Get Richer Everyday

How can we make everyday count towards our definition of success? How you spend your time is your freedom, and there is a lot of beauty in that. For high achievers, here is how you get richer every day.

I am going to start this article with a quote from Benjamin Graham. He once told his apprentice, "money isn't making that much difference in how you and I live. We're both going down to the cafeteria for lunch and working every day and having a good time. So don't worry about money, because it won't make much difference in how you live."

His apprentice was Warren Buffet, one of the wealthiest men of all time. Warren Buffett was notorious in the way he spent his money. He didn't spend a dime where he didn't have to! The advice here, enjoy your simple life, save your money, and invest wisely. Follow Warren Buffett's first rule: Never lose money. This sounds funny, but it is sound wisdom. Here are three things you can do to apply this strategy in your life.

1. Living Frugal

Keep your expenses as low as possible. Live at home with your parents while you are going to school, so you don't acquire unneeded debt. Instead of spending $50 a week at your local bar, save that money and invest it wisely. Imagine the amount of time and money you will acquire from skipping the bar and working towards your dreams instead.

What's cool for 20-year-olds? I like to think it's fashionable clothes, new cars, and the best technology on the market. I have a cracked iPhone. It's been cracked for over a year now. The cracks don't impair the use of my cellphone and its optimal performance. I'd rather spend my money on books that improve my skills or buying good food that compliments my workout regimen. We all have our own definition of living frugally. What's yours?

I live by this statement (most of the time), which I wrote on the whiteboard in my room: Don't spend money on things that won't give lasting benefits.

Live below your means, and create outcomes that pay you back, not ones that take from your performance.

2. Invest Defensively

It isn't common for investors to get rich through investing alone. Hedge fund managers barely beat the market, and if they do, it is often considered luck. Individual stocks have excellent upside potential, but they also have a risk of falling into the deep end. Invest in index funds that keep pace with market returns. This way, you don't have to check how the market is performing every day/week, and you can defensively generate profits from afar. Discover the best index funds to invest in and how to set up a portfolio that breeds long-term success with my book.

3. Diversify Your Income

Investing in index funds is not to make money. WHAT!? It is a way of building wealth and not losing your money. Making money is what you do today. If you are a mechanic, construction worker, software engineer, assembly line employee, or self-employed, this is the way you make your money.

The key is to diversify your income streams and not solely depend on your employer for 100% of your income. Things will get tough in life. If a family member passes away, you become ill, or you hate your job and want to quit, you need to be sure you have income from another source in order to survive.

Key: Generate more money. Then invest in assets that pay you back.

Points 1, 2, and 3 tie together:

1. Live below your means so you can save the money you currently would otherwise spend

2. Invest defensively to generate wealth on the side

3. Diversify your income streams so if a hard time is ahead, you will be prepared

Enjoy and see the beauty in the life you have. After all, no one lives the same life as you. Make it count.

All the best,

Dan Sarver