RICH GROW - How to grow rich?

I've heard many people tell me that it is impossible for them to save money because they do not have any money to save after paying the cost of living. While this may seem true to most (or may even be true for some of us), the point is this: most people can save money. Here are a few examples where it is possible to save on an extremely limited income and possibly...over time grow quite rich.

Step 1: Think for example of a family of two who have a limited income but somehow manage each week to treat themselves to soda, cupcakes and chips each week. If you took the money they spent on the soda and the cakes and the chips and calculated how much it came out to and then calculated that in a fund that paid about 5% over a thirty year period, you would come out with a sum somewhere in the neighborhood of millions of dollars.

Now you say, "that's impossible." But this isn't so. As an ancestor of mine frequently mentioned how "A penny saved was a penny earned." I think what he was talking about was that interest on interest causes money to grow at a much more rapid pace. While I am sure that the daily consumption of a cupcake would cause considerable growth, I don't think it's the kind of growth that can support you in your old age.

Step 2: In order to begin any serious wealth-growth plan we must first change the way we think about spending. We live in a world in which ad agencies are paid considerable sums of money to make the public buy products they do not want or need, by creating a false sense of need. This is done in many ways, some of which are very familiar to us all. For example, I see a handsome young man, in great clothes with a shiny new car and what comes with that, the equally fabulous girlfriend. Therefore, I deduce that if I have that car and those clothes I will get that girl. And they all LOOK happy. So I think, perhaps even just on a subliminal level, that I will be happy if I get that car and those clothes and that girl.

But shortly after buying the car and the clothes, and maybe even dating the girl, I realize that this is indeed not fulfilling my expectations for happiness. Then I'm on to the next thing that will make me happy.

Rule #1: The best things in life, aren't things.
Rule #2: Money can't buy you happiness. But it can lead you there and secure your future.

Step 3: What I am talking about here is probably extremely bad for the economy..if the nation would embrace it overall. But let us face it, that's never going to happen. The closest we've ever seen people shunning the materialistic was back in the 60's and now those tree hugging flower children have become yuppies with two car garages and memberships at the club. Funny how things change, isn't it.

But what we need now to do is to focus on you and changing the way you think about money.

Before you spend another dollar you have to ask yourself if you absolutely need this item to survive. I'm not talking about a new pair of shoes. If you have a good pair of solid leather shoes, then that's all you need. Get something classic, always stay with the classic as it rarely goes out of style...

Get style out of your vocabulary. Stick to classic or develop your own style. If you follow trends you will always always always find yourself pocket poor.

Step 4: Saving begins at the simplest levels. You have to save in little ways. Remember that out of a tiny acorn a large oak tree will grow. Let that be your mantra, because your savings will grow into a mighty oak which will keep you comfortable in those golden years ahead.

You want to change what you eat, how you live, the cleaning products you buy. Where can you save? Think of changing your thinking so that the way you spend becomes the way you save.

Turn the curse of spending into the reverse of spending.

Step 5: They say you should "pay yourself first" which means setting aside some funds -usually a percentage to go into a savings account. But the truth is, in order to amass that fortune you need to spend yourself first, meaning, you will only spend what you need to survive.

For example, I like to have milk in my coffee. Now milk is expensive. But I have determined that I can be just as happy with a generic non-dairy creamer that I can get at a Dollar Store. It only costs a buck and lasts a month. This saves me on the 2.00 or 3.00 I am likely to spend a week on milk. Now you're thinking, "But Richard, it's only a few dollars a week?"

Step 6: Rule #3: Abandon the expression, "It's only a few dollars..." Remember that every penny counts. I know you don't think that it will help you, but I've a friend who amassed in the millions this philosophy. She simply said, "If I only have ten, I don't spend eleven."

If you have a high rent, try to get a cheaper rent, or take on a tenant and charge them for a furnished room, and then rent them the place for the majority of the rent. You will need to cut your costs down to the bare bone.

Don't buy anything that you can't borrow from a friend, like a camera, or a car, or a sweater, etc. Learn to drink water instead of expensive cola (and any cola is expensive on this budget).

Buy meat from the supermarket just as it's about to turn. I used to do this at an A&P that was on 14th Street in Manhattan. Every thursday they would mark down the meat. I would buy a bunch of it and then freeze it. I never got sick from this meat and I paid literally pennies on the dollars for it.

Step 7: There are so many ways to save money. Learn to shop at a dollar store. You can get so many of the cleaning and paper products you buy at the supermarket for much much less.

In terms of clothing, you can go to "seconds shops." We've a bunch in Manhattan down on Warren street where second clothing is subsidized. You can buy a white linen shirt for less than a dollar and jeans as well. The trick is that you really and truly have to examine the merchandise. It is usually sold in bins in a warehouse type environment.

Learn to shop second hand shops. So many of the things which would cost you hundreds of dollars can cost you less than ten.

Step 8: And then, once you have a sizable amount (500.00 or more), open up a savings account with a company like ING and leave it there. Do not look at the bank account. Do not say to yourself, "I have this now." Let it go. Forget about it.

I encourage everyone to get a job with good health insurance. This is the one sure fire way to deplete the savings account.

If you must go out for social events, go to free lectures or music concerts in the park or local hall. You have to change your thinking.

Step 9: I encourage you to stay away from television or magazines. These are the places where the subliminal messages to spend are sent.

Discover your local library. You can rent films from there for free, and if you go to the salvation army you might be able to pick up an old VHS player. I got a new one there for 14.00 and now I can watch the library films for Free!

Start reading. The world is full of wonderful books. You can get these from the library or very cheaply at "bag full of book" sales.

Step 10: Develop hobbies which make money and add that to your account. I started picking up shirts I would find by doing a search on ebay for vintage shirts, and then go to thrift stores and garage sales to try and find them. It was a fun outing for the entire family and I discovered that certain Hawaiian shirts that sell for 99.00 or more, as well as Levis jeans and Izod Lacostes. That will then add to your fortune.

If you do as I direct you, you will have quite a bit of money in the long run. Stop being so generous with your family and friends. Realize that time with you should mean more than time with your pocketbook. And if they don't think so, at least your friends, then they really aren't friends at all.

Do not spend money unnecessarily. Remember that the life you save will be your own. As Tennessee Williams has said in, "Cat on a Hot tin roof," "You can be young and poor, but you can't be old and poor."

Save now. Save yourself, before it's too late, and baby, it's later than you think.
You have the ability to make these changes. Start dressing in black. You can wear quite a bit of it and it rarely goes out of style.