John Mauldin’s weekly letter summarizes well the coming retirement crunch for the baby boomers. In short, perhaps 70% of all boomers will not have the money they think they need to retire on. Looks like a big wake-up call in the making, with implications for the entire global economy. His weekly letter finishes with a list from a book by Michael Masterson called “Automatic Wealth – the Six Steps to Financial Independence.”
It would be simple to say that from now on when I get a question about how one can become wealthy I will refer them to “Automatic Wealth.” But the book is more about than some formula for getting wealthy. It is to some degree a book about the philosophy of wealth and money, as well as the role it plays in our life.
The Eight Habits of Wealthy People
Michael recognizes that money is not the most important thing in life. As he notes, he knows a lot of rich people who are miserable. However, not having money is even more stressful. Money is simply a tool. And some people seem to have the knack for accumulating it. Masterson gives us eight habits of wealthy people.
A. Wealthy people work hard.
B. Wealthy people are good at what they do.
C. Wealthy people have multiple streams of income.
D. Wealthy people live in (relatively) inexpensive homes.
E. Wealthy people are moderate in spending.
F. Wealthy people are extraordinary at saving.
G. Wealthy people pay themselves first.
H. Wealthy people count their money.
Seems a pretty good list. Makes me wonder how it might be applied to being wealthy in ways other than financial. I’m especially intrigued with the implications of G, paying oneself first. How does that translate to other things? How does it relate or not relate to generosity. Can one be generous first and still become wealthy? Or does the giving necessarily happen after the money gathering? Worth noting, I think, that most of these, as habits, are more concerned with how we manage the flows of money, rather than how we manage the stocks. It’s these habits of flow that might be generalized to other kinds of flows in our lives. Seeing these as about flows rather than stocks leaves space for generosity, a flow of giving, as well. Though I’m still surprised that giving and generosity aren’t named more explicitly.