How The Rich Spend Their Money And Why You Should Start Doing It Too

Is it true that the rich spends differently than poor people?

The answer is Yes.

Today, I’m gonna share with you how the rich people spend their money and why you should do it too.

Poor People

Lets start with how poor people spends their money.

For poor people, when they receive their paycheque, lets say at $10,000 for demonstration purpose, they’ll immediately use the money to pay off their monthly bills.

ANIMATED INFOGRAPHICS 1

$5,000 into paying things which are necessary.

$4,000 into buying things they want.

$1,000 into savings (if lucky).

So whats wrong with this?

At the end of every month, poor people often ends with networth of about $1,000 if lucky.

This is what the line ‘Live paycheque to paycheque’ means.

Successful People

Successful people, on the other hand, when they receive their paycheque, spends differently.

Firstly, successful people have different philosophy when it comes to money management.

ANIMATED INFOGRAPHICS 1 (1)

They’ll put aside 30% for monthly commitments such as mortgages, car loans, etc.

And the remaining 70%, they’ll put aside for investment. Some successful people are even rumored to be able to invest up to 90% of their earned income.

0% will be put aside on things they want such as luxury goods or eating in restaurants

Once the money invested bears profits, they’ll use 10% from the dividends to buy luxury goods and so on.

In this way, their total networth remains between $6,000 – 7,000 plus dividends.

Now imagine they repeat this spending habit for years to come – this is the secret to true wealth.

My Two Cent

It’s clear, successful people spend with a long term plan in mind.

They continue to add more money into investment to be able to grow their net worth and also able to live off dividends alone

They know earned income is not permanent, therefore, don’t rely on it completely. In case of economic downturn, they’ll always have cash to rely; such as their other sources of income and savings.

On the other hand, the poor relies completely on their earned income. If they lose their jobs, they have nothing else to rely on.

Let me know what you think about the article in comment section below. I’d really like to know what you think about it

Keep grinding and hustling. Don’t forget to execute!

3 Easy Ways to Showcase Your Product’s Quality Online

Showcasing your product online is a crucial element of great online content. Since consumers find it difficult to visualize the product online, it becomes your priority to invest more resources on ensuring the message does not get lost.

Whilst hiring online content manager is a recommended solution, most startups simply could not afford to do so due to their ridiculous rate, giving established businesses the upper hand.

All that said, I sat down and reflected on it. Here are 3 cost-effective methods to showcase your brand’s service online:

Continue reading “3 Easy Ways to Showcase Your Product’s Quality Online”

3 Signs That You Will Become Rich One Day

ANIMATED INFOGRAPHICS 1 (2)

Ever wondered if you’re going to be a millionaire some day? Well, here are top 3 signs you’ll know you’ll be rich one day.

1. You always shoot for the moon

You know how the saying goes, “Shoot for the moon. Even if you miss, you’ll land amongst the stars.”

If you’re the type of person to strive for an A when you only need a B to pass the class, you have the mindset of a millionaire.

On a mission to become rich, shoot for $10 million, not $1 million.

Take a look at the successful billionaires of world, for average human being, it might seem like these successful people are out of their minds to be thinking of something out of the norm.

While no one achieves a 100% rate of successful attempts at running business, all it takes is for a single business idea to strike big like Dallas owner Mark Cuban often advises “All it takes is to be right once.”

Continue to think big.

2. You maintain an open mind

You are not afraid of new ideas and know that closed minds do not inspire faith, courage, belief and active imagination.

Successful millionaires change their psychological approach to money, success, and happiness.

“The person with a ‘closed’ mind on any subject seldom gets ahead,” writes Hill.

On the flip side, the wealthiest, most successful people are constantly seeking feedback and looking for ways to improve.

That’s why so many business leaders, including billionaire Richard Branson, claim to have never “made it,” despite their wild success.

3. Invest whatever you can

Being rich is not a question of one’s ability or fortune or even a sense of entitlement.

The question of why one is not wealthy can in most cases be simply attributed to the fact that they are not being investors.

Most times we think a large sum of money is required to start investing.

On the contrary, there are actually a number of investments out there that give good dividends for small amount of money. It’s all a matter of searching these investments out there. This is where being open minded helps. Always be open to new investment ideas.

