennai, instead of the train. Turns out, I’m enjoying the journey soon after it began.

The point is that I didn’t spend much time & energy in analyzing the prices, other routes, best-favorable options to reach the destination.

I simply booked the tickets and board the bus. I had no plans of working on this post, but while I’m on the bus, I’m gonna publish it right here.

That’s how doing the right thing works. One of many of those ‘right things’ is the decision minimalism.

Decision minimalism is one of the most precious traits that the rich have(and the most precious trait I’m practicing right now), and it’s not an easy nut to crack.

#5 They take one step at a time

It seems that people have dedicated their attention to the wrong thing. Seeing billionaire having multiple sources of income, we perceive that they’ve been multi-tasking.

It’s both true & wrong.

It’s true because the rich do have multiple sources of income.

It’s wrong because they don’t focus on every source of income all at once.

If you’ve not already read Eat that Frog, let me tell you what that book has.

The author simply teaches us to prioritize our daily tasks with a simple trick. In this context, all you have to do is take the step that’s the toughest.

Be it starting up that blog, reaching the running milestone, or having that ripped physique, or writing 10,000 words a day for the rest of your life.

Begin with that toughest morsel to swallow.

There’s a reason behind that.

I, as a kid, have always faced issues finishing my test on time. I’ve always had lesser time to finish the paper, no matter how fast I write.

My approach was wrong. I used to attempt the easier questions first.

I was told by my teachers to begin with the toughest ones. Even after repeated guidance, I couldn’t adapt to this approach.

I ended up leaving some questions unanswered even though I had the right answers.

Part of taking one step at a time is knowing the right step. As we’ve seen in the previous section, knowing the right thing requires to spend time & energy deciding ‘the right thing’.

The trick here is believing in the magic of compounding.

Compounding is the eighth wonder of the world — Albert Einstien.

If you keep doubling your money every day, starting at 1 cent, you will be a millionaire in 27 days.

#6 They play the long game

Rome wasn’t built in one day, but sure it was dreamt every single day.

Every other day I come across people who want to get rich quick. They try all sorts of non-sense quick money-making schemes & end-up either losing all that they have or even worse.

The rich people have a mindset of projecting themselves 10,20,30,40 years from now.

They picture themselves in a position they’re working their ass off, today. They visualize, introspect & materialize what they’d become years from now.

The ultimate goal is burned down to months, weeks, days & hours — and some times, to seconds.

Remember Arnold’s first interview where he says he will become the highest-paid actor in Hollywood?

Everyone laughed at him saying that no one would such highly build bodybuilder as an actor.

He didn’t give up on his goal & rest is history….

#7 They’re good readers

In an interview, Warren Buffett & Bill Gates was asked what was the one thing they’d like to have to rest of their life? (I don’t remember the exact words, but this was the context of that question)

Both of them were asked to write down their answer on paper. The interviewer then asked them to reveal their answers. Both revealed it and they had the same thing written “Focus”.

This was a bit of background for the point I want to discuss herewith.

One of all the universe full of good reason one should read books is the focus you get while & after doing this exercise.

I consider reading as an exercise, a meditation.

You’re required to be hyper-focused in order to read a book & understand it. Our brain is wired to feel uncomfortable when it doesn’t understand what it reads. It’s chaotic for the brain.

Bill gates, once the richest person on the planet, still reads at least 50 books a year. Books are the tools that very few people cherish.

I think reading is important and not the genre you chose to read. It’s all about practicing to focus. If you’re planning to gain knowledge, then you better pick great books & topics to read.

These were a few traits that I have observed in rich people. Again, “the rich” that I’ve mentioned here are people with a mindset of “the rich”, and not the money.

I’ve got the inspiration for this post from multiple sources, some are books, case studies, interviews, & personal experience. I’ll keep posting such stuff on this profile.

Feel free to follow my work and join my newsletter to get only important updates.

Until next time…

Writing about Blogging, Branding & Marketing | 1.7M views on Quora | https://shubhamdavey.com/ | Hit Follow ⤵

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