10 Simple Money Rules Used by the Rich

Ever curious about what it takes to be rich? I don’t mean the old money aesthetic trend that’s been going around where people play pretend. I mean, what’s it like to live as the rich where you want for nothing. 

How does one even get there? 

At first, I thought of lottery winners. Those lucky few who got rich easy and quick. If anyone can buy a lottery ticket, then it means millionaires can come from anywhere and anyone. 

So why do lottery winners are most likely to be bankrupt? At least a third of them will declare bankruptcy. The rest of them will end up becoming a target for theft, harm, and mental unwellness. 

But then I found about the those who inherited a large financial wealth. They lose all of it within their lifetime! 

How interesting! Despite having an instant increase in wealth –  it only delayed bankruptcy.

And yet, there are people who remain rich. What makes them special and different? What separates these people from the wealthy – the ones who are able to keep and grow their money?

How does one Think like the Rich?

As it turns out, making money and keeping money are completely different skill sets. The wealthy treat and think about money very differently. 

Best of all, these rules are universal. Anyone can adopt them regardless of income level.

Here are some of the rules the wealthy use that you ought to start implementing:

rule #1 – Luck is not a strategy

If you won the lottery – chances are it will never happen again. 

If you have never won the lottery – chances are it will never happen. 

And the rich do not bet on poor odds of winning. 

In fact, the odds of winning the lottery are 1 in 292 million. Which means you have better luck dying from a bee sting! You can buy all the new-age crystals, all the lottery tickets and pray. But the odds are not in your favour. 

Buying a lottery ticket is buying into a false sense of progress. It may feel like you’re getting closer to your financial goals, but you’re buying false “hope.” 

The rich bet on themselves and make things happen. 

rule #2 – Time is the most priceless Asset

I remember hearing a story about a millionaire who refused to get rid of his expensive beloved boat. His accountant reminded him how much it costs every year to keep the boat. The millionaire, age 65, said he only has about 17 more summers with it. 

He wasn’t counting the cost. He was counting time. 

Having 17 more summers sounds more striking than the cost of a boat (average $80k), doesn’t it? It brought me perspective. 

Think of how long it takes you to earn your paycheck. Yet it takes us a fraction of that time to be able to spend it. For example, if you make $20/ hour and you pay $1,000 in rent, it means it will cost you 50 hours of your life per month to live. 

How many hours did that Gucci bag cost you?

Time only seems to move faster as we age, and sometimes we realize this too late. The rich learn this and don’t work for money; they have their money work for them. 

The rich count the cost of time.

rule #3 – Expenses grow over time; plan in decades.

Eventually, you will find yourself being responsible for yourself. No more help from the family or state. You’ll live on your own, need that car to get to work, pay insurance, travel on your own…etc. 

Then as you get older, you may find yourself financially responsible for others. 

If you’re lucky, it will be your family. Your parents will age and they will need care. The rich know there will be upcoming bills and upcoming demands of them. 

The world expands and the wealthy plan in decades. 

rule #4 – Lifestyle inflation is a trap. Stack assets.

The rich live below their means. And stack assets. 

Keeping up with the Joneses is not an aim you should ever have for yourself.

When income increases, the common thing is to have the expenses increase too. People get excited so they forget about putting money away. 

Worse, is when they get too excited. That’s when they have more expenses than income. So it doesn’t matter how much you make in the end, but how much you get to keep. 

Related Read:
Rich Dad Poor Dad
11 Steps to Break Free from Paycheck-to-Paycheck 

The rich know this and stack assets that generate more wealth. Things like stocks, real estate, and business, can appreciate over time. Their income goes up, and so does their net worth.

Rule #5 – Your job is not your only income. And never should be.

“The Rich earn money through leverage, and not hard labor.”

– Steve Seibold 

The average millionaire has at least 7 streams of income. And this is a liberating statistic. It means there are several ways to make money outside of the single traditional 9-5 path.

And with the internet – it’s now easier than ever. 

Imagine your income streams are like legs of a table. If one leg goes away, what’s going to put a roof over your head?

The average millionaire started specializing in one stream before diversifying into other ones. 

Rule #6 – Money in the Bank is money at rest.

The masses save and spend. The rich invest and focus on earnings. 

