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Five things rich people do that you don’t

Most of us can honestly say that we have achieved certain financial and professional successes in life, but that other goals have eluded us.

That’s easy enough to live with, in itself. The problem is that the goals we sought to achieve are often achieved, and the rewards we hoped to enjoy are often enjoyed—by others. To dispense with the elephant in the room, a lot of things come down to luck, and very few things are fair. We are all born looking at a slightly different board and all given a slightly different rulebook. These things matter, of course: one thing can be said with overwhelming statistical certainty: advantages confer advantage.

And yet, it is also true that people in the developed world, excepting only those at the very top and those at the very bottom of the economic ladder, are faced with remarkably similar challenges on a day-to-day timeline. Some ride life from strength to strength and success to success, while others descend into perfect misery.

From this observation I resolved to begin anew, discarding the tried and true answers. What specific, habitual behaviors, I wanted to know, really result in financial success? The answers I found are from contemporary research where noted, but in other cases, these truths of the human condition were established and accepted long ago by social psychologists.

Trust yourself

When you go to work, do lives hang in the balance? Does your day to day performance make the fortunes of millions rise or fall? Does the fate of a company, a nation, or the world hang on your success? Would you want it to? Sadly, many of us aren’t particularly comfortable with being responsible for our own fates, let alone the fates of others. But here’s a secret: accepting responsibility for others is the only way to get off the ground. Jobs that affect nothing and no one are neither admired nor highly compensated.

The highly successful are happy to accept work with actual consequences because they know that even though they are imperfect, their net contribution is positive, and in most cases, there is no one else capable of doing the job better. They develop exceptional skills, talents and knowledge, and they rely on these. If you don’t have exceptional skills, talents, or knowledge—get some. Thanks to an education systems that is obsessed with teaching everyone the same things, many people never learn this simple truth: your greatest value comes from what you can do that others can’t.

Though it may seem odd, many of the other entries on the list don’t work, or don’t work nearly as well, if you don’t trust yourself—that’s why this is number one.

Ask for help

When you look at a list of stocks, what you are seeing is really a list of successful people asking you to help them fulfill their dreams. Not one business in ten would get off the ground without money from the private or public sectors. Those who give, investors in this case, get something in return, but that doesn’t refute the point—it is the point. If what you are doing has value, there are plenty of people who will want to help you, because that will have value too. We are often told that we should ask for help when we are falling on hard times, and it’s true, but don’t forget the help that’s available when you are climbing to new heights, or when you are sitting still, for that matter.

The terminally unsuccessful attempt to do everything themselves, suffer, and grow proud as a result, as if their staunch work ethic made them better than other people. In fact, people who allow their rugged individualism to morph into stubbornness often become burdens to their friends and family.

Note: Accepting help is extremely difficult if you don’t trust yourself, because you may feel that you don’t deserve the help, or that you are only wasting other people’s time, since you won’t get anywhere anyway. Once you accept that your abilities are amazing and your destination is greatness, you will realize that by accepting the help of others, you energize and empower them.

Stay in shape

It seems to be necessary to prove this correlation over and over again, with more and more caveats, but looking at recent studies, (ABC NewsLos Angeles Times)  it should be clear that the fit make more money than the flabby. To this, add the additional effects of this study in the New York Times, showing that heavier people pay far higher costs over their lifetimes. I’ve never studied accounting, but it seems to me that if you have lower income and higher expenses, you are making things far, far harder on yourself than they need to be.

If you know you aren’t getting all the breaks you should, this could be the reason. If your finances never really seem to lift off the ground, this could be the reason. Here me now, believe me later*—if you want to be a success, look the part.

*Tip o’ the Hat, NBC, Saturday Night Live, Hans and Franz skits.

Stick to the budget

No matter how lavishly you spend money on yourself, you never obtain a single glimmer of wealth as a result. We’ve all been told not to spend more than we make, yet we are faced with the incessant temptation to do just that. I do, however, have a simple trick that helps me avoid overspending which might work for others as well. Whenever I want to make an unbudgeted purchase, I tell myself that I will allow myself the indulgence, after I have read everything there is to read about the coveted item online.

Research helps curb spending in a number of ways: first, it slows you down. Second, it can make you aware of flaws in the item you wanted to purchase, and that might put you off. Third, when you realize how much you don’t know about a thing you thought you wanted, it is wonderfully mind expanding. You may realize that you will have to do years of research in order to understand why you might (or might not) prefer brand A to brand B, and you might put the notion of buying it aside, just to save the time. Fourth, you may find that for someone in your position, there is actually something better that you can get for less money. Finally, if this tip doesn’t work; if you learn all there is to know about an expensive item, and can’t stop yourself from buying it anyway, you’ll at least know enough about it to enjoy your purchase.

Observe objectively

Two of the most well known phenomena in social psychology are confirmation bias and learned helplessness. These are both errors in perception that come about as a result of the mind’s applying emotional filters to data before first analyzing them objectively. Confirmation bias is a mis-analysis of new information that causes you (…and me) to see the information as supportive of a previously held belief. Learned helplessness is a condition in which you (…and I) allow ourselves to suffer unpleasant stimuli, even though it would be entirely possible to avoid said stimuli. It occurs after we have been repeatedly exposed to unpleasant stimuli which we cannot escape from. The latter condition is frightening, as animal studies have shown that regardless of the intensity of negative stimuli, animals will no longer attempt to escape from those stimuli once they have learned that escape is impossible. It is possible slowly to shock an animal to death in a cage with an open door.

Nearly everyone, when hearing about these perceptual errors for the first time, immediately sees them at work in the thinking of all those with whom he disagrees. If you’ve had that reaction, don’t feel bad, but understand that you have just experienced another classic perceptual error. This isn’t about why others make perceptual errors, but about how we (yes, you and I) might cease to do so. We have to perceive things accurately if any of our decisions are to be rational; if there is a path to the mountain of success, it must begin in the desert of the real.
Remember when trying to root these errors out of your thinking that they are Subconscious. You will not perceive yourself to be erring in these ways, so make allowance after-the-fact for the chance that you have. Here are a couple of tricks I use.

To avoid conformation bias, I treat every newly perceived piece of information that supports my previously held knowledge as inherently untrustworthy. If several such pieces of information accumulate, I will usually go to an objective 3rd party and ask what conclusions he or she might draw from that information. (Granted, I can only do this when I am aware that the process is happening.)

To avoid learned helplessness, I try to put myself in situations in which, even if I fail, and even if I suffer, I will fail and suffer in ways that I never have before, that way at least I will know that I haven’t begun to accept any limitation as inescapable. I can’t be sure my foes won’t shock me to death in the end, metaphorically speaking, but I can make sure they’ll never shock me in any cage I’m free to leave.

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Dennis Kin

Dennis is a business and financial writer, who had spent almost his entire life independently reporting on different business ventures with major impact on the US and global economy. Dennis places a special focus on examining tech stocks, biotech stocks all while investing a great part of his early hours to researching and writing on the companies in the US markets. Dennis has 15+ years of experience in financial markets.

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