12 Rules Of Money
135: If you didn't know there are rules when it comes to money...
Welcome reader! Since the popularity of our last article (source), we have decided to write another one with a similar tone. Rules of money. As with everything in life, there is always something more that you may not be aware of. The same goes for money.
What YOU Need To Know About Money
The money is not bad: There is nothing evil about money. The people who got the money are not evil. Neither did all have to commit crimes to obtain the money. These are limiting beliefs that those who grow up in less fortunate circumstances often adopt. It’s a coping mechanism. The fundamental principle of making money is realizing there’s nothing wrong with money. Quite the opposite. It is a vehicle that can help you achieve a better quality of life for yourself and those you care about. Suppose you can't help but believe that money is bad or turns people evil. If that’s the case, reading the rest of this post will be a waste of your time. You have better things to do with your time—working on your relationship with money and your outlook on life. Still not sold? You are looking for a life of mediocrity and wasted talent… Which is not something you want.
The money won’t make you happy: Once you understand the point above. This is the second important concept to grasp. If you have never found yourself in a position where you have money and can afford the things you dreamt about. This won’t make sense. This concept is similar to principles described in lessons learned from spending time with the wealthy (source). The reality is that this idea can't make sense for you if you have not experienced it. Those who have gone through it will confirm the same. Money will not make you happy. It will make you temporarily happy, but that feeling will fade in less than a week. 48 hours is a more realistic prediction. The reality is that money often makes you more miserable because it is an easy way to get addicted. Always wanting more. Throw into the combination of unnecessary spending or getting into debt to buy something simply because you finally can do so… Everyone knows where that combination is heading. Repeating ourselves. The money will not make you happy in the long run. You should self-internalize this or work on your mental models (source). Suppose you don't believe that our statement is true. Go to the best private clinic in your town and ask anyone sick. You will quickly get the confirmation you need. They will tell you exactly what we did.
You are dependent on it: To add a bit of contradiction into the mix. The healthiest relationship one can have with money? It all comes down to 1) understanding that money is not bad, 2) the money will only make you happy temporarily—not in the long run and 3) that your quality of life depends on it. Meaning? You want to earn as much money as possible. This ensures you bring quality to your life and those around you. While understanding that it is not the most important thing in the world. Another perspective? Money is not bad. Money is necessary. Money is not the most important thing in the world. This is a complex concept if you have never had money in the first place… Yet one is required for you to improve your life.
Rules Of Money
1. The More desperate you are for money the less you will have: This applies to everything in life. The more you want something. The less are the chances of you achieving it. Better said, when you are desperate for something. You will not get it. If you don't believe this is true. Next time you hear someone is desperate for money or trying to make some, start observing them and noticing the pattern. There is a good reason why they are all desperate, and this reflects on the money-making aspect. Operating based on desperation—the reason you are not getting what you want. Abundance equals power. Achieving a state of abundance is not easy, but one must actively work on it (the only way to improve). More so if you are planning to run your business. Don't believe this is true? If you are running your online business, we encourage you to spend an entire day with Stripe open in another tab and refresh it every 20 minutes. Hoping the graph arrow will go up and a new sale will be made. We can guarantee that your results will be below average that day. Trust us on this.
2. The more money you give… The more money you get back: This unwritten rule of money does come with a few prerequisites. The main one is that it won’t work if you give money to others expecting them to return the favor or the money. It only works when you genuinely try to help someone and give from a genuine place. What is the unwritten rule of money here? The universe will find a way to reward you. Reward you with a much larger gift than you gave to someone in need. This is one of those things you can’t prove to anyone except to tell them, so they try it for themselves. Our advice? If you don't believe this rule is true—we would argue that at least 20% of readers don't believe it. Try it yourself. Just remember that it has to come from a good place where you are not expecting anything in return. Otherwise? It won’t work.
We make a living by what we get. We make a life by what we give. - Winston Churchill
3. Wish for others to have more than you: If you cannot see others win or be happy about their success. You will never achieve success yourself. The same applies to money. This uncommon perspective aligns with the material on reinventing yourself (source). Unhappy because someone has more than you? Better salary? Is their business making bigger profits than yours? This negative belief is one of the main reasons they still have more than you in the first place. Being optimistic means genuinely happy for others and their victories—it will take you far. The same principles apply to money. Negative associations with money or someone for having more than you. Less chances you will be making more than them anytime soon. The only way to win in the long run is to be happy for those around you who are winning.
4. Limiting beliefs about money: People who grow up in a poor environment or with an unfortunate background are the ones who have the most problems with limiting beliefs about money. Often you will hear them saying things such as:
Rich people are evil.
Rich people are selfish and only care about themselves.
Money makes people unhappy.
It’s not possible to make a lot of money and not commit crimes along the way.
Money is evil.
None of this is true. Money has no connection to whether someone is evil or not. The same goes for selfishness and unhappiness, often used as excuses when commenting negatively about someone doing well. How often have you heard, "He has the money, but he looks unhappy". It is nonsense spread by those who have never had money. It reflects human psychology and serves as a coping mechanism of sorts. If you hold any of these feelings or have negative associations with the money… That is the problem. It will prevent you from achieving big things and taking care of yourself. This is one of those unwritten rules that only those with specific backgrounds struggle with. One of those? Work on eliminating it—there should be no negative association with money.
