In my 25-year career as a financial educator, I've met many wealthy (and famous) people, from your typical “fighting” types like James Packer, Mark Bowlis, and Aussie John Symonds, to highly successful former surfer Layne Beachley and fashion designer Collette Dinnigan.
This humble finance professional once partied with Bono from U2 at the London launch of a film made with tax-deductible investments.
And what I have witnessed with all of these “money types” and others is that there are money types. Most, but not all, people who have accumulated decent wealth share five common characteristics: I consider them attributes of abundance.
Wealth Trait 1: Having wealthy parents
This is more a case of great luck in life than of character. But if you surround yourself with the temperament to generate money, not just money, then you're half successful. What do you think was the main lesson media mogul Kerry Packer wanted to impart to his children? It certainly wasn't a love of literature.
Younger generations are often born with a sense of money, even if they didn't inherit a fortune. The good news is that if you come from a family that's good at money, you also acquire a kind of “osmotic expertise.” By observing and learning from people who are good at money, you too can improve your financial knowledge.
Also, Nicole Pedersen McKinnon:
Characteristic #2 of the wealthy: They don't do anything for free
Doing something without compensation is a “weakness” that doesn't create wealth, and it's not something that many rich people do, at least not on their way up the ladder. This is a related concept to knowing your worth and being willing to hold out until you get it. I won't name names, but being a little stubborn can help.
Wealth trait 3: Solidity
Billionaire American investor Warren Buffett is known for buying old and even hail-damaged cars, telling Forbes magazine last year that he saw no reason to replace his latest 2014 model because he doesn't drive it very far.
Compare that to the rich average person you know who is overworking and stressing themselves out by driving extravagantly. lease vehicle.
In fact, frugality and value-seeking are at the core of Buffett's wildly successful investment philosophy. If you think your wealthy friends are going to treat you to dinner, think again. They'll be whipping out their calculators before you've even finished your meal. You don't build wealth by overspending.
Wealth Trait #4: Bold
Risk tolerance is a distinct continuum, like the person who is nervous about flying and the passenger who wants to parachute out of a plane. Wealthy people are almost always the risk takers who jump or dive. They believe in the opportunity they are pursuing, and they often risk everything because of that belief.
They are also willing to leverage — borrow — their businesses rather than growing them slowly and carefully on their own.
Seven-time world surfing champion Layne Beachley once told me when I was editor of AFR Smart Investor that the smartest and boldest move she ever made was buying her first property before the economic recovery, when she was on almost no income: She was earning just $20,000 a year when she asked the bank for a $144,000 loan for her first purchase.
“I saved all my winnings as a down payment and did everything I could to pay it off as quickly as possible. It gave me a stepping stone into the property market and gave me the assets to secure other properties and business interests.”
Similarly, TV's most influential presenter, Larry Emder, began investing his income in Sydney property at the beginning of his long and illustrious career, a bold and confident move that has seen him now own a vast portfolio. He is also one of the kindest people on TV.
Here I would also like to pay tribute to my lovely financial buddy, Paul Clitheroe. He may be a big believer in stocks, but his smart investment strategy is the epitome of slow and steady wins. But that hasn't stopped him. His yacht is aptly named, balance – Winner of the 2015 Sydney to Hobart race.
Wealth Trait #5: Get Your Hands Dirty
If you want to be successful, roll up your sleeves. No one has ever been successful by being lazy. If you combine the above traits with hard work, you can become very wealthy. In fact, you can Make an effort I aim to achieve this with single-minded determination.
Take Colette Dinnigan for example. She told me that the best business decision she ever made was to continue believing in the luxury market and her brand, rather than going commercial first. It was a great decision and it paid off.
When I asked Australian John Symonds what his secret was, he replied, “If anyone thinks there's a shortcut, forget it. When I started, I had no money, no backers, but I had a strong passion to make a difference. That was my goal.”
What do you think? Could a more prosperous future be within our reach?
Nicole Pedersen McKinnon is the author of How to Get Mortgage-Free Like Me, available at:Nicoless Smart MoneyFollow Nicole Facebook, twitter and Instagram.
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