article: 10 Reasons You’re Not Rich Yet...

[K-ice]

Is anyone else guilty of a few of these?

#1) You spend money like you’re already ricH

http://time.com/money/3944987/not-rich-yet/?xid=tcoshare

[James]

I don't agree with the emergency fund, you want that money working for you. Your expenses should be low enough to handle emergencies, and you should know how you would get the money in an emergency, but 6 months of spending just sitting in a bank account is rarely the best option.


I also disagree with the "one-trick investor". Many put their eggs in multiple baskets, all with poor returns and high expenses. Meanwhile you can get rich putting your eggs in one basket, as long as it is a good index fund with low expenses. Being charitable maybe that counts as thousands of baskets... :) but your portfolio doesn't need a complex mix of funds and various types of investments to be solid.


But the overall list is pretty good.

[zephyr911]

I don't agree with the emergency fund, you want that money working for you. Your expenses should be low enough to handle emergencies, and you should know how you would get the money in an emergency, but 6 months of spending just sitting in a bank account is rarely the best option.

Yep - the MMM springy debt cushion. Have money at your disposal without having to leave it uninvested.

Many put their eggs in multiple baskets, all with poor returns and high expenses.

Seriously, he never mentions either of those things. That's odd. Then again, this is classic Wall Street investment advice meant to lock you into the longest advisory relationship possible, so maximizing returns is irrelevant and lowering expenses would be suicide (from their end).

Meanwhile you can get rich putting your eggs in one basket, as long as it is a good index fund with low expenses. Being charitable maybe that counts as thousands of baskets...

While a broad ETF might meet the intent of that section, I'd never be comfortable with only stocks... I feel naked without real estate. YMMV :)

[MgoSam]

One thing I will say is that there is no said definition of "rich." I have to remind myself of that, that the term's definition changes for everyone. I personally dislike the term.

I live in a comfortable place, I never have to worry about getting enough to eat, have plenty of clean drinking water, have access to good friends. I make a living, and have savings should I need to draw upon them, I'm not overly worried about getting mugged on my way to work. If I ever want to cook, I have plenty of access to groceries, and should I ever decide to splurge I have hundreds of restaurants I can go to, where a staff will be geared towards serving me. In short, I have a better standard of living than over 70% of the current populace of the world (might be exaggerating the number), and probably live better than the richest person living in 1818.

[4alpacas]

#5: You’d rather complain than commit.

I completely agree with this reason.  I'm so tired of hearing people complain or reference luck. 

[EricP]

I don't agree with the emergency fund, you want that money working for you. Your expenses should be low enough to handle emergencies, and you should know how you would get the money in an emergency, but 6 months of spending just sitting in a bank account is rarely the best option.


I also disagree with the "one-trick investor". Many put their eggs in multiple baskets, all with poor returns and high expenses. Meanwhile you can get rich putting your eggs in one basket, as long as it is a good index fund with low expenses. Being charitable maybe that counts as thousands of baskets... :) but your portfolio doesn't need a complex mix of funds and various types of investments to be solid.


But the overall list is pretty good.

The linked article recommends using target date funds so I don't think she is recommending a complex mix of ivnestments, just trying to steer people away from being 100% into a single high cost sector fund or something like that.

[zephyr911]

One thing I will say is that there is no said definition of "rich." I have to remind myself of that, that the term's definition changes for everyone. I personally dislike the term.

I live in a comfortable place, I never have to worry about getting enough to eat, have plenty of clean drinking water, have access to good friends. I make a living, and have savings should I need to draw upon them, I'm not overly worried about getting mugged on my way to work. If I ever want to cook, I have plenty of access to groceries, and should I ever decide to splurge I have hundreds of restaurants I can go to, where a staff will be geared towards serving me. In short, I have a better standard of living than over 70% of the current populace of the world (might be exaggerating the number), and probably live better than the richest person living in 1818.

It's almost like you've read this article.

[MgoSam]

One thing I will say is that there is no said definition of "rich." I have to remind myself of that, that the term's definition changes for everyone. I personally dislike the term.

I live in a comfortable place, I never have to worry about getting enough to eat, have plenty of clean drinking water, have access to good friends. I make a living, and have savings should I need to draw upon them, I'm not overly worried about getting mugged on my way to work. If I ever want to cook, I have plenty of access to groceries, and should I ever decide to splurge I have hundreds of restaurants I can go to, where a staff will be geared towards serving me. In short, I have a better standard of living than over 70% of the current populace of the world (might be exaggerating the number), and probably live better than the richest person living in 1818.

It's almost like you've read this article.

Thanks, I was blanking on which article MMM had wrote on this subject.

[K-ice]

I just posted a thread about the opposite to the article.

Basically doing the opposite is why you are rich.

I felt it better belonged in Throw-down the gauntlet so here it is:

http://forum.mrmoneymustache.com/throw-down-the-gauntlet/10-reasons-why-you-are-rich/msg742853/#msg742853

[zephyr911]

I just posted a thread about the opposite to the article.

http://forum.mrmoneymustache.com/throw-down-the-gauntlet/10-reasons-why-you-are-rich/msg742853/#msg742853

LOVED IT

[Latwell]

One thing I will say is that there is no said definition of "rich." I have to remind myself of that, that the term's definition changes for everyone. I personally dislike the term.

In my previous job while early in college, I worked with two males who were a couple years ahead of me. You'd find them having the same ridiculous conversations almost every day. They'd debate about what salary figure they would be able to live on. The one guy would tell us it had to be 3 figures or he's going to just kill himself (he had a major gambling problem, so this was very troubling to listen to). I'd always make them clarify on what that lifestyle associated to that salary was. Is it $100k+ for your spouse and you combined? Does this include a child or two?

The two guys had crazy expectations. The other girl coworker who was also more money conscious, agreed with me that we could comfortably live on 1/2 of what the guys wanted. It was one of those moments where I realized how different people though based on how they were raised and where they were living. (The two guys were from fancypants town and thought the girl worker was a loser because she lived in an area that houses go for 1/5th of the type of house they currently lived in).

And now it's time to go back to "overheard at work" to complain haha.

[Middlesbrough]

#8 Don't Automate your life.

I don't do this. I have a plan and stick to it, but there are some things worth your attention every time you do them. I want to know exactly what came in and what went out. If something looks awry, I can go back and find out what happened. Works for me, but others just don't want to think about it. The plan is more important than how you do the job.

[lemanfan]

#8 Don't Automate your life.

I don't do this. I have a plan and stick to it, but there are some things worth your attention every time you do them. I want to know exactly what came in and what went out. If something looks awry, I can go back and find out what happened. Works for me, but others just don't want to think about it. The plan is more important than how you do the job.

I guess I'm not the only one who thinks its FUN and REWARDING to do the manual transfers at each paycheck - I know whats happening and I get a regular status check of my savings and investments.  :)