Your high-interest savings account cannot compete with the average return of the market. A bank has a lot products to aid in your finances – mortgages, loans, GICs. etc. But these products are often safe-bet and low-risk products. They help you (and your bank) keep money. 

The current inflation rate in Canada as of 2024 is 3%. The highest interest savings account averages 4% – 6% in interest rate. The average return in the stock market is about 7% per year. 

Ergo, your bank account is safe but can’t beat inflation. 

The rich do not leave money in stagnation and let it be idle. The rich put their money to work via other investment vehicles. Things like the stock market, real estate, businesses, and other assets. 

Rule #7 – Wealth loves stealth.

Being invisible is a legitimate strategy in freedom and security.

The flashier you are, the more attention you attract. Nobody wants a target on their head for robbery or their privacy invaded. The constant requests from family for loans, donations, or investment opportunities get tiresome.

It can also be a way of humility.

The wealthy put peace as a priority which means a level of social harmony to avoid resentment and envy. 

Being stealthy about their wealth is often a byproduct of their financial strategy. The rich would invest so much of their money back into their assets, they do not bother flaunting. They’d rather ensure their long-term financial stability and growth than a few bags. 

It’s a bit of a contrast from those who value consumption and materialistic expression more. 

The rich tell about their wealth to no one. 

Rule #8 – Having Good Financial IQ is non-Negotiable.

Knowing how money works is not optional. It’s non-negotiable. 

If you have low financial IQ, it’s like a well-equipped toolkit. Except not knowing how to build a house – or not even knowing how to use the tools. How are you able to build a house for yourself if you can don’t know how to use the tools? 

A flimsy house will suffer structural weaknesses. So will you if your financial plan is flimsy and fragile.

Is it a surprise when a lot of marriages fail because of money? You’re leaving you and your family exposed. 

As the saying goes, “The Rich build Empires”. 

And sometimes simplicity helps. The foundation always starts with the first brick. In this case, a budget! Check out mine if you need help getting started:

Rule #9 – Money attracts more money.

When you’re wealthy, a lot more opportunities are open to you.

With efficient capital, banks are more willing to loan you more money. You have more power to invest in greater assets. You’re less exposed to risk and can leverage more money. 

But the most interesting is the “economic connectedness”. 

The rich also have more diverse social circles. People mingle and make friends over shared interests. The rich makes friends with the rich.

What does hanging around the “right” people benefit you?

The wealthy individuals offer advice and mentorship to people. They’ll more likely to give guidance if you already mastered rule #8. Learning from Warren Buffet and Robert Kiyosaki directly can be invaluable and inspiring. Their advice would have more weight than your local financial advisor. 

Rule #10 – Money is only the means, not the end.

Most people over-focus on money and want to spend a million dollars.

They think it’s never enough. There’s too much stress over it (because they lack Rule #8), and it doesn’t align with their values. Working and hoarding money will lead a person to the opposite of what money shouldn’t do – feeling trapped. 

For the rich, money is the means and not the end. They use it as a tool to support their broader life goals and values. 

They know if you over-focus on money (rather than the values behind it), you’ll forever be broke. 

final thoughts

Notice how the rules of rich aren’t focused on hustle itself? It’s almost as if money is a byproduct of your value and work ethic.

People – rich or middle-class – use their case to help them reach their bigger dreams. And live by what’s important to them.

Basically, while having enough money to be comfy and safe is key, it’s not the whole story. Money is a tool to get you to what really matters. When you line up your money moves with what you’re passionate about.

You get to enjoy life without falling into the endless loop of wanting more money just for the sake of it. What exactly do you want your money to do for you? Will it last?

Related Read:
Rich Dad Poor Dad
11 Steps to Break Free from Paycheck-to-Paycheck 

Key Takeaways TL;DR

1. Luck is not a strategy. The rich bet on themselves and blame no one. 
2. Time is the most priceless asset you have. Understanding this sooner puts everything into perspective. 
3. The wealthy play the long game. They expect expenses to grow, and plan accordingly.
4. Inflation is real. Stack assets. 
5. Diversify with many streams of income. Think legs of a table. The amount you make can be limitless, but never be dependent on one. 
6. Money in the bank is money at rest. Never let money be stagnant. 
7. Wealth loves stealth.
8. Having good financial literacy is the foundation. 
9. Money attracts more money. Economic connectedness is real. 
10. Money is a means to an end. If you think money will make you happy, you’ll forever be broke.