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Rich People
Sunday 19, February 2017

Rich People

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In the song “If I were a rich man” from the musical Fiddler on the roof, Reb Tevye asks plaintively; “Lord who made the lion and the lamb, you decreed I should be what I am, would it upset some vast eternal plan?  If I were a wealthy man!”  This was one of my favourite songs as a child, and I would sing along at the top of my lungs, laughing because it is a funny song, but also totally understanding his plight.  I did a very enlightening exercise last year, and it goes like this: I was asked by Tony Robbins (well not me exactly) but through his YouTube videos, the following question…What are the first things that come to your mind when you think about money?  Did you know that a very large number of people only have negative things coming to mind?  When you were little, you were probably  told that the “love of money is the root of all evil”, this was then shortened to “money is the root of all evil”.  Due to thinking like this, many persons find themselves to be poor stewards of money.  If they get a little extra for whatever reason, they quickly find a way to get rid of it.  They spend it on something extravagant, they give it away, or by whatever means it is quickly disposed of.   Without understanding your deep subconscious attitudes towards money, you may be inadvertently sabotaging your ability to gain wealth.  With that in mind, I have done a little research on rich people, and there are a few things that stand out.

Did you know that rich people are optimists?  Yup, it’s true, when everyone else is pessimistic, rich people shake off negativity and avoid negative people.  It is this positive spirit that leads them to make investments when others are too uncertain or fearful.  They usually gain more than they lose.

Rich people think long term.  They know how quickly time goes and they tend to always make very long term decisions.  I remember asking an Aunt of mine why she would be embarking on further studies when it would take 5 years to complete.  I could never forget her response, she said “ Whether I do the programme or not, the 5 years will pass”.  And indeed that was about 15 years ago and she successfully completed the programme.

Rich people follow their passions.  The oft recited quote from Confucius is : “Chose a job you love and you will never work a day in your life.”  So many times we hear of people mortgaging their house, using their life savings and or borrowing to the hilt to get their dreams started.  Oftentimes we would vehemently oppose such a decision because the statistics to back up the chance of failure are massive!  However, rich people tend to follow their passion.   The important thing to note though is that some rich people actually  have a passion for money itself.   This is so unusual since most people like money only for what it gives them, but rich people just love the idea of holding money for its own sake.  Hence, this is the reason that it is rarely the rich person who has the biggest house, or the most expensive car or clothes or the finery inside.  They prefer to watch their money grow rather than spending on depreciating assets.

OPM.  Rich people don’t mind using other people’s money (OPM).  A lot of us do not like debt, and, truth be told, find it difficult to sleep when too much money is owing to others.  However, it is difficult to get rich without OPM or leverage.  Would you borrow money to invest?   Most people probably wouldn’t.  However, there are brave people who do it and get rewarded.  Of course, you have to be getting a larger return from the investment than the rate of the loan.

“Watch the pennies and the dollars will take care of themselves. “  Benjamin Franklin.  Rich people are not careless with money.  They watch every cent.  My rich clients over the years have been 100% consistent in that area.  They monitor their investments.  They double check all calculations.  They are on top of everything concerning their  portfolio, down to the last cent. 

If you are seeking to build wealth, this article was just to help you to compare your actions with those  of rich people, and determine how far or near you are from them.  Many people don’t want to be rich, just comfortable, of course rich people don’t think like that, and oftentimes they always knew they would be rich even though they came from humble beginnings.  However, do what is comfortable for you.  Happy Investing!

Yanique Leiba-Ebanks, CFA, FRM is the AVP, Trading &  Business Development at Sterling Asset Management. Sterling provides financial advice and instruments in U.S. dollars and other hard currencies to the corporate, individual and institutional investor. Visit our website at www.sterling.com.jm Feedback:  If you wish to have Sterling address your investment questions in upcoming articles, e-mail us at: info@sterlingasset.net.jm

 

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