Monday, November 3, 2014

How Rich People Think by Steve Siebold

 A while back, I read an article with excerpts from Siebold's book online, and found it so interesting, that I put it on my TBR list, waited for ages for my local library to get a copy, then even longer before my hold came to the top of the list. Now that I've finally started reading it, I think the article cherry-picked the best points out of the book, as I'm finding a great deal of it repetitive and, well, the best adjective is perhaps... "unsupported" as if he just pulled some assumptions out of thin air and run with them.

The format of the book is a series of paired statements beginning with "The middle class..." and "World class..."comparing the two groups. "World class" appears to be used interchangeably with "the rich" and "middle class" with "the poor", but he doesn't really define "world class" very well, though a partial definition appears twenty one chapters in, when he attempts to separate the "upper class" or ruthless rich, from the world class rich,

"Are some rich people ruthless? Of course, but that type of people we define as 'upper class.' Upper class consciousness is an ego-based level of thinking rooted in fear and scarcity, and some people operating at this level become rich. The world-class level of thinking is spirit-based with its roots firmly planted in love and abundance."

I agree with Siebold in his assumption that - all other things being equal - the difference between financial success and failure is largely (he would say entirely) a product of how a person thinks about money. I firmly believe that any citizen of the U.S. has the opportunity to rise above their circumstances and become as successful as they want to be, if they will quit listening to the lies told by their friends, family, the news media, their local politicians, their schoolteachers, and coworkers, and be set free by the truth. That said, I also firmly believe that the results, as in pretty much everything else in life, will probably fall into a bell curve distribution, with a very small upper "head" succeeding beyond their wildest dreams, the vast majority landing somewhere in the middle, and a narrow "tail" bringing up the rear in abject failure. This is simply the nature of the world as we know it.

One of the best features of this book, from my point of view, is its function as a virtual bibliography of books on finances and success. At the tail end of each chapter there is the title of a relevant book for all you "world class" thinkers to read. I'm taking notes and putting a number of them on my wish list at the library.

Some pertinent quotes that I liked:

"Identify the biggest problem in your business or industry, that if solved, would earn you a fortune. Then go solve it."

I like that thought.

"While the masses are memorizing box scores and batting averages, the world class is directing the same amount of mental energy into revenue producing ideas."


"While the masses are playing video games, watching television and surfing the internet, champions are setting goals and designing strategies to make them a reality."

Not to mention the masses' wondering what is happening with the royal babies, and actually caring about Brittany Spears' latest trip to rehab, or falling for the latest conspiracy theory.

"Middle class earns money doing things they don't like to do...World class gets rich doing what they love."

I'm sorry, the first may be true, but the second is, once again, a perpetuation of the idea of "do what you love and the money will follow." The only people statistically speaking who are getting rich off this idea are the ones writing books touting such foolish advice.

I have yet to get rich by reading science fiction and fantasy books or, for that matter, by writing about what I've read. There's simply not that much of a market for my opinions. I could make a decent living running my own restaurant, or a catering business, but it's highly unlikely that I'll become a million- or billionaire doing so. Now, if I had figured out that there was a huge market for people to buy science fiction and fantasy online a decade or so ago, I could have founded Amazon, but my last name is not Bezos. One of these days I'll have to read his bio, but I'm pretty certain it wasn't a love of reading that got him to where he is today.

The question has yet to be answered, "Can you become rich/wealthy by doing something you hate well enough and long enough?"

"Don't let the opinions of the average man sway you. Dream and he thinks you're crazy. Succeed, and he thinks you're lucky. Acquire wealth, and he thinks you're greedy. Pay no attention. He simply doesn't understand." Robert Allen

Great stuff there.

"The most frequently uttered comment of the middle class in reference to money is "I can't afford it". Rich people know not being solvent enough to personally afford something is not relevant. The real question is, "is this worth buying, investing in, or pursuing?" If so, the wealthy know money is always available because rich people are always looking for great investments and superior performers to make those investments profitable. The great ones are aware that it's easier to borrow ten million than ten thousand, a critical non-linear concept to know when raising capital." (emphasis mine)

This one is very very true. Dave Ramsey is right when he criticizes consumer loans as a bad idea. Paying interest to purchase a depreciating asset (which nearly everything we middle class buy is) is a bad bad investment. A number of very successful people I have known in my life, however, use other people's money, wisely borrowed on favorable terms, quite regularly in order to make sound investments in property, the markets, or business. Not going to go all Adam Smith on y'all, but ready access to capital has been the root of all success in the last couple of centuries.

An action step:

"Start telling yourself on a daily basis that money is your friend and a positive force in your life, and your mind will go to work to help you acquire more."

This one just gets me giggling. It reminds me of a  recurring SNL sketch for some reason.

Regarding the world class,

"Materialism is only part of their motivation, the strongest for most is the freedom to do what they want when they want."

Oh Lord, don't we all want that?

This one is worth reading for the nuggets of gold inside, and especially for the bibliography stuff.

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