Tuesday, July 15, 2014

The benefits of appropriate timing when building wealth


The primary difference between the wealthy and everyone else is time management.  The wealthy tend to plan their purchases and because they are not so desperate they never fall prey to the penalties of quick money.   It is important to note that there is a difference between the wealthy and the rich.   The rich are still trying to figure things out and are not totally immune to some of disadvantages faced by the middle class.

 For the poor on the other hand their purchases are more demand based.   The poorer a person is the more last minute their purchases tend to be and unfortunately there is always a premium attached their access to money.  Ideally people need to always factor in the cost of borrowing to get a better picture of their spending patterns.  It is not enough to know that you are meeting all you bills each month, take it a step further.  Every penny counts when building wealth.  If you think you have been overcharged take a moment to ask for a breakdown of the costs.  Just because someone is providing a service it does not naturally follow that they have carte blanche.   After all it is a free economy and pricing flexibility is fully in play – willing buyer vs willing seller – there is always room to negotiate.  Some companies now offer you a menu of services that have a corresponding price structure. If you are selecting from a 'menu" then it isn't enough to just buy for price, a discount today might turn out to be a premium tomorrow.

Fundamentally a person’s basic needs will remain the same over their lifetime, its only the quality the changes due to circumstances.  Without an intimate relationship with our finances and goals we will always think that need and availability of funding determine our how, where and how much we spend earnings.  Once you train yourself into having a long-term, well managed view of your future you will realize you have a lot more flexibility in what you can do, reducing expenses and increasing savings accordingly.

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