The formula for becoming rich is actually quite simple. According the many of the self made billionaires in the world these are the steps to becoming wealthy for common folks (like you and me).
Step 1: Save like a maniac. The self made rich had to start somewhere. They are usually frugal early in there lives and take jobs or start small businesses at young ages. When they start getting a little money they save it and reinvest in their small business. If there is nothing to reinvest in they save. Most folks like to live at the level where they spend $1 of every $.80 they make, no matter how much they make. The self made rich spend about $.20 for every dollar they make and save the rest. These savings are their ticket to freedom but most of them don’t think of it that way. They save out of instinct and really enjoy it.
Step 2: Become an expert (or micro-expert) in a subject you’d like to make money in
Become passionate about an area of learning and master it. Listen to every single podcast you can find, read periodicals, magazines, newspapers, blogs, and anything you can about the subject you’re interested in. Become extremely knowledgeable about the inner workings of the investment vehicle you are going to ride out of poverty in. Don’t waste a minute watching TV, arguing with people online, or reading trivial facebook updates. Instead, read all the books you can find on your subject of choice, meet up with people in that area, attend lectures, go to tradeshows. Do everything you can to master your topic. Notice that there isn’t a set path of what you should be following. Obviously you don’t want to become a powerless academic that only knows the theory of how things work, you’re eduction will be much deeper than this.
Step 3: Go “all in” when the opportunity arises – When opportunity arises, usually through a change in the market, you will be ready to put all your chips in and be much better positioned than anyone else. In fact, because you know so much about the field you’re investing in you were actually anticipating the change everyone else was blind sided by. Going “all in” means you give this opportunity all of the savings you have saved up and give it 100% of your energy and time. Like a pitbull you don’t let go until you ride this ride for the full time. People that don’t understand what you understand will be alarmed or completely baffled about what you’re doing but don’t let that distract you. You know exactly what you’re doing. The first time you do this it may mean the difference between freedom and running in the rat race until you retire. With the new found freedom your confidence, resources, and deals will get bigger. The vivacious saving, learning, and deal finding only gets bigger with time and the formula is repeated.
Always Be Taking Action Those that bootstrap their ways to riches do so by always taking action, always progressing, and always finding ways to make things work. As long as you find ways to take action, instead of making excuses, you’re well on your way.