Secrets of how the RICH spend their money!

Why learn how the rich spend their money? Because being rich isn’t so much about how much you earn, as how much you spend. That is such a big statement that I’m going to repeat it so it really sinks in: being rich isn’t about how much you EARN, as it is about how much you SPEND. And there are three main categories of spending where the rich differ from the rest of us: clothing, housing, and transportation. And, at the end of this video, I’ll talk about what they do with the cash they save from these three areas. Because that also has a big part to play in how they are able to generate wealth.

I’ll discuss what they do with the money they save from these three areas at the conclusion of this article because it plays a significant role in their ability to create wealth.

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Most wealthy people don’t worry about brand names or the cost of garments; instead, they dress simply in t-shirts and jeans because they feel good in them. They are already prosperous and secure, so they don’t need to flaunt it. One characteristic of affluent people’s wardrobes that I find appealing is their preference for well-made, high-quality clothing over fashionable items. They rarely shop at the mall and maintain tight spending limits. You wear clothing to protect your body from the elements.

Most wealthy people don’t worry about brand names or the cost of garments; instead, they dress simply in t-shirts and jeans because they feel good in them. They are already prosperous and secure, so they don’t need to flaunt it. One characteristic of affluent people’s wardrobes that I find appealing is their preference for well-made, high-quality clothing over fashionable items. They rarely shop at the mall and maintain tight spending limits. You wear clothing to protect your body from the elements.

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If you know me, Shiv, you will be able to see that while I like to look great, I’m absolutely not someone who goes out and purchases really costly labels for the sake of appearing fancy. This is not a sign of financial worth. I’d rather spend my money on a lovely outfit from T.J. Maxx than on something similar from Saks Fifth Avenue that costs ten times as much. There’s more on that at the end of the article.

Although a home is the second-most important thing you’ll ever own, did you know that most wealthy individuals opt for modestly sized residences instead of larger ones? They understand that excess room is a waste of money because it takes longer to maintain and is more expensive to heat or cool. To keep their monthly cost of living at roughly $1200, they would prefer to purchase a 2000-square-foot home that costs 700 per month, with property taxes of about $250 and utilities of another $250. Rich people carefully consider their purchases every month; they don’t mind if they only have room for a modest residence as long as they can live comfortably and save money.

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Rich people don’t buy things to flaunt their wealth; instead, they want reliable low-cost goods. For the majority of people, their car is their second largest spend after their home. If you gave them the option to choose between a Toyota Camry and a Ferrari, they would nearly always choose the Camry due to its dependability and affordability. Your typical Toyota Camry’s insurance price is about $ per month. Over time, buying a reliable but economical car will increase your wealth. They can save more than $2,000 a month if we combine their bills for housing, cars, and clothing. They then utilize the excess cash to purchase assets that will generate income.

This distinguishes the wealthy from everyone else. Assets provide income, which can be utilized to invest in the stock market, which historically has produced returns of roughly 8% annually, or an additional $2,000 or $1,500 per month. The key is that the wealthy spend less on liabilities and invest more in assets. If they invest that money when they are 25 years old and keep investing until they are 45, they will have more than 1.1 million dollars, which is more than enough to retire.

Successful people invest in dividend-paying companies rather than going out to eat every week, buying new clothes, or getting expensive cars. Rich people use their additional money real estate growth stocks or etfs to better themselves. They enroll in courses that will help them advance their careers or gain new skills, and they go to the gym or work out at home to stay in shape. Despite the fact that they may spend money on travel, they prioritize lasting experiences above penthouse accommodations at the Bellagio.

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They would rather visit queen cafés and restaurants than go on instagram-worthy beach vacations or eat at Nobu. Here’s the thing: Although I only covered three categories in this article, the majority of us actually spend the most on clothing, housing, and transportation. The mindset of cutting back on expenses and using the extra cash to invest in assets to build wealth, however, applies to all areas of your life where you spend money, including food, utilities, education, and anything else. Just keep in mind that being wealthy isn’t about how much money you make; it’s about how much money you spend.

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Secrets of how the RICH spend their money!

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