Wealth Is Not An Appearance

Society teaches us everything we need to know about wealthy people.

Wealthy people live in expensive homes, drive expensive cars, wear expensive watches and take expensive vacations (at their leisure).  They eat and drink like kings and queens, and dress like George Clooney and Heidi Klum. They do this because their wealth enables them to do it.  What else is one to do with all that money?

The problem is, many people who live richly and actually have the means to do so are what we classify as “inheritors” of wealth, and did nothing on their own to obtain their wealth.  I’m talking people with rich parents or rich uncles. Lottery winners fit into this group, too.

In addition to these, there are some wealthy people who do in fact work very hard early on in their lives, but come into massive wealth so fast (lacking any financial know-how) that they immediately feel an obligation to start spending and keep up with the Joneses. Think pro athletes and entertainment stars.

And if you haven’t noticed, the media glorifies this type of lifestyle. Just watch a Matthew McConaughey Lincoln commercial for a fresh reminder.

Unfortunately though for us “regular Joes” of the middle class, wealth doesn’t just fall into our laps.  To add to that, we often don’t have the patience or discipline it takes to build that type of wealth.

But thanks to all those charismatic Lincoln commercials (I really hate them), we still greatly desire the lifestyle that wealth affords. So instead of saving to become wealthy, we put the cart before the horse and spend all of our money just to “live richly.” And it doesn’t hurt that all this spending makes our friends think we are rich too, just like our buddy Matthew (ok I’ll stop).

Sadly, spending richly tends to lead to quite the opposite.

You see, if you don’t already have millions of dollars (myself included), you can’t have your cake and eat it too. If you want to live richly by buying expensive homes and indulging in an expensive lifestyle – you can do so but at the sacrifice of ever becoming wealthy.

Even more unfortunate for us in the middle class is that despite all this spending, life will very soon grow stale and all these luxuries we have will start to lose their luster. And instead of realizing that true happiness can’t be “bought”, most of the time we just end up envying those that have more than we do. As a result, we work tirelessly to find a way to make more money so that we can feel better about our status again.

Cycle repeat. 

Now you’re thinking, “but if I could just become rich, then I CAN have my cake and eat it too, right?”

Technically yes.  But be careful. Even rich people find ways to run out of money.  Just ask M.C. Hammer or Jose Canseco.

The more appropriate question is, if you aren’t fortunate enough to inherit your wealth, and you don’t have unbelievable athletic talent or a knack for entertainment, then how do you become wealthy?

It’s simple: Live well within your means. Save. Invest. (Repeat).

And over time you can amass enough wealth to afford the lifestyle you want, without dwindling down your riches. There’s nothing sexy about how you come into this wealth, it’s just old-fashioned hard work, diligence, and planning.

Don’t believe that it’s possible?

The Millionaire Next Door (which I highly recommend) written by Thomas Stanley and William Danko uncovers the secrets to how self-made millionaires in America amassed their fortunes. 

What did their findings show?

The number one defining factor for these self-made millionaires is that they lived well below their means. According to Stanley and Danko’s surveys, the typical American millionaire reported that he or she never spent more than $399 for a suit of clothing, $140 for a pair of shoes, or $235 for a watch. And most of them have never spent more than $30,000 on a car and are typically driving something other than this year’s model. Lastly, the majority of self-made millionaires don’t live in high-status neighborhoods – they truly live next door.

Doesn’t sound like the typical millionaire we’ve all come to know and love on TV, right?

By living well below their means, these self-made millionaires afforded themselves the opportunity to put their money to work. And according to the book, on average, these self-made millionaires saved and invested nearly 20 percent of their household realized income each year. That compares to the 10 to 15 percent recommendation of most financial advisors.

It takes a bit of sacrifice up front, but the payoff in the end is well worth it:

Financial Independence.  Peace of mind. A lifestyle you can enjoy. Being in a position to help others.


So now the choice is yours.

Do you want to live like a millionaire or actually be one?