Grant Cardone, at the age of 64, reflects on his journey to achieving a multimillion-dollar net worth, which required two decades of trial and error. Presently, he derives income from the 18 companies he founded and the ownership of 12,000 apartment units.
In hindsight, Grant wishes he had grasped earlier the mindset of ultra-wealthy individuals when it comes to money. Throughout his investing career, he has cultivated relationships with numerous millionaires and dedicated years to studying their financial habits.
He now shares eight money secrets that these affluent individuals are privy to, which remain largely unknown to most of us:
As a general practice, diversifying one’s investment portfolio by allocating funds to various stocks, funds, and other assets is advisable. However, when it comes to the wealthiest individuals increasing their net worth, a different approach often emerges. They tend to initially concentrate their investments in their own projects and subsequently diversify their holdings as they accrue more wealth.
For instance, Elon Musk serves as a notable example. He committed the entire $22 million he earned from the sale of his initial venture, an online business directory named Zip2, into his next enterprise, an online banking service known as X.com. Following X.com’s merger with PayPal, Musk realized a substantial $180 million from PayPal’s sale to eBay. This windfall provided him with the financial resources to further invest in ventures such as Tesla, SpaceX, and other ambitious endeavors.
As he steadily expanded his net worth, he made a conscious decision to avoid incurring debt for non-essential expenses such as designer clothing or lavish residences. Despite having the financial means to cover these costs, he was resolute in not squandering money on interest payments. Instead, he channeled all his earnings into endeavors aimed at generating more wealth, primarily his business.
Furthermore, he adopted a cash-only approach when acquiring homes and made sure never to accrue any interest on credit card balances. However, he recognized that in certain circumstances, particularly when endeavoring to build a business, strategically employed debt could serve as a valuable tool, granting access to income-generating assets at an accelerated pace.
One might commonly associate the idea of acquiring a primary residence with the quintessential “American Dream,” but it’s not often the initial choice for the wealthy.
From his perspective, homeownership doesn’t consistently yield the same return on investment as alternative avenues for capital allocation. He personally possesses three homes, but he opted to acquire them only when he had the financial capacity to purchase them outright with cash.
Conversely, cash-flow real estate, which encompasses commercial properties generating a monthly profit through rental income after covering mortgage payments, property taxes, and maintenance, represents an excellent means to enhance one’s wealth.
This form of investment offers the potential for passive income through property ownership and often proves more straightforward to sell compared to a primary residence. When selling a primary residence, the challenge lies in locating a buyer who can envision themselves living there. However, when selling a lucrative rental property, the search narrows down to finding a buyer who seeks a profitable investment opportunity.
Affluent individuals are often inclined to invest more in each purchase, with the objective of obtaining a superior unit price and reducing the time spent on repetitive, unproductive activities.
This principle extends to both business and personal life. Wealthy individuals may opt to enter into contracts to procure supplies or equipment in bulk for their businesses. Likewise, in their personal lives, when feasible, they choose to purchase non-perishable items in large quantities.
Grant Cardone has never experienced someone investing in him without a prior acquaintance. The majority of the real estate in his possession today was obtained from sellers who chose him over other qualified buyers due to their pre-existing relationships and their faith in his capacity to successfully close deals.
The process of building rapport and fostering connections holds significant weight. The more individuals get to know you, the greater the trust and belief they place in your abilities and expertise. This, in turn, paves the way for enhanced opportunities, expedited decision-making, and more favorable profit margins.
As a result, it is advisable to allocate both time and resources toward initiating and nurturing these vital connections.
In a conversation with one of his friends, a seasoned CEO with a track record of collaborating with some of the world’s wealthiest individuals, Grant Cardone sought to discern what common traits these prosperous figures shared. His friend’s response was succinct: “None of them were ever satisfied with what they had already accomplished, but instead focused on the next thing that could be accomplished.”
A prevailing characteristic among the wealthy is their perpetual dissatisfaction with past achievements. They maintain a steadfast belief in their capacity to achieve more, fostering a mindset that consistently directs their attention toward what lies ahead. This inclination to continually strive for more contributes to their ability to envision grandiose future prospects, whether in the realm of business, innovation, investments, or other wealth-building avenues.
The affluent understand that time stands as the sole genuinely scarce resource, one that cannot be purchased or replenished.
In light of this, they adopt a strategy aimed at optimizing their time by relinquishing the compulsion to micromanage every minute detail of their business or portfolio. Instead, they become adept at outsourcing and delegating responsibilities to capable, intelligent individuals who are willing to trade their time for monetary compensation. This approach allows them to make the most of their valuable time while entrusting essential tasks to the right professionals.
Source: cnbc.com
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