Is Your Money Mindset Keeping You From Being Rich?

How to Change Your Money Mindset

This year, Asia surpassed Europe in private wealth and is expected to beat North America in 2016. Excluding Japan, Asians are now worth $47 trillion.

If your ambition is to become one of Asia’s millionaires, you are surrounded by many models to emulate.  Naturally, you want to know more about the habits of wealthy Asians. Becoming rich is about more than habits, it is a way of thinking and living. Do you make statements such as:

I never have enough money to pay my bills.

I will never get out of debt.

I am stuck in a dead end job.

My house payments leave me with no extra money.  

If, yes, then you do not think like a successful person. To help you meet your goal to be one of Asia’s rich, we have gathered some of the best habits and attitudes of Singapore’s millionaires.

Pay Off Debt – Changing your mindset about being rich starts with changing your idea of who the rich are. Many people who consume luxury goods are not rich but in debt. The first step to adopting a wealthy mindset is paying off your debt. If you have debt your money is being eaten by interest rates, instead of appreciating in value. Consolidate debt and negotiate a lower interest rate. Get rid of high-interest credit cards.

Be Frugal – The media loves to share stories of the counter-stereotype of the rich. Many, for example, are very frugal. They drive the same car until it stops working and lives in modest homes. How much one spends on shoes and watches may seem trivial, but it all adds up. Hong Kong’s Li Ka-Shing is famous for his $50 watches.

Buy Value – A frugal mindset is more than a lifestyle choice; it is the basis of the investment success of many rich people. Value investor Camden Chang has become rich by following in the footsteps of America’s Warren Buffet. He buys assets that are priced cheaply compared to their intrinsic value. He then earns a high return on those assets as the market recognises their intrinsic worth and their value increases. He does not invest in companies with high debt.

Know Thy Self – Rich people choose the right career, according to the experts in the mindset and habits of the rich, Thomas Stanley and William Danko, authors of the Millionaire Next Door. In Millionaire Women Next Door, Stanley profiles a millionaire named Marion who is passionate about and specializes in the dirt. Selling ‘high-end dirt” to golf courses, landscapers and others have made her rich.

Opportunists, on the other hand, often fail in business ventures. As an example, gaming conferences have failed in Singapore, according to TechInAsia, because they have been produced by event companies instead of gaming experts. The Gamestart Asia conference has kickstarted the gaming culture in Singapore because its founders are gaming insiders. Elicia Lee, the founder, is an avid gamer herself who has worked for EA Games.

Dress for Success – Stroll through your local market on a Saturday morning and see if you can spot the rich based on how they are dressed.  The man in the faded jeans and t-shirt is more likely to be the super-rich. He does not want the extra attention, nor does he want to get mugged. The woman in the gap jeans and Ralph Lauren jacket is middle class and still paying for the jacket on her credit card. The confident woman wearing Chanel is rich, wants everyone to know and expects to be given the best service.

So how should you dress for success? Wear whatever makes you feel confident and comfortable.  Do not go into debt to dress for success. You can find everything you need at thrift shops. Do try a new style. Who would you like to look like – the confident upwardly mobile career girl? the socialite in Gucci? Or maybe you have always wanted to belong to the British horsey set and live in a grand country estate. In that case, flip through Tatler for your style guide. It may seem as if you are playing dress up, but how you choose to portray yourself reflects who you really are.

Work Hard – Peter Lim, the son of a fishmonger, worked very hard to achieve his wealth. The billionaire put himself through school by working many jobs, including a taxi driver and cook. Ninety percent of his fortune is hard work, he says.

Unfortunately, the second generation’s odds of retaining their father’s wealth are low. Statistics show that 70 percent of the second generation of wealthy individuals lose the family wealth. This dismal track record is perhaps the strongest proof that not even great riches, but habits and mindset lead to success.