Importance of being Financially Educated. How To Be Wealthy And Why 95% Never Will Be

"You will never be wealthy working for someone else at a job - EVER!"

Once you have knowledge, you can seized opportunities when they come along, because you can recognize them.

Become an Entrepreneur. As an entrepreneur, you gain time freedom and financial freedom.

The broker buy stuff
The middle class buy liabilities
The rich buy assets that create passive cash flows which can then be reinvested to increase these passive cash flows further.  This is the wealth creation formula.
You cannot find these passive cash generating opportunities unless you are open to hearing about them.  Once you find them, you have to see which fits you and then act.







Published on 27 Aug 2013
How to become wealthy without a college degree
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Dec 3, 2012 - Many people think you must have a college degree to get rich, that is not necessarily true. Here is how you can get wealthy without a college ...
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Six Figures, No College Degree
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To identify the ten best jobs you can get without a college degree, we focused on two critical factors: salary and job growth.
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Charlie Munger Reveals Secrets to Getting Rich

@ 6 min

How Rich Men Think and Act

Wealth Creation Formula:
The broke buy stuff.
The middle class buy liabilities.
The rich buy assets.

How the rich get richer and you can, too

By Mitch Tuchman

We all know, innately, how the rich get richer. Money begets money. But how does that actually happen, aside from compounding interest and purely financial factors?

You could take the cynic's view that the game is rigged. But the more accurate answer, backed by research, is that the rich get richer because of great parenting. How rich you become over your lifetime is directly related to how early you capture the basic truths of finance and investing.

You have seen the exception that proves the rule, the rich kid who blows his family's wealth in a generation through poor decisions. Chalk that up to absentee parents. Truly, teaching is the missing link.

According to a report in Time magazine :

In a paper unveiled a few months ago, researchers led by Annamaria Lusardi, professor of economics at George Washington University, found that an early understanding of financial concepts accounts for as much as half of the wealth gap between the affluent and those with low incomes . Lusardi also found an exponential effect: Those who acquire financial understanding early tend to accumulate assets faster and those with more assets tend to keep learning about personal finance because they have more at stake. (Emphasis added)

There are two powerful forces at work here, in terms of how the rich get richer. Let's tease them out so that you can benefit from the knowledge.

First and foremost, how the rich get richer has a lot to do with picking the right parents. Kidding aside, being born into a developed-country household, availing yourself of a quality education at a low relative cost, enjoying the benefits of a healthy diet and a safe childhood, all of these things give a person automatic advantages.

Yet there are people born into good circumstances who nevertheless seem to just "get by." They see the rich get richer and, quite rightly, question their own choices.

Instead, they should question, or at least examine, their parents' choices. Kids don't listen to what their parents say. They do what their parents do. A parent who saves diligently and consumes moderately is setting a very good, lifelong example for his or her children. A parent who constantly overspends and lives in debt does not.

How the rich get richer: They start early

But the kicker here is learning by doing: Teaching by example is great, but a child learns the power of saving and investing not only by seeing it done by others but by doing it themselves. Practice is how the rich get richer.

Once a young person gets a little bit of capital set aside, they begin to think more conservatively about money: How can I protect and grow that wealth? What are the risks to my plan?

How the rich get richer is by passing on simple lessons about compound interest, about risk and reward, and about the role of money in a healthy, happy life. Rich parents don't fear money; they consider it a useful tool. Those attitudes pass on, compounding in value with each succeeding generation.

Working hard at getting an education is a great base. The simple act of periodic, automatic saving is another excellent lesson. Prudent, effective investing is yet another.

Great fortunes are often built not on chance events but on steady, risk-controlled investment plans that take into account the best practices of generations . 

http://www.marketwatch.com/story/how-the-rich-get-richer-and-you-can-too-2012-10-03

5 Reasons Why Most Don't Become Wealthy

5 Reasons Why Most Don't Become Wealthy

1.  Never occurs to them that it is possible to become wealthy
2.  Never decides to become wealthy
3.  Procrastination
4.  Inability to Delay Gratification
5.  Lack of Time Perspective


Are you unknowingly holding yourself back from financial independence?

