How To Become Rich

You don't need to be rich to know how to become rich. And that's my excuse for writing this post. 

image: emirates247.com

There are a lot of ways to become rich. But I will be listing the only two legit ways I know of:

1. You can work with a company like Shell, Mobil, NLNG or Total, and save/invest more than half of your salary.
2. You can be like me, and try to give life to every business idea that hops into your head.

Obviously, you know I have no credibility as regards number 1. So the rest of this post will be on how to become rich by working your butt off.

And here are the steps:

1. Know where you are. You have to do a personal inventory. Write down what you are worth (what you have minus what you owe). Write down your age on the next line. Write 1 billion naira on the third line. Ask yourself, "If I continue the way I am, how many centuries will it take me to make 1 billion naira?" Trust me, there's no easier way to know where you are, financially. But don't take this too seriously, being a billionaire is not the only way to live a fulfilled life. 
2. Have a Budget. And follow it. Having a budget is not hard. You just document every expense you make on daily or weekly basis. Then compare it with a threshold you have set for the month. It's that simple. And the ways you can do this are numerous. I follow a simple method. Some people prefer having a budget worksheet. I have a phone app I use daily to log my expenses and categorize them. I have been doing this since 2011. And consistently, every day, since Sep 2012. If I resign my job today, I know just how much I need to survive every month. That's the beauty of tracking your expenses. Then a budget takes it one step further, you not only track your expenses, you set a threshold for them that you work towards and also plan your savings/investment. This is going put you on a good standing to begin growing your income consistently and pursuing big financial goals in a predictable manner.
3. Have an Emergency Fund. Having a good budget and following it will mean that you don't leave much money in your regular bank accounts. You have everything so well planned out that you end up with almost nothing at the end of the month (before salary comes in). But there will always be unpredictable expenses that a budget does not factor in. Expenses like helping a friend with part of the bill for a urgent life saving surgical operation. Or a sudden house or car repair. This is what having an emergency fund caters for. Have between 3 to 12 months living expense equivalent in a special savings account. You only use the money in it for emergencies. And you replenish the account as soon as possible. I have mine in a high yield savings account with Diamond bank (HIDA account). Having this prevents you from derailing from your long-term financial plans. You won't have any reason to liquidate your pension fund account or investment accounts prematurely (before they mature in your original plan). If you can, have a health insurance. In countries where it works very well, it's a necessity. It saves life, physically and financially.
4. Don't buy what you don't need. It's said that if you keep buying what you don't need, someday you will have to sell what you need. I didn't buy a new laptop for 5 years because I followed this rule. It's sometimes hard and following this rule will make us look frugal. But it's necessary if you want a great financial future. I struggle with following this rule, but I still fair better than most of the people I know. I can pack all my valuables into one bag. One BIG bag. The aim of this rule is to make you develop the good habit of a moderate lifestyle. A lifestyle that doesn't keep ballooning with every salary or income increase.
5. Invest, invest and invest. If you did that exercise in step 1, you will know that there's no way you can save your way to 1 billion naira. Even if you save all your income. The only way to make true wealth is by investing, investing and investing. First invest in yourself, increase your market value. Second, invest in sound relationships; network with the people who can become future business partners. Finally, invest all of the money you can spare; invest them in your own business ideas, in solid stocks and in other people's great ideas. And this is how Dangote likes to explain his wealth. And I believe him.
6. Don't lose yourself. Don't trade one poverty for another. Don't be so poor that all you have is money. Don't be a slave of your own money. Be like Richard Branson, do all the crazy things you've always wanted to do. Inspire others with your wealth.
7. Finally, start today. Yeah, start today. It's going to be a long journey; you have no time to waste. Or as my friend would say, "No time to check time."

All the best! See you at the billionaires club!