I made a mistake of not investing in Bitcoin back when it was in low $200/unit. I did invest in it, but it was in small amount because I wasn’t too keen on the idea. If I had maintained an open mind and did my research about the blockchain technology behind it, I would have poured more into investment.

In fact, how much you save and invest is oftentimes more important than than the size of your paycheck.

My Two Cent

Now, you know the signs of whether or not you’ll be rich one day, start adopting this mentality to be another step closer to become rich.

Remember, there is no shortcut and if anyone tells you that, is just looking to sell their product! Thank you for watching and I’ll see you again. Keep hustling!

How To Improve Customer Experience and Customer Loyalty

ANIMATED INFOGRAPHICS 1 (1)

Frankly speaking, good customer experience leads to loyal customers. And loyal customers often leads to customer retention and great PR (two benefits every business should pursue) which is great since these primary drive for cost-effective and more sales.

Now, I’m not going to beat around the bush of its importance too much or how exactly it funnels to more sales at cheap expense. I might write more about it in the future. For now, let’s focus on how to improve your customers’ experience.

Let’s focus on Tesco, a giant UK company. I wrote a paper on Tesco back when I did my MBA and recommended 4 strategies on how to improve the company’s customers’ experience.

1.IMPROVE ONLINE PRESENCE

Tesco PLC is recommended to integrate its business entirely with the ‘online’ world (Schneider and Bertelsen, 2010). As discussed in the Johnston and Kong (2011) paper, customers enjoy being part of not only as consumers, but also to be part of the company’s future development leading to the co-creation value (Prahalad and Ramaswamy, 2004)

The company needs to be more involved online. Hiring an IT team to set up social media accounts such as Facebook, Twitter and LinkedIn will not suffice.

Tesco needs to be more involved to the extent of hiring a team of talented ‘social media’ managers who are not only socially active online, but also have strong value of online influence. Having strong presence in the social media is vital as it allows Tesco PLC to conduct business in more channels.

It could also provide as a platform for customers to conduct ‘troubleshooting’ benefitting the operation teams involved in continuous improvement. Customers will also enjoy engaging with Tesco front-liners as they feel they are a part of the brand.

By constantly engaging with customers, these create environment which contribute to service quality and customer satisfaction leading to loyal customers (Kandampully and Hu, 2007; Masceranhas et. al., 2006).

2. EMPOWER EMPLOYEES

Apart from that, Tesco could also employ the empowerment of employees approach which helps on improving the image of the company, hence brand value.

By providing conducive and secure work environment, employees will be more willing to work beyond the contract. Employees will also exchange view with customers on the level of happiness and motivation being employed in Tesco.

The best example of a company which works hard to keep employees happy is Starbucks. Every employee receives proper training, tools, job design and security which in return, enable them to be highly motivated. They are even trained to recognize returning customers – these lead to improving corporate image, an important factor to customer loyalty (Kandampully and Hu, 2007).

3. CREATIVE CORPORATE SOCIAL RESPONSIBILITY (CSR)

Another strategy to ensure customer loyalty is by having Tesco PLC be more involved in the charity work internationally and locally.

The suggested strategy for Tesco is similar to Tom’s Shoes (Tom’s, 2013), to the extent where the company would get customers to get ‘onboard’ in participating charity events organised by Tesco. In the context of Tesco PLC, the level of participation among the employees and customers will further influence emotional consumer experience, improving the corporate image which influences customer loyalty (Kandampully and Hu, 2007; Masceranhas et. al., 2006).

4. INTRODUCE NEW SALES CHANNEL(S)

As part of delivering great customer experience, it is suggested that Tesco PLC could benefit further by providing the ‘drive-through’ concept.

It works similar as companies in food and beverage industry, only the layout is different and transactions are performed without having the need for customers to get out of their car.

The new platform for Tesco PLC will provide new channel for business which is part of improving service quality – crucial factor to delivering customer experience and customer loyalty (Kandampully and Hu, 2007; Liljander and Strandvik, 1997).