The Science Of Getting Rich (Circa 1910)

The Science of Getting Rich

http://www.youtube.com/user/thesecrethome

 

Salaried rich versus the Super rich. Those making $1 million or more are the "salaried rich," since they make more of their money from ordinary income.

The Rich, Very Rich, and, Now, the 'Volatile' Rich

By Robert Frank | CNBC – Fri, Jul 13, 2012

The rich tend to be lumped together as one economic group, as if people earning $250,000 a year (or even $1 million a year) are pretty much the same as those making $50 million.

But a new analysis of top incomes tells us that there is a big difference between the super-rich and the merely rich in how they earn money.

The paper, from Roberton Williams of the Tax Policy Center, compares two sets of 2009 IRS data. One group is American tax filers reporting income of $1 million or more. The other is for the 400 top earners in America, who made an average of $271 million each.

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Americans with an adjusted gross income of $1 million or more make about a third of that from salaries and wages. Capital gains used to account for more than a third of their income, but since 2000 that share has fallen to 17 percent. Today, the largest share of their take comes from "other income" - mainly earnings from partnerships or S-corps, as well as other capital gains.

The "fortunate 400" - or top 400 earners - make much more of their income from capital gains and other income than from salaries and wages, which account for only 9 percent of their income. Capital gains as a share of their income has also fallen, from 72 percent in 2000 to 46 percent in 2009.

What does this tell us? That those making $1 million or more are the "salaried rich," since they make more of their money from ordinary income. The super-rich make more of their money from one-time capital gains from the sale of stock or a business.

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Since the super-rich are so dependent on capital gains, their incomes have become much more volatile, falling 40 percent between 2007 and 2009. As a group, they also change members rapidly, with 73 percent of them showing up on the list only once between 1992 and 2009.

Income for this super-rich group "has become much more volatile during the Great Recession, "Williams writes. In contrast, income for the merely rich dropped 18 percent.

The higher they fly, the harder they fall.

-By CNBC's Robert Frank

Number of wealthy Malaysians to double by 2015

Number of wealthy Malaysians to double by 2015
Written by Joanne Nayagam
Thursday, 15 September 2011 11:45


KUALA LUMPUR: In its first Asia Wealth Report released this year, private banking group Bank Julius Baer expects the number of high net worth individuals (HNWIs) in Malaysia to grow from 32,000 currently to 68,000 in 2015. Their net worth is expected to increase from US$140 billion (RM433 billion) to US$330 billion.

“We see that Asia is growing in a very dynamic way, accounting for almost 40% of global GDP alone if you basically look at China and India as of today,” said Dr Thomas Meier, Julius Baer CEO for Asia, in an interview with The Edge Financial Daily.

Because wealth is generated in growing economies, said Meier, it is natural for the group to understand how this wealth is translated to different individuals.

The report, prepared in cooperation with CLSA, was based on client surveys and interviews covering topics such as environment, philanthropy, investing, lifestyle and education and shows how Asia’s HNWIs view the world.

The key findings of the report include Julius Baer’s forecast that China and India alone will contribute over 40% of the global GDP growth for 2011 and 2012.

It also estimated a doubling of the number HNWIs across Asia from 1.16 million to 2.82 million as their wealth triples from US$5.06 trillion to US$15.81 trillion by 2015.

China alone is forecast to have 1.4 million HNWIs with a stock of wealth of US$8.76 trillion by 2015.


Growth in Malaysia will be broad-based and job creating.

Indonesia stood out with the highest growth rate in terms of number of HNWIs over the five-year period, rising from 33,000 to 99,000 with a stock of wealth of US$487 billion.

Four key factors will drive the rise in HNWIs in Malaysia.

