Personal Finance Tips from Billionaires
“… the secret to success: find something you love to do so much, you can't wait for the sun to rise to do it all over again."
This is a professional note extracted from an online article.
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Save what inspires you
The sooner you start managing, saving, and investing your money, however limited, the better off you'll be as long as you avoid mistakes like investing everything into one stock. That’s the advice of Carlos Slim Helú.
He is a Mexican businessman who was ranked as the richest person in the world for a few years. Slim started investing early, buying shares in a Mexican bank at age 12, and earning 200 pesos a week as a teen working for his father's company.
"You become what you believe. You are where you are today in your life based on everything you have believed."
By doing something you love you are more motivated to put the time and effort it takes to succeed and may even develop a new business out of it. That’s the advice of Christopher Paul Gardner. Gardner is nowa millionaire, but he was a homeless single father for a time.
Learning how the system works and avoiding the major pitfalls is often enough to succeed. It’s slow but it’s safe and it’s also the advice of billionaire Warren Buffett.
Buffett made his investment fortune on the fundamentals: focusing on companies with strong annual cash flow, and choosing companies that aren't at risk of technical obsolescence. Buffett spent the early part of his career investing in insurance companies.
Constantly pursuing things you don't need puts you on a financial treadmill, not an upward escalator.
Warren Buffett lives in a house he bought in 1957 for $31,500. Carlos Slim has lived in the same house for more than 40 years.
There is nothing to be ashamed of in taking the public transport and walking. It's easy on the bank account, and better for the environment. Protect yourself and your money by not falling prey to meaningless social pressures or vanity.
A few billionaires like John Caudwell, David Cheriton and Chuck Feeney walk, ride bikes or use public transport regularly.
Don't buy a car just for the status it allegedly brings. It’s an object designed to transport you in safety and reasonable comfort, acting otherwise leads to money waste.
Ingvar Kamprad of Ikea drives a 10-year-old Volvo, and Walmart billionaire Jim Walton drives a 15-year-old pickup truck.
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By following the conventional path of "school to loan to university to work" you risk running into serious debt. Being creative is a potential way to lessen or eliminate that.
Maybe finding a different and cheaper way of doing the same thing, doing a yard sale or getting a side job… Put your mind to it and you may find ways to get a financial boost.
When you buy mutual funds, you are charged a purchase fee upfront. This is a one-time payment to the fund management institution. Annually, you will be charged with a percentage of management fees, commonly known as “expense ratio”, which can be expensive.
Beware when advisors at your bank recommend mutual funds to buy. They might be earning a sales commission.
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If you work from a loss, it's much harder to get back to where you started, not to mention ea...
You lose money when the price you pay does not match the value you're getting. For example, when you're paying high interest on credit card debt or spending on stuff you hardly use.
You gain money when you look for opportunities to get more value at a lower price: For example, buying quality merchandise when it is marked down.
Most of your behavior is habitual. You can change your habits and the earlier you start, the better.
Saving is a habit. Learn the habits of saving properly early. Pay attention to your money habits. Strengthen those habits that help your finances, and break the habits that hurt your finances.
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You don't have to sacrifice all of your free time to start a side hustle, use the time you’re comfortable with and make a little bit of progress every day.
Get to working on improving your finances today, not tomorrow. Reading the steps and thinking you’re capable of doing it but postponing it is just an excuse, an unprofitable one.
Talking about your financial goals, and scheduling time once a month to go over your finances together can prevent money from affecting your relationship.
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