REFERENCES

  1. Seth, N., Deshmukh, S.G., Vrat, P. (2005) “Service quality models: a review“, International Journal of Quality & Reliability Management, Vol. 22 Iss: 9, pp.913 – 949. Retrieved from DOI : 10.1108/02656710510625211
  2. Tom’s (2013). Available at : http://www.toms.com/
  3. Johnston, R., Kong, X. (2011) “The customer experience: a road-map for improvement“, Managing Service Quality, Vol. 21 Iss: 1, pp.5 – 24. Retrieved from DOI : 10.1108/09604521111100225
  4. Mascarenhas, O. A., Kesavan, R., Bernacchi, M. (2006) “Lasting customer loyalty: a total customer experience approach“, Journal of Consumer Marketing, Vol. 23 Iss: 7, pp.397 – 405. Retrieved from DOI : 10.1108/07363760610712939
  5. Teixeira, J., Patrício, L., Nunes, N. J., Nóbrega, L., Fisk, R. P., Constantine, L. (2012) “Customer experience modeling: from customer experience to service design“, Journal of Service Management, Vol. 23 Iss: 3, pp.362 – 376. Retrieved from DOI : 10.1108/09564231211248453
  6. Meyer, C., Schwager, A. (2007), “Understanding customer experience“, Harvard Business Review, Vol. 2007 No.February, pp.117-26. Retrieved from URL : http://hbr.org/2007/02/understanding-customer-experience/ar/1
  7. Prahalad, C. K., Ramaswamy, V. (2004). JOURNAL OF INTERACTIVE MARKETING VOLUME 18 / NUMBER 3 / SUMMER 2004. Published online in Wiley InterScience (www.interscience.wiley.com). DOI: 10.1002/dir.20015, http://deepblue.lib.umich.edu/bitstream/handle/2027.42/35225/20015_ftp.pdf
  8. Bharwani, S., Jauhari, V. (2013) “An exploratory study of competencies required to co-create memorable customer experiences in the hospitality industry“, International Journal of Contemporary Hospitality Management, Vol. 25 Iss: 6, pp.823 – 843. Retrieved from DOI : 10.1108/IJCHM-05-2012-0065
  9. Liljander, V., Strandvik, T. (1997) “Emotions in service satisfaction“, International Journal of Service Industry Management, Vol. 8 Iss: 2, pp.148 – 169. Retrieved from DOI : 10.1108/09564239710166272
  10. Kandampully, J., Suhartanto, D. (2000) “Customer loyalty in the hotel industry: the role of customer satisfaction and image“, International Journal of Contemporary Hospitality Management, Vol. 12 Iss: 6, pp.346 – 351. Retrieved from DOI : 10.1108/09596110010342559
  11. Espejel, J., Fandos, C., Flavián, C. (2008) “Consumer satisfaction: A key factor of consumer loyalty and buying intention of a PDO food product”, British Food Journal, Vol. 110 Iss: 9, pp.865 – 881. Retrieved from DOI : 10.1108/00070700810900585
  12. Johnson, C., Mathews, B. P. (1997) “The influence of experience on service expectations“, International Journal of Service Industry Management, Vol. 8 Iss: 4, pp.290 – 305. Retrieved from DOI : 10.1108/09564239710174381   
  13. Long-Tolbert, S. J., Gammoh, B. S. (2012) “In good and bad times: the interpersonal nature of brand love in service relationships“, Journal of Services Marketing, Vol. 26 Iss: 6, pp.391 – 402. Retrieved from DOI :  10.1108/08876041211257882  
  14. Kandampully, J., Hu, H. H. (2007) “Do hoteliers need to manage image to retain loyal customers?“, International Journal of Contemporary Hospitality Management, Vol. 19 Iss: 6, pp.435 – 443. Retrieved from DOI : 10.1108/09596110710775101
  15. Dick, A., Basu, K. (1994), “Customer loyalty: toward an integrated conceptual framework“, Journal of Marketing Science, Vol. 22 No.2, pp.99-113. Retrieved from URL : http://www.scribd.com/doc/135705548/Customer-Loyalty-Toward-an-Integrated-Conceptual-Framework
  16. Rowley, J. (2005) “The four Cs of customer loyalty“, Marketing Intelligence & Planning, Vol. 23 Iss: 6, pp.574 – 581. Retrieved from DOI : 10.1108/02634500510624138
  17. Duffy, D. L. (2003) “Internal and external factors which affect customer loyalty”, Journal of Consumer Marketing, Vol. 20 Iss: 5, pp.480 – 485. Retrieved from DOI : 10.1108/07363760310489715
  18. Schneider, M., Bertelsen, A. M., (2010). “Beyond Foursquare : The Next Generation of Customer Loyalty”. Harvard Business Review [blog] 4 October. Available at : http://blogs.hbr.org/2010/10/beyond-foursquare-the-next-gen/ [Accessed 3 Dec 2013]
  19. Morningstar (2013). Available at URL : http://financials.morningstar.com/ratios/r.html?t=TSCDF

8 Things Poor People Do That The Rich Don’t

To become rich, first, you need to stop doing things that make you poor.
In today’s article, I’d like to share with you the 10 things poor people do that the rich don’t. Let’s do this.

