Thursday, December 5, 2013

8 Money Management Habits Billionaires Have in Common

Bill Gates
Bill Gates
by Gabriela Motroc, 21st Century News: http://www.21stcenturynews.com.au/8-money-management-habits-billionaires-common/

The recipe for success when it comes to multiplying money is no secret; all you need is a good personal financial plan and a bit of self-restraint when handling your revenue.

“Ikea people do not drive flashy cars or stay at luxury hotels”, says Ingvar Kamprad, the CEO of Ikea; Warren Buffet still lives in the house he purchased in 1958 and Sergey Brin, co-founder of Google drives a Toyota Prius.

While this may sound like a joke for those who think that being one of the richest people in the world means driving cars that are worth millions of dollars or living in mansions the size of a whole city, wealth is not always equivalent to opulence.

According to Forbes, as of March 2013 there are 1,342 billionaires in the world, 405 more than in 2010. When skimming the list, you will find two similarities between most billionaires: 1) Real estate is a profitable domain and 2) diversifying one’s business is a golden rule to riches.

Seizing Opportunity

Managing money is not as easy as it seems and all it takes is to look at the world’s billionaires who not only live as normal life, but also give 90% of their fortune away, following the footsteps of Warren Buffet and Bill Gates.

However, entrepreneurism does not refer to giving or taking, but to seizing the opportunity, no matter when it comes.

For example, Bill Gates, the second richest person in the world didn’t want to wait until he finished college; instead he started Microsoft when he was still a student, thus proving that timing is everything in a world which waits for nobody.

Frugality

Frugality may seem like an irrelevant concept when looking at the Forbes list of the wealthiest people in the world, but judging from the lifestyle of people like Warren Buffet, Ingvar Kamprad or Bill Gates who are temperate when it comes to money, spending in moderation is the key to prosperity.

Taking risks

The world of business is not for everybody and businessmen who occupy the top places on the Forbes list are a living example.

One example of pursuing a dream and not thinking of the repercussions is Bill Gates’ decision to drop out of college; George Soros, globally known as the man who “broke the bank of England” is another billionaire who saw the chance to make money and followed anything but his rationale.

Having a Concept or Vision

As mentioned above, there are a few steps that plenty of billionaires take when climbing the ladder of wealth: being humble, yet sharp, taking risks yet always having a concept to work on.

Picturing a business is the model, which creates an empire and people like Larry Page and Sergey Brin, Google’s founders have found a way to give people the impossible by welcoming them into the world of information through a superior search engine.

Willingness to wait

Rome wasn’t built in a day and nor is a business. In order to become billionaires, entrepreneurs know that patience is gold. For example, Jeff Bezos, the CEO of Amazon had to wait approximately seven years until his business turned a profit.

Therefore, it becomes clear that although the steps to becoming a billionaire are easy to follow, one must go through all of them in order to be familiar with this world.

Buy, buy, buy

We mentioned earlier that plenty of the world’s billionaires have made a fortune in real estate, so if you want to take this road, one good piece of advice which comes from self-made moguls like Robert Kiyosaki and Donald Trump is to purchase commercial spaces like apartment complexes, shopping centers, office building and luxury hotels.

Also, after purchasing the spaces it is imperative to boost their value. You could follow J. Paul Getty’s lead and transform a hotel into an icon by convincing an important socialite to stay there, thus increasing the investment’s value.

Remain adamant

The fact that the business world is tough is no longer a secret and, more often than not, a businessman loses even millions of dollars.

You could take Kirk Kerkorian, CEO of Tracinda Corporation as an example; he made and lost millions but never gave up trying. As a result, he became a billionaire and got a grip on what it means to be a businessman.

Get married, stay married

It might sound controversial to say that billionaires should not get divorced, but the truth is that a divorce may become a million/billion-dollar deal if you don’t take care of your future.

Most Forbes billionaires are married and the others have secured their fortune through prenuptial agreements for fear of recapitulating oil mogul Harold Hamm’s situation.

In short, the divorce cost him approximately $5 billion and made plenty of billionaires tremble at the thought of losing a lifetime of fortunes.
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