It can often seem like no matter what you do with your money, you can never get to that next level. You see the top earners like Bill Gates or Warren Buffett earning boatloads from their successful companies, but how could you ever hope to match them? Well the truth is while it may be difficult to build a multi-billion dollar company, it isn’t difficult to learn from their example when it comes to managing your money.
The Motley Fool recently published an article about how some of the wealthiest people in the world (including Bill Gates and Warren Buffett) manage their personal finances. In it are some useful tips that may catch you by surprise:
Buffett has summarized his views on success and happiness like this: Success is really doing what you love and doing it well. It’s as simple as that. Really getting to do what you love to do everyday — that’s really the ultimate luxury … your standard of living is not equal to your cost of living.
Many people have the materialist’s mentality when it comes to their finances, but Buffett clearly thinks that many of us use the wrong measuring stick. The article also shows that IKEA’s founder, Ingvar Kamprad, has a similar mentality. The moral of the story is that sometimes saving your money rather than trying to live a more expensive life can make a huge difference.
A solid investment strategy is also important:
John Bogle, the founder of The Vanguard Group and the creator of index mutual funds, says many things will try to distract you from your long-term goals, but you have to stay the course: “Do not let false hope, fear and greed crowd out good investment judgement. If you focus on the long term and stick with your plan, success should be yours.”
Always stay informed about the markets and taking time to plan your investments can mean the difference between making and losing money.
Another handy tip comes from CNBC’s interview with Tilman Fertitta, the restaurant magnate. He says that one of the best lessons he has learned is:
Borrow money when you don’t need it, because when you need it, you can’t get it.
This is a very different way of thinking from many people who think that they need to borrow their way out of bad situations. If you can deal with the interest when you have the money available to you, it make paying for it more manageable and give you access to the capital in harder times.
For The Motley Fool’s article on billionaire money managing tips, click here.
For CNBC’s interview with Tilman Fertitta, click here.
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