1. Poor People Focus On Saving

In truth, if you’re broke you need to make more, not save more. One of the things poor people do is stress over money.
On the other hand, rich people see it as a tool, a resource that can be used to get to where they need to be – which is to make more money.
Saved money does not grow, you need to put your money to work, don’t squirrel it away for when you’re too old to live your best life. Put into investment that gives good returns if you find the idea of running business is too challenging.

2. Poor People Get Paid Based On Time

It’s important to grasp that results are the real currency of the world, not effort. For some this is a shocking revelation.
It does not matter if you are the best at your specific job. If you are not contributing to the bigger picture you will be seen as just another number.
Don’t be afraid of making big moves, shock everyone and change the world.

3. Poor People Blame Others 

Don’t fall into the blame trap. Blaming external circumstances take away your power!
No matter the challenge, it is your responsibility to change it.
Rich people gain self confidence from knowing that their lives are in their own hands if they want better lives, they do better. Stop blaming, start acting.

4. Poor People Think They Have All The Answers

If you ask a poor person why they are poor they will give an answer or rather their belief, why they are poor giving mostly excuses. I may sound harsh, but if you listen, they never really talk about what they should have done, instead, they give reasons which they believe are valid.
One of the things poor people do is talking about other people rather than ideas. They’ll say they are not lucky or even go further to say rich people become who they are by lying and cheat. Poor people tend to be highly-opinionated about anything that is outside their realm of influence.
Rich people are continuously learning, continuously growing and stepping out over their own boundaries in the search for self development.
What’s worse than people than have an opinion on everything?
People that listen to them! It does not matter how perfectly you do things or how successful you become there will ALWAYS be haters.
Haters will drag you down to their level if you let them, that’s all they want, to feel equal.
Put the blinkers on, don’t look back, you’re not going that way.

5. The Rich use their time effectively

Poor people spend a lot of their time doing activities that do not bring any value. Browsing facebook, watching television etc.
While watching celebrity gossip might be interesting, it does not bring any value or benefit to you. It does however benefit the rich celebrity who instead of watching TV is on TV.
They are creating more content (gossip) while the poor are consuming it.
Of course not all media is bad, there are educational books, TV shows etc. And sometimes you need to simply disconnect from the World. That is fine.
However, if you are spending a lot of your time consuming mindless content, it could be a sign of something going on in your life that you do not like.
The rich and the succesful work on their growth, their mission and their problems first. Only then do they possibly consume some entertainment.
 

6. Poor people try to look rich

How often have you seen people trying to impress others with the things they own, the new car, the latest phone.
They are trying to look rich to impress those around them, even those that do not know them. These things are meant to show how succesful they are. How rich they are!
In fact, Poor people spend more on trying to look rich instead of working on actually getting rich. And, all of that stuff that they spend money on is holding them back.
These things that they are buying do not bring any real value. These things become a burden, you have to keep working to afford these luxuries.
How often do you see these type of guys ended up selling their expensive cars or homes? You know the answer to that.

7. Poor people don’t look at the bigger picture

While it is a good thing to be present – focusing on future goals is just as important. Truth is, poor people often lack to look into the bigger picture – or the future.
Focusing the smaller picture, or to focus in short term goal, it lacks direction which is an element to failure.

8. Poor people do what everyone else is doing

Lastly, this may sound arrogant, but in reality, if you do what everyone else is doing, you’re mostly gonna end up like EVERYONE ELSE – broke and average.
If you wish to become rich, you gotta do what the 1% does – which is to take road less traveled.

Ending

That’s it guys for today. Let me know what you think about the article and tell me if you think I’ve missed something.
Thank you for stopping by and see you again soon.
Happy weekend! And don’t forget to Execute.