Many people know how to make money, but only a few people know how to use it properly. To become rich, you must know how to manage finances properly, including investing money, rather than letting it settle in savings. Investment expert Grant Cardone shares the financial principles he applied from a young age to the success he is today. Here are four rich people’s finance rules that you can apply to get rich:
- Don’t buy luxury items unless you have savings worth 2x the price of the luxury item
He suggested that we need to have principles in spending money. For example, if you buy an expensive item, you should be able to buy or pay twice as much. If you don’t have that much money, it means you can’t afford these luxury items. Such a shopping rule can help you avoid overspending, while also giving you time to consider whether you really need it or not.
- Don’t buy things, you can rent
According to Grant, you don’t have to buy everything yourself. He himself has the principle that he will only buy something if it will be profitable in the future. “I never buy anything I can rent like a house or a car, so I can avoid the higher monthly payments and maintenance costs associated with ownership,” she explains.
- Don’t spend money because of prestige
Not a few of these people become rich because they want to look capable. It can sometimes be a motivation or even bring them down. “Even when I can afford something, I don’t buy it just to impress other people. Instead, I increased my investment and built my wealth personally,” he explained.
- Have passive income
Having passive income is very important, because, to get rich faster you do need to have several sources of income. For daily needs can use passive income. While the salary from the main job can be saved and invested.