If you find value in these articles, please share it with your inner circle and encourage them Register for My Rich Habits Daily Tips/Article. No one succeeds on their own. Thank you!
The poor and the middle class are forced to spend money on certain things. They simply don’t have many choices.
In my extensive habit study, I found that the rich have more freedom of choice—they do not lock in certain spending like the middle class.
Rich people don’t spend money on cheap products
Poor and middle-class families have limited budgets. This forces them to buy cheap products that usually require replacement within a few years due to limited quality.
On the contrary, the rich have the ability to buy the best quality products that last a lifetime. For example, a homemade millionaire in my research refused to buy cheap golf clothes. Although the millionaire hasn’t bought many golf suits in years, any purchases he does make are expensive and of the highest quality. He told me that he had been wearing the same golf suit for twenty years.
Rich people don’t spend money on cheap services
Like cheap products, poor and middle classes often have no choice but to find the lowest price to pay for certain services.
However, the rich refuse to use cheap service providers because they understand that you get what you pay for when it comes to quality services. Bad workmanship won’t last, and may actually have to be fixed or fixed by someone else.
An example of such a refusal to address cheap services can be found in the tax preparation business. The poor and middle class will prepare their own tax returns or find cheap tax preparation services. It was a transactional purchase, with little tax plans involved.
Some of the millionaires in my research also happen to be clients of my CPA company. Many of these millionaires spend thousands of dollars a year working with our company to significantly reduce their annual income tax.
Rich people don’t have to buy life insurance
The primary purpose of life insurance is to replace income lost due to accidental death of the spouse.
If the poor have life insurance, it is usually a nominal term life insurance provided to them through the employer’s group plan.
Middle-class families usually have both life insurance provided by their employer and separate policies, which are usually ten times the annual salary of each household. This ensures that spouse and children can survive financially with the parents who have lost their income to make money.
When you have money, you don’t need life insurance to replace income. The rich have investments that provide a large amount of passive income that they use to maintain their own standards of living. If the rich do have life insurance, it is usually held by an irrevocable Life Insurance Trust (ILIT). ILIT aims to provide liquidity to its estate, which time to liquidate hard assets such as real estate holdings or existing businesses
Rich people don’t have to buy cheap food
Rich people should not develop the habit of buying cheap and cheap food. They have ways to buy expensive, healthy, often organic high-quality foods. If they go out to eat with their wealthy friends, they often go to expensive restaurants and know that the food will be delicious because it is prepared by professional chefs who use only the best ingredients.
Rich people don’t spend money on lottery and gambling
Poverty and middle classes buy lottery tickets or gambling because they want to win big prizes and become rich. So this is a common additional cost for the poor and middle class.
Rich people don’t need to buy lottery tickets or gambling to create their dream life – they already live that kind of life.
One of the rich people in my study gambling, traveling to Atlantic City once a month, and their spouse gambling. He will allow the limit on how much he loses on the Craps Table is $500 per month. He gambles for it and doesn’t hit the jackpot. The $500 per month cap is reasonable if he thought of it, as he has accumulated about $7 million in wealth over the years, which provides him with about $33,000 a year.
Rich people do not pay interest or fees on credit card
Rich people never pay interest on credit card because they do not hold balances on credit cards. And, if they charge late fees, they will waive the credit card company or take their business elsewhere.
Credit card companies always waive the rich.
Rich people don’t buy an extended car warranty
Many in the middle class buy an extended car warranty, which costs an increase in insurance costs for monthly car payments. They do this because they know they will have a hard time covering any expensive repairs they need on the car.
Rich people can afford expensive repairs and avoid such unnecessary insurance costs.
