7 Money Rules Nobody Teaches You In School
School shows you how to write essays and solve equations, but it fails to prepare most children for money matters. As such, the majority of people go through life, living paycheck to paycheck, without a real plan in place.
When it comes to money, income isn't actually that big a deal. Yes, it can help to some extent, but what really counts is consistency over time. If you can save your money at regular intervals, say, over twenty years, you can achieve remarkable results that give you the freedom to do all of the things that you want to do in life.
In this post, we take a look at some essential money mindset rules that teachers never tell you in school.
Rule 1: Change How You Think About Money
If you believe you're going to be rich, you probably will be. Likewise, if you think you will spend your entire life in poverty, that's probably also true. That's because your money mindset is the biggest driver of success and failure over the long-term. When it comes to our finances, our beliefs are often self-fulling.
Don't be one of those people who hates the rich or loves to be poor. Instead, adjust your money mindset and abandon scarcity. Making money is something that anyone can do, and you have a long time to do it.
Rule 2: Remember That You Only Get Money If You Offer Value
Many people believe that money is a birthright. And in countries around the world with a welfare state, it is.
However, unless you use the government, money is only something you get if you offer other people real value. It has to be an exchange.
We all know this on a practical level. But on a personal level, we don't always feel it in our hearts. We believe that our bosses or customers owe us money just for showing up, regardless of the actual amount of value we generate.
If you often find yourself slipping into an entitlement mentality, try to catch yourself. Remember, nobody owes anyone any money, unless there is an exchange of value.
Rule 3: Leverage Money-Making Skills
Taking an online trading course can be a great way to leverage your existing capital and make more money from it. Instead of just passively investing, you can look for opportunities in the markets daily for outsized returns.
Rule 4: Never Spend More Than You Make
Many people are tempted to spend more money than they make. This then puts them in a world of pain. They feel like they are salmon, trying to swim uphill their entire lives, never actually getting anywhere.
The trick here is to spend less than you make – much less. While saving 10 percent of your income for your entire working life will provide you with a nice retirement, if you want to get ahead, you'll want to save more than this. 30 percent is a more realistic figure for achieving your goals if you earn an average income.
Rule 5: Remember That Time Is Not Money
Many people are of the mindset that time and money are interchangeable. However, if you are clever about it, you can separate them.
Why is it that company leaders can make so much money? It's not because they are working 400 hours per week. Instead, it is because they are leveraging scale in their organisation to make sales, even while they sleep.
As someone looking to make more money, you should try to do the same. Find ways to make money that don't involve giving up more of your time. For instance, you could give a course to 100 people online, instead of just one, or you could invest in machinery that can perform tasks you normally do by hand at a much higher rate.
Rule 6: Serve People
The more people you serve, the more money you make. Therefore, if you want to make the most of your financial life, serve as many people as possible. Look for opportunities to scale your business offering perhaps online or to customers in neighbouring towns and cities.
Rule 7: Make It Personal
Lastly, it always pays to build a personal brand. The more personal scarcity you can create by making yourself look different from other people, the more money you will make.
This applies just as much in the corporate world as it does in the personal one. If you are an individual, like Gordon Ramsey, or Johnny Depp, you can charge pretty much whatever price you like for your services.