How to become wealthy
Your editorial of May 25 concerned one of my favourite topics, being wealthy. This is a goal many aspire to but only a small percentage achieve. People cite different reasons, but my view is perhaps uncommon. Many people claim they want to be rich, but they don't figure out what that means. Often they have a vague dream of emulating a extravagant lifestyle they have seen on TV.
In concrete economic terms, what is being rich? In simplest terms, being rich means: having more money than you need. For people who figure that out, many fall into a second trap. The trap of thinking then they must increase their income to satisfy that equation.
The trouble is that for any level of income it's easy to over-spend, and still feel you need more -- you aren't rich because you still don't have more than you need. That will not work. The only way to become financially rich is to work the "more than you need" portion of the equation. That doesn't mean budgeting and cutting back. It means being serious about evaluating what is a need. A simple example would be buying a new washer. Are you a person who does laundry 21 ways? Chances are you aren't, so the basic machine with a few cycles is all you actually need.
There are millions of luxuries available, and there's nothing wrong with getting the ones that you use heavily, but if you are convinced that "you deserve the best" -- in everything -- then you need to realize that what you really have been convinced of is, "Never consider what you actually need”, and “always spend the maximum”. But if you do think, "Always spend the maximum," then you will never be rich.
I can't emphasize enough that nobody got rich by trying to spend the maximum amount of their money on every purchase.