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"How to tell if you are rich" by Alexander Green.

Friday, January 25, 2013

I would like to share an article titled "How to tell if you are rich" which was published 4 days after my blog post titled "If we are not rich, don't act rich!"

Although the writer used the USA as a backdrop, providing some numbers to show what households in the top 20%, 10%, 5% and 1% in the USA make and have, the ideas on wealth building are universal.


If we own a car like this, we are rich, aren't we?





Alexander Green is the name of the writer and I like his style!

If our households are amongst the top earners in the country, do we run the risk of being "demonized by those who view hard work and risk-taking as a matter of good genes and good fortune"?

If our households are amongst those with high net worth, do we run the risk of being "frowned upon by redistributionists who resent folks that live beneath their means, save regularly and handle their financial affairs prudently"?

Instead of complaining about how we are not rich when others are, try to be rich!





See if what Alexander wrote sounds familiar:

How do you get rich if you aren’t currently?

The basic formula is pretty simple: 

1. Maximize your income (by upgrading your education or job skills). 

2. Minimize your outgo (by living beneath your means). 

3. Religiously save the difference. 

4. And follow proven investment principles.





Most millionaires – folks with liquid assets of one million dollars or more – are not big spenders. Quite the opposite, in fact.

...the most productive accumulators of wealth spend far less than they can afford...

The wanna-be’s, on the other hand, are merely “aspirational.” ..... Their problem, in essence, is that they’re trying to look rich. This prevents them from ever becoming rich.





I like how Alexander ended his article: "If you want to be rich, you have to stop acting rich… and start living like a real millionaire."

Read complete article by Alexander here:
How to tell if you are rich.

Related posts:
1. If we are not rich, don't act rich!
2. The very first step to becoming richer.
3. Retiring a millionaire is not a dream!

14 comments:

Musicwhiz said...

Hi AK71,

Yes, more of such articles please. They resonate with me and I can identify with them (though I am not a millionaire yet haha).

AK71 said...

Hi MW,

Good to hear from you. This article is very you, isn't it? Haha.. You are not a millionaire yet and the keyword is "yet". All in good time. ;)

B said...

Hi AK

I like most about the point whereby those wannabees are acting rich when they are not, while the rich do at times act as if they are not. The rest are simply the rich acting like the rich :)

AK71 said...

Hi B,

I actually know someone who stays in a house, drives a Jaguar and has club memberships but he had to borrow money from his relatives who have none of these. He is rich but it seems that he is always broke...

EY said...

Hi AK,

Good article with practical advice. :)

We can probably talk about psychological freedom here as the primary premise for spending less and thus accummulating more. Freeing ourselves from excessive desires for materialistic possessions, from an inflated ego of wanting to impress, from fearing embarrassment of being unfashionable and what not.

It really takes a lot of will and self awareness to walk the path of frugality by choice. Not easy to muster the will to free ourselves psychologically, really. But not impossible. And reading articles like this is like rehab. And I certainly need that. Haha.

Endrene

AK71 said...

Hi Endrene,

Try chanting "Om Amitabha, Om Amitabha, Om Amitabha..."

Versions in Mandarin, Hokkien and Cantonese work just as well, I guess. ;p

Now, I am kicking myself for buying that vintage Rolex. :(

opal said...

Hmm.. Let me throw in something.. Why do we want to be rich? If we have sufficient money to sustain our lifestyle and save enough for rainy days and retirement needs, we should occasionally reward ourselves with something we enjoy.
Getting rich shouldn't be the goal. Being rich do that it gives you a peace of mind to do what you wanted. There are things that you can no longer do when you are old.
Just some thoughts

AK71 said...

Hi opal,

Oh, I so agree with you! Being rich should be a means to help attain happiness for ourselves and the people we care about!

There is no point in being rich and miserable! :)

NewPath said...

Hi AK,

Many thanks for sharing so many good and insightful articles.

It has been a joy reading your blog, I regretted for not finding it earlier. It has become a must do thing for me to read your blog daily.

Your articles set me to pause and reflect...it is really a very refreshing feeling.

Really appreciate your self-less sharing.

Thank you.




AK71 said...

Hi NewPath,

I am glad if my blog has helped to make any positive changes in anyone's life. Often, as I blog, I also pause and reflect on my own life. So, it has been good for me as well. :)

Please don't regret not discovering my blog earlier. All of us have to try not to regret the past but to look forward and think how tomorrow can be better. ;)

SnOOpy168 said...

Read somewhere earlier ladt week that the real rich wears a timex (or casio, in my case), owns a house less than us$400k (which is hugh sized by their standards, except for the NYers & Frisco lites).

My defination of rich : when i am really smiling at each monrh end, with that positive & growing bank balance (not a million dollars own-stay apartment).

AK71 said...

Hi SnOOpy168,

Living well within our means is definitely part of the formula. I have no doubt about it. Good on you. :)

SnOOpy168 said...

Not there yet AK. Only 1 very fraction of that.
the real rich ppl that i met (not the rich daddy's money type) are really humble. No need to brag of their arrival or snob about their latest Limited edition Gucci. / LV & (u name it @ mBS)

Of course, they won't take the MRT with me either.

Some of the summary that you mentioned are long time ago wisdom. Like paying yourself 1st & getting educated. Perhaps the speakers are borrowing our watches to tell us the time ? charging us $$$ for that too

AK71 said...

If you want to be rich, you have to stop acting rich… and start living like a real millionaire.

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