Rats to Riches

Extract from “From Rats to Riches”:

“A rich man, on the other hand, is someone who makes rich financial decisions, someone who spends less than he or she makes and someone who invests the balance instead of spending it on nonessentials. For example, I once asked a friend a simple question: “Say, if you won one million dollars in the lottery, what would you do with it?” My friend responded, “I will buy a sports car, go back to school and graduate from college, then buy a house for my mom, the best gadgets I can afford, the best clothes, and I’ll have every girl I would have my eyes on. I’ll buy a mansion somewhere in California and spend months on the beach, celebrating my new fortune, then I’ll invest or save some of it. Oh—and I’ll definitely quit my job.”
Sounds promising, right? The fact is, most people think in a similar fashion. This is the perfect example of a poor person with one million dollars in his pocket. If you do the math, you will soon realize this guy will spend his million before he graduates from the new college he enrolled in and will end up being in tremendous debt because of a simple lack of financial intelligence.
Ask a ‘temporarily broke’ rich person the same question, and he or she will answer: “I will invest the money in an asset and let that asset pay for a sports car, a vacation on the beach and a house for my mom.” Simple, in this case, is better.
You see, poor people buy ‘stuff’; rich people buy and invest in assets (real estate, businesses, stocks, royalty products, etc.) and these assets buy ‘stuff’ for them.”