Reading time: 2,520 words, 7 pages, 6 to 9 minutes.

The rich are rich because they’re smart. The corollary is that the poor are poor because they’re stupid (see ‘Notes’ at end.) I admit that’s harsh. But, that’s life. Get used to it. Learn from it so you don’t become stupid and poor.

We get rich by spending less than we earn. We don’t need to earn six figures or more to get rich. We just need to spend less than we earn. This surplus is what makes us rich. The longer we do this, the more wealth we accumulate. It’s that simple. However, that doesn’t mean it’s easy, especially if we’re stupid, or our own worst enemy, or follow the herd, or try to “keep up with the Joneses.” It’s hard if we lack impulse control, or patience, or discipline. And, it’s harder still if we’re unable to delay gratification.

In case you haven’t noticed, I don’t pull my punches and I’m not politically correct. Political correctness is the impossible notion that you can pick up a turd by the clean end. I believe in personal responsibility; that actions have consequences, and “there ain’t no free lunch.” If you need icing sugar blown where the sun doesn’t shine, you’re on the wrong website.

If you think life owes you something that you haven’t earned, then you need to grow up. We’re entitled to nothing. Rich people understand that. Poor people think they deserve what they haven’t earned. That’s what keeps them poor. Governments encourage this entitlement mentality. It keeps poor people enslaved to the government and easier to control. Rich people understand that, too.

Smart Ways to get Rich

I read an article about the multi-millionaire, Ken Thompson buying brand-name lightbulbs at a dollar store. Mr. Thompson knows that time is money, so I doubt he didn’t buy just one package. You can bet he bought a large quantity. The reporter never mentioned how many he bought. That’s why Mr. Thompson is rich, and the reporter isn’t.

That’s how the rich get richer. They buy large quantities or in bulk especially when items are on sale.

Rich people know that lightbulbs don’t have an expiry date so they can stockpile them. You can do the same with other durable essentials that you commonly use such as toilet paper, paper towels, tissue paper, garbage bags, tin foil, etc. when these items go on sale. Stupid people buy them one at a time after they’ve run out. They need them immediately and can’t wait for them to go on sale, so they’re forced to buy them at regular price.

Stupid people believe what the government and their ass media minions tell them about the inflation rate. The inflation rate is not the benign 2% (or less) that’s reported. Look at the WWW.shadowstats.com  graph below, and you’ll see that the real inflation rate (in blue) is over 5%.

Smart people avoid this inflation by buying today what they’ll use in the future thus avoiding 5% inflation. That’s like earning 5% a year. Good luck trying to earn 5% in a savings account nowadays! When I get down to my last half dozen of a stockpiled item, it goes on the shopping list, and I wait until they go on sale. That’s how the rich get richer, and the poor don’t. The rich are smart; they think ahead.

Rich people buy quality; poor people buy junk. A good quality pair of boots might cost five times as much as a cheap pair, but they’ll last ten times longer so they “cost” only half as much per year of ownership, and they’ll still look better and stay drier than the cheap ones. The same principle applies in the long run to buying a good washer & dryer vs. lugging your clothes to the laundromat. That’s why “it’s cheap to be rich, and it’s expensive to be poor.”   [Link]

Once they have access to capital, the rich can make decisions that make them richer, better off and save time.  A good example is the world of heavy machinery. If you’re a contractor where ‘uptime’ is important, it’s often cheaper to pay more for a machine initially if it gives you more production, faster service, better parts availability, less ‘down-time,’ lower fuel cost and higher resale value. On the other hand, it’s said that governments (lowest price tendered) and professional Purchasing Agents know the price of everything and the value of nothing.

Rich people also find ways to make things last longer, so they don’t have to spend money replacing them as often. For instance, you can extend the life of razor blades to months instead of weeks by ‘denim-stropping.’ [Link] I now change blades about every three months. In fact, I once used the same blade for ten months just to see how long I could make it last.

Trash Your TV

Rich people don’t waste their time watching TV. It’s not called the “Boob Tube” or “Idiot Box” for nothing. Rich people use their free time to learn new things. If you refuse to learn new things even though you’re capable of doing so; you’re stupid. The boob-tube is a stealth brain-killer as I demonstrated in “This is Your Brain on TV.” [Link]

I trashed my TV thirty years ago, got a life and found alternate sources of news. It wasn’t long before I began to feel like a stranger in a strange land when I talked to Boob-Tubers because I found I had little in common with them anymore. It took a while to get used to that alienation until I realized I was distancing myself from idiots and that’s a good thing because they had little to teach me. I’d rather have a few good friends that are well-grounded than a large circle of morons vexing my spirit.

Tax the Rich

Many people envy the rich. ‘Envy’ is a four-letter word. It’s also one of the seven deadly sins. It is undoubtedly the most joyless of sins. Buddha said, “He who envies others does not achieve peace.”

Politicians love the rich because they make good targets. Poor people demand that governments “Tax the rich” and pandering politicians promise to do so to get votes. Of course, politicians rarely keep their promises and even if they did, taxing the rich wouldn’t solve the problem of indebted governments. Even if they taxed the rich 100% of their income, it would fund the government for perhaps a day. And the next day, the rich would be poor, and the government would still be over-indebted. Problem NOT solved.

The rich are smart. They avoid paying unnecessary taxes. Just to be clear; tax avoidance is NOT illegal. However, tax evasion IS illegal. Tax avoidance is the legitimate minimizing of taxes, using methods approved by the tax man. On the other hand, tax evasion is the illegal practice of not paying taxes owed.

Stupid people call tax avoidance methods “loopholes.” That’s ignorance and envy speaking. One of the reasons stupid people are poor is they don’t take the time to learn how to take advantage of these methods.

A citizen’s duty is to avoid paying unnecessary taxes. Governments try to control our behavior through tax incentives. The rich organize their affairs to take advantage of these tax incentives. If you call them loopholes, you may be paying unnecessary taxes.

Avoid Addictions

I delivered a box of canned goods to a local food bank. People were lined up inside. It was a smoke-free building, so no one was smoking. However, the stench of cigarette smoke these people emitted made me gag. Their clothes reeked of smoke. They couldn’t afford to buy groceries, but they found a way to buy cigarettes. No wonder they’re poor! They’re stupid.

You needn’t tell me how addicting nicotine is because I already know. I, too, was stupid because I smoked for 24 years before I finally managed to quit. I tried and failed six times before I finally kicked the habit. Apparently, that’s par for the course.

Smoking is stupid. Trying to quit, failing and giving up is also stupid. On the other hand, trying to quit and failing, but refusing to give up is smart. If you’re a smoker, be smart; keep trying to quit. Use failure as a learning experience and build on this investment of agony.

Given everything we know about the dangers of smoking tobacco, I’m amazed people still smoke. I lost my father and a brother-in-law to lung cancer. Both were life-long smokers. My brother still smokes even though he watched both our father and brother-in-law die of cancer. How stupid is that? (Are you listening, bro?)

Debt

The rich are rich because they avoid debt. Getting into debt is easy. It’s tough getting out of debt. It’s called ‘deleveraging,’ and it’s painful. Credit card debt is especially stupid because interest rates are so high that it’s difficult paying off the balance.

Money is the number one worry for most people and the cause of much marital discord. If you can’t afford something, don’t buy it on credit unless you can pay it off immediately. The sour taste of debt remains long after the sweetness of the purchase is forgotten. It’s pointless buying stuff you don’t need with money you don’t have to impress people you don’t like.

Successful Habits 

“20 Daily Habits That Could Make You a Millionaire” [Link] include;

– Getting up early to get things done without distractions.

– Other advice includes surrounding yourself with successful people rather than those who hold you back.

– Set goals and then make plans to achieve them by breaking goals up into smaller, more achievable goals and use a “To-Do” list.

– Find the sweet spot between staying busy working long hours and knowing when to relax to avoid ‘burn-out.’

– Don’t be afraid to say “No” to time-wasting activities and people who demand you share your wealth.

– Diversify your income so you don’t put all your eggs in one basket.

– Be bold and take risks, but have a Plan “B” in case the risk doesn’t pay off.

– Learn from your mistakes. Thomas Edison discovered hundreds of ways not to make a lightbulb before he was successful.

– Zip your lips and listen to gain a better understanding and improved relationships.

– If you have wealth, buy some gold and silver. It’s not an investment; it’s insurance.

– Last, but not least; be humble because nobody likes a braggart.

Not everyone can do all these things, but the more we do, the more successful we become. 

Your Best Investment is Yourself

Good health is an also an investment. We can’t control our genes, but we can control what we swallow. “You are what you eat.” If you eat garbage, you’ll trash your health, so eat healthy to stay healthy. At the lunchroom at work, I notice what people eat. They eat hot dogs, Pizza Pops, frozen ready-made meals and other over-processed garbage, and then they wonder why they’re overweight and have diabetes and failing health.

Read food labels. If you don’t understand the ingredients, don’t eat it. I avoid shopping for food in the middle aisles of the grocery store because that’s where the highly processed junk food is. If it comes in a box, it’s probably junk. I also avoid “white death”. I eliminated sugar, shunned refined white flour and reduced my salt intake. As well, I fast regularly which improves my health in addition to saving money on groceries. [Link]

We can also control what we do. In other words; exercise. 76% of uber-rich people exercise every day. [Link] A little exercise is better than none. The longer you live, the more time you have to make money.

Everything we own can be lost, taxed, expropriated by the government, burnt, stolen, worn-out, outgrown or forgotten. The best investment we can make is in ourselves, our knowledge and skills. The best survival gear we have is between our ears. Nobody can take that away from us.

Life-long learning opens doors and gives us the ability to identify opportunities and the confidence to grab them. It makes us more interesting to others and able to converse with a diverse range of people. We’ll have a considerable stockpile of solutions to tackle challenges. It’ll keep our brains young and help stave-off the ailments of old age. All it takes is a few minutes a day. You don’t have time? Then, stop watching the Boob-Tube and invest in yourself. I once knew a fellow who proudly proclaimed he hadn’t read a book since high school. He’s stupid.

Travel is another source of learning. Whenever I’m away on business, I use it as an opportunity. Instead of returning home on Friday, I’ll book a return flight late Sunday to give me an extra two days to sightsee. I pay for the additional two days’ hotel (usually at a lower corporate rate) and, since my company pays for the flight, I get a cheap sightseeing vacation. I enjoy talking with people. And, most people like to talk so, I ask them for the best places to eat, shop, visit and do things. The locals are often an excellent and current source of information about what to do and what to avoid.

Anyone who stops learning is old, whether age 20 or 80. People who have stopped investing in themselves since leaving school have no one to blame but themselves for their fate. I don’t accept excuses for accidents or bad luck. Most accidents are self-inflicted through inattention or stupidity. We make our own luck.

Yes, that’s harsh. So’s life. Get used to it.

How does one deal with the poor? Simple: don’t be one. The poor will always be with us because there’s no cure for stupid.

Don’t envy the rich. Watch them. Learn from them. Emulate them. Do what they do and you too could be rich.

Gerold

March 7, 2018

Notes: Humans are the only animal in the animal kingdom that fool themselves. A monkey might fool another monkey, but a monkey won’t fool itself.

Never underestimate the power of self-deception. Humans go to great lengths to avoid accepting responsibility for their actions. That’s called rationalization. Many of us make decisions based on feelings and emotions, and only then do we put our brains into gear to justify those decisions. Successful salespeople understand this. We may not be able to control our emotions, but we can control what we do with them.

Yes, shit happens like illness or job loss. But, for the most part, we make our luck, and when it’s bad luck, we turn to self-deception to avoid accepting responsibility. For another perspective see “Wheelchairs & Asking the Right Question.” [Link]  Few of us are willing to admit that most of us get what we deserve, not what we want or wish for.

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