Movies and books that are based on the lives of rich and famous people usually gloss over the small details and dramatize the struggles. But here’s the thing-becoming rich requires hard work. And once you are rich, staying that way is even more hard work. On the surface, it might seem that the rich and wealthy of this world do not have enough things in common.

But, the only mantra that they follow is to do the same things differently. Let’s take a closer look at how some rich and successful people got where they are today, and if there are any common lessons from these journeys. Here are some of the common things in the world’s richest people: 

What do the World’s Richest People Have in Common?

  1. Rich people are frugal spenders

Facebook’s Mark Zuckerberg is known for wearing simple t-shirts to his office. Bill Gates is rarely seen dawning a tailored suit. The number one gateway to becoming rich someday is to check your spending habits and this shows on people with their attires and lifestyles. The rich buy only what they need.

They focus on building their wealth rather than cramping their homes with things. That explains why some of the richest people in the world aren’t living a flamboyant life. The rich do not seek to look rich. They know that they are (or will get there).

  1. They do not save; they invest

Traditional saving is not in the rich’s dictionary. They do not put their extra money in banks or deposits. The rich people are always on a lookout of investing their accumulated sum and get returns higher than conventional banks. =

Experts will always tell you that a large amount of money sitting in the banks lose their value over time, but people who actually listen to this are the ones that make it big. Inflation makes cash useless unless it is generating more returns than its annual rate. The world’s richest people either have their money invested in companies, common stocks, or real estates, all of which inflate more than the macroeconomic inflation rate. They make money with money.

  1. Debt is their friend

Robert Kiyosaki built his empire with real estate. He would draw out loans from banks to fund properties and rent them out to pay the EMIs. Mukesh Ambani, once the richest man in Asia, owes a total of INR 2.87 lakh crore in debt for his company, Reliance Industries Limited. The rich make debts or loans to their friends. They take advantage of the year-long payments to inflate their wealth. At no time do they allow their debt to pile up and make them bankrupt. Simply put, they know how to make the best use of short-term loans and quick personal loans to boost their business. 

  1. They rarely gamble with all their money

Veteran investor and one of the top five richest men in the world, Warren Buffett, advises that the first rule of becoming rich is never to lose your money. He believes in making strong investments that are sure to generate returns, and gambling does not exist in his books. Unresearched investments deflate accumulated amounts and people looking to gamble their way to richness fail almost always. Buying lottery tickets or looking to win with poker works on similar principles where the chances of return are minimal. 

  1. Depend on Systematic Investment Plans

Every investment channel shows large market swings. They go up during economic booms and crash when things go bust. No one can accurately predict when the market will behave in what way. Until they gather enough experience to make predictions, the rich take advantage of systematic investment plans or SIPs. You buy more when the rates are cheap and invest less when prices go up – all by paying a fixed monthly amount. The overall return is positive, and it allows you to build your wealth over time. Take any rich person in the world, and he/she will tell you about the magic of planned investment that they tapped into.

  1. They think long-term

Be it SIPs, stocks, real estate, or private investments, the rich do not put their money in for a short span. They do not deal in months or a few years but think in terms of decades. Elon Musk founded Tesla way back in 2003, but only recently did the company find success in the stock market and help Musk join the ultra-rich club. Creating wealth is a long-term game. Short-term investments eat up returns in brokerage and taxes, and the rich avoid that.

  1. They put passion before money

Talking about Elon Musk, he is probably the biggest example of how passion can make someone wealthy. Designing safe cars were his childhood dream and Tesla is the product he built of that. For years the company has been unprofitable, and then in February 2020 when its share price soared above $700. Robert Kiyosaki also said in an interview that he continues to invest in real estate because he likes real estate. And Jeff Bezos created Amazon from his fondness of books. The rich people continue to chase their passion and they understand that the key to sticking with something is to like it first and then make money out of it.

  1. The rich learn from history

Iconic investor Benjamin Graham preached that history is the best teacher. And the rich follow that as gospel. Not only do the rich learn from their own mistakes, but they look at the world continues to understand what everyone did wrong throughout history and refrain from repeating them in their own investment strategies. In his book “The Intelligent Investor,” Graham writes about the airline bubble of the 1950s when everyone invested in airline companies only to overvalue it. A similar thing happened in the 2000s known as the dotcom bubble. 

  1. They make the most of bad times

The popular rule that is now followed in every investment circle is to buy when the market is down and sell during the boom years. In fact, this is how the rich gather their wealth all over the world. Robert Kiyosaki bought most of his properties on the outskirts of urban hubs, where the prices are comparatively lower. He also timed his purchases when the real estate market was down. Once the price rose during economic progression, he sold to gather wealth and followed the same strategies elsewhere. Buffett also buys undervalued stocks with solid assets. The rich go conservative during good times and cash in when things become difficult around the world.

  1. They know their risk appetite

Every name person who made it big knows exactly how much risk they can digest. None of them stick to just one avenue of investment to guarantee that returns continue to happen if one of their decisions go wrong. Their appetite for risks makes them conservative or aggressive investors, but all of them ensure that they generate money in their respective ways. Buffett believes in investing in companies with a solid moat. Musk argues that innovation and skills drive success. Both their ideologies might clash, but they are both rich. Only the risk that they are comfortable with is different.

  1. They know how to be patient 

Market swings do not bother them. They know that what goes down is sure to come up. This is why Warren Buffett continues to hold a 23% stake in Apple Inc., even when the company has lost value after its peak. The rich allow their patience to dictate their wealth and investments. They allow their decisions to wait out the bad phase and thrive when the sun shines again. Buffett believes that in the stock market, the wealth travels from the active to the patient, and the latter enjoys the true benefits by staying silent. 

  1. They are comfortable with liquidity

No matter how much the rich talk about investments and buying companies and being averse to savings, they always have enough liquidity in hand for any unforeseen period. They never invest all their money and lock it in. Neither do they pour everything into their business? The wealthy people keep enough cash as a cushion to maintain the position that they have worked so hard to reach. Cash can clear out immediate debts. It can also buy companies instantly when they are struggling. Stepping out of investment plans prematurely comes with a loss of money, and the rich do not play in that arena.

It is not difficult to identify the common traits of the world’s wealthiest people. It is important to remember that they did not get where they are in one day. Everyone, in their respective fields, followed a common set of paths, and money followed them automatically after their initial phases of struggle. Thus, intuition, self-control, experience, and shrewdness, these are some of the qualities that have made people accumulate unimaginable levels of wealth today. One’s goal should not be to enter the high net-worth group while working hard but should be achieving success.

Aahna Gandhi

Aahna Gandhi is an enthusiast traveller, writer and a PR Professional. She likes sharing memorable moments from her travels and inspire others to live a life full of wonder. Known for her content, she has worked for travel, technology, lifestyle, health sectors as well as finance.

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