5. Saving money works but won’t take you far: One of those old-world approaches and tales is still being spread (source). Saving money plays a significant role. More so if you are building your foundation or setting 6 months of expense on a side as you should in case you follow our blueprint (source). That is the bare minimum for everyone. People rarely mention that saving money doesn’t bring much in the long run. Less so when you consider inflation and what has been happening the last couple of years. Money is meant to be moved, invested, given, or used in a way that you will get more back. Days of keeping cash in your bank account and trying to save it to one-day purchase real estate? Long gone. That money rule doesn’t apply anymore. You are looking for a return on it. This leads us to the next point…
We are not rich enough to buy cheap things. - Russian proverb
6. Money requires strategy: Another common problem is why many people struggle with money and find it hard to manage. It’s because they lack a plan from the beginning. Every dollar in your bank account should have a purpose. Buying ads for your newly launched product? That’s strategy. Investing your money to buy more stocks. That is strategy. Paying someone to clean your house? That’s strategy. We are not talking about the Rich Dad, Poor Dad type of advice you could find in any C-grade self-help book (source). Pay yourself first Far from it. The only way to get real value from your money is by using it effectively—developing a strategy and giving your money a mission. To earn more money, make your life easier, save you time… Your choice. This leads us again to the next point…
7. The power of money: One of the most obvious rules of money. Yet one that often doesn’t receive enough attention. Leverage. Money should work to create leverage. What do we mean by leverage? Don’t want to spend 3 hours cleaning your house every weekend? Pay someone to do it for you. Don't want to bother cooking, but also don't want to eat low-quality restaurant food day? Pay someone to do it for you. Have multiple investments and a huge portfolio (source) but do not want to handle all the legislation and tax situations? Pay someone to do it for you. That is the power of the money. Outsourcing the things you don’t want to deal with while buying yourself more time to do what you love.
8. Overspending is the same as not spending at all: Everyone knows that frugality is a terrible trait (source). Nothing is worse than having a good dinner with close friends only for someone in the group to immediately send you a link or ask for $7 back because they covered the bill. The same principles apply to overspending. There are zero reasons you should be wasting time scrolling Amazon or doing anything similar. Overspending falls into the same category as being frugal. It is a trait that should be avoided. How often have you found yourself earning money or receiving a bonus from your employer (source) to find yourself 20 minutes later looking for your next purchase? That tells you a lot about your relationship with money. Buying things to feel good for 10 minutes? It won’t get you far. The rule of the money is to spend it in ways that will improve your life or on items that will have a lasting impact on you.
Representation of influences on your financial behavior (source).
9. Avoiding losers: How does this relate to money? Because humans are social creatures. We tend to make wrong moves when under pressure. Suppose all your friends go into debt for 30 years to fit in with others. Does that mean it’s a wise financial decision? Far from it in most cases. At the same time, it affects your FOMO system and directly impacts your socioeconomic status within your circle. Whether you like it or not. Your social circle directly impacts your money decisions. We have seen numerous cases where high achievers lead mediocre lives simply because they have been poorly influenced over longer periods. The normies (source) can’t be avoided. This doesn’t necessarily mean you should stop hanging out with your friends (maybe). Being forced into a decision due to status or because "it’s normal" can lead to serious consequences that one may regret.
10. The wealthy remain silent while the poor make noise: This concept is hard to understand if you never thought about it. One that won’t make much sense if you are not following the pattern or looking for it. A simple example that most can understand? Why does BOSS (not referring to the real Hugo Boss - their sister company) produce shirts with "BOSS" printed on them 82 times so that everyone can notice it from a block away? On the other side of the spectrum, Loro Piana creates shirts with no visible branding. Not a single logo. Compare Calvin Klein and Brunello Cucinelli as brands. Analyze the differences. The differences? Night and day. We all know who they target with the flashy brands that must prove themselves to others—lower and middle-class consumers. The same pattern applies to anything related to money. Those with money don't need to prove to others that they have it. Going to clubs? What we have just said could be confirmed on any random Friday night. Those who don’t have money → pretend to have money. Those who do have money → don’t care. The rule of money is that if you need to show off or pretend to have it... You don’t have it. This pattern will never go out of style because it is purely based on human nature. It’s a rule that those with money don’t need to show they have it.
11. Debt brings more debt: One of the reasons why we are not so big on debt and how one should approach it as described in risk management (source). You lose the money game once you start treating money so that you always have the leverage to borrow more from the bank. This rule applies because everyone who has tried to cover one debt by taking on another has learned this cycle never ends. This cycle never ends, and it often leads to a lifestyle trap (source) and a mediocre life. Money is neither sacred nor something that should be looked upon. Yet, you must respect it and understand its purpose. Making more money to spend and end up in a bigger debt than you were before? Avoid at all costs.
12. Understand what money can’t buy: To wrap up 12 rules of the money. We are leaving you with a video from the legendary Zig Ziglar. Money can’t buy everything. But it can help ensure you live better than yesterday.
Disclaimer: None of this is to be legal or financial advice of any kind.
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