While making money is a popular life goal only a few people
understand the laws of money thing is there exists a set of laws that define
how to make maintain and coexist with money
understanding these fundamental laws is crucial
for crossing over to the wealthy side which is why in this video
i'll be sharing with you seven money laws only rich people know
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life changing content law number one the law of abundance picture this
there's an ancient gold mine down from where you live and there are two
types of people who live next to it the first group strongly believes that tons
of hidden gold deposits exist beneath the gold mine however the second
group believes that there are only negligible fragments of gold within the
mine and that people will most likely
scramble for them which group do you think will unleash
their tools and start digging to extract the gold
you guessed right the first group and this example rolls out the first bunny
law that only rich people know the law of abundance this law dictates
that the universe is endowed with limitless resources for us
all to enjoy these resources can include basic things like
food and they can also include financial resources like money the law of
abundance puts forward the belief that there's no shortage of money-making
methods since there's more than enough money to be made
according to the law of abundance any person who looks forward to building
wealth should ensure their mind is dancing to
the tune of abundance because true enough there's incredible
power in whatever you choose to believe in
and your mindset can be a huge limiting factor to your financial journey
if you believe in abundance you will attract abundance and if
on the other hand you subscribe to the scarcity mentality
that is precisely what you will attract individuals with a scarcity mindset will
rarely push themselves to build wealth according to them there is very little
wealth to be accumulated in the first place
and this tiny bit is supposed to be shared amongst millions of people
by thinking that wealth is for only the chosen few
such people end up sabotaging their own wealth building journeys
even before they begin for you to become rich you must wholeheartedly embrace the
law of abundance remind yourself that there is an endless
string of financial opportunities for you and other people
if you do this you won't be intimidated to put your skills out there
and earn your fair share of cash law number two
the law of capital i'm sure you've heard this repeatedly
that you should use money to make money this famous saying holds immense truth
and aligns with the second law of money which is the law of capital this law
draws from the idea the capital can be the kindle to your fire when starting to
grow your wealth in the same way that you need to
assemble your building materials and labor before putting up a house
you will need sufficient starting capital to build wealth
in a business scenario this capital refers to the money or essential assets
an entrepreneur uses to create wealth capital is what the business uses to
purchase more assets acquire additional stock and higher labor
contributing to generating profits usually business capital exists in two
forms debt and equity debt refers to the
borrowed capital acquired from creditors and other financiers
if the business is still at the nascent stage taking debt is the easiest method
of acquiring capital equity on the other hand refers to the process of giving up
part of the business ownership to external investors
this gives investors the right to a share of the company's profits in
exchange for financing what i'm trying to say is this building
wealth warrants a strong foundation especially in the form of financial
resources whether you need to start a successful business or invest in real
estate having capital will make the process
more bearable and susceptible to success having substantial capital will
streamline business operations and enable the owner to meet their
expenses and start attracting profits law number three the law of saving
while the law of saving might sound like a no-brainer it is
often overlooked by many also known as the law of conservatism
this law emphasizes the importance of setting aside a stash of cash to use
for future investments or financial emergencies this is why you must always
spend less than you're making according to experts individuals who
attain complete financial independence are those who create the habit of saving
money if you dig deep you find that these
individuals save at least 10 percent of their income throughout their lives
there are many incredible benefits of saving money from laying a foundation
for future investments to cushioning you from potential market
risks in other words saving money is like
buying a ticket to generating wealth but sadly it's only the rich people that
recognize the secret while the average joe embarks on a
spending spree and exhausts his monthly paycheck
the millionaire will only spend a fraction of his income
and save the rest this is why ordinary people will never understand why wealthy
people spend money with caution despite having rich bank accounts the
law of saving is broken down entirely in george clayson's book titled the richest
man in babylon this book states that the most
preliminary step in saving money is to pay yourself
first you can do this by stashing away 10 of your monthly earnings and a safe
fund that isn't accessible to you ensure that
this money remains untouched unless you're using it to
finance your long-term investments besides this great lesson there are many
others in this iconic personal finance novel and by following the link in the
description below you can get a free copy of the audiobook
from audible today law number four the law of investing
the law of investing embraces the thought that the only sure path to
financial freedom is through investment investing refers to channeling money
into financial assets in order to generate profits from them
the most common investment forms include financial markets like real estate
forex and stock markets assuming you invest
two thousand dollars in real estate today you will reap almost double
if you leave it in the market for ten years however this law also emphasizes
the importance of conducting due diligence before
investing make sure you study and understand the market before
pumping your money into it you can do this by reading investment books or
joining investment clubs to network with successful investors
because if done right investing allows your money to snowball
over time thanks to factors like compound
interest also note that investing isn't necessarily peg to plunging your