“Wealth isn’t about how much money you make – wealth is about how much money you save and invest.”
The true measure of financial success isn’t how much money you make—it’s how much you keep. That’s a function of how well you’re able to save money, protect it, and invest it over the long term.
Sadly, most Americans are lousy at this.
Even after a decade of steady economic expansion and record-breaking stock markets, almost two-thirds of earners would be hard-pressed to cover an unexpected $1,000 expense—a medical bill, car repair, or busted furnace—and more than 75% don’t save enough or invest skillfully enough to meet modest long-term retirement goals, according to Bankrate.com.
Even wealthy families aren’t getting it right: 70% lose wealth by their second generation, and 90% by their third. “Shirtsleeves to shirtsleeves in three generations,” as a saying often attributed to Andrew Carnegie goes.
What’s at the root of these bleak data? Stagnant salaries amid rising costs of health care, education, housing, and other big-ticket necessities have put a major strain on folks of all ages. But advisors point to a deeper issue: an almost universal lack of financial literacy.
“This is a much bigger problem than most people are aware of,” says Spuds Powell, managing director at Kayne Anderson Rudnick Wealth Management in Los Angeles. “I’m constantly amazed at how common it is for clients, even sophisticated ones, to be lacking in financial literacy.”
The ten rules for financial success are:
- Set goals
- Know what you’ve got and know what you need
- Save systematically
- Invest in your retirement plan
- Invest for growth
- Avoid bad debt
- Don’t overpay for anything
- Protect yourself
- Keep it simple
- Seek unbiased advice
— Read on www.barrons.com/articles/10-rules-for-financial-success-51558742435