The first is the country’s strong and stable long-term fundamental GDP growth derived from trade and agriculture, and increasingly the finance and banking sector, said David Lim, Julius Baer CEO for Singapore.

“The wealth report agrees that growth in Malaysia will be broad-based. It will be job creating. There will a lot more engagement of Malaysia with Asean and a reduction in the reliance of Malaysia on the Western markets,” he said.

The second factor is Asia’s strong currencies, which Julius Baer believes will continue to strengthen.

Asian currencies will not only benefit from their countries’ strong reserves but also rising inflow of foreign direct investments.

Furthermore, a stronger currency will also provide more “fire power” for asset acquisition abroad. “There will be that money flow back to Malaysia,” said Lim.

The other two factors are asset price appreciation from real estate and equities.

Equally important for HNWIs is understanding what needs to be done to sustain their lifestyle from a consumption and investment perspective.

One of the key components to determine a financial plan is the cost of goods and because HNWIs do not draw from the same basket of 20 items as many others, the report will help them plan for the long haul. For this, the Swiss private bank launched the Julius Baer Lifestyle Index, which captures the consumption costs in Asia Pacific and the inherent inflation.

The 20 items in the basket used for the index include high-value items from wedding expenses to wine and cars to legal costs, cigars and education.

“It is the cost of living the life of the rich,” said Meier.

The index covers price changes from April 2010 to April 2011, and is an aggregate of price changes sampled from Shanghai, Mumbai, Singapore and Hong Kong.

For the one-year to April 2011, the index was up 11.7% outpacing conventional consumer price index measures, which stood at 5.1% over the same period.

The rising number of HNWIs will also benefit luxury brands expanding in Asia. “Luxury goods and established brands will benefit from this wealth,” said Meier.

The key is brand reputation and management to get a brand into an iconic position said Lim.

Julius Baer was a sponsor in the Forbes CEO Global Conference which was held here over the past few days. The bank is present in Asia with offices in Singapore, Hong Kong and Indonesia.


This article appeared in The Edge Financial Daily, September 15, 2011.

Why The Rich Get Richer And How You Can Do So Too

Why The Rich Get Richer And How You Can Do So Too
By: Joel Teo



The Italian once said “There are only three ways to make money – you can steal it, marry it, or inherit it." Many would argue that they missed one very important method – investment. In fact it is why the rich get richer and how you can do so too.

Just ask the young man who invested his last nickel during the Great Depression. He invested in an apple doubled his money the same day and repeated the process slowly building a small fortune. Of course the two million dollars his parents left him certainly allowed him to invest even more seriously. It's why the rich get richer and how you can do so too.

What about Bill Gates who took great personal risks that gave him an industry monopoly. Of course the fact that his grandparents left him a million dollar trust fund and that his mother personally knew the CEO at IBM who would eventually seal the deal doesn't really make for a fair playing field. So is why the rich get richer and how you can do so too really doable?

Let's have a look at Donald Trump who inherited millions of dollars from his father so no matter what success he's had over the years he would have been wealthy anyway. It's why the rich get richer and how you can do so too – that is if you can pick your parents.

Since most of us can't pick our parents we'd better have a look at investing is some common stocks. If you are investing long term stocks are a good start. And it is why the rich get richer and how you can do so too. It doesn't favor rich or poor as long as you have the money for the stocks.

Mutual funds are also a good choice for long term with a lot less risk. Use a funds manager and you're going to deal with a funds load which is a percentage they take each year. But why not be your own manager and eliminate that cost which can add up. That's why the rich get richer and how you can do so too.

If you haven't figured out why the rich get richer and how you can do so too you need to do just a little more research and reading. You'll figure it out in no time and you will have the formula for why the rich get richer and how you can do so too.


http://www.streetdirectory.com/travel_guide/12761/how_to_grow_wealth/why_the_rich_get_richer_and_how_you_can_do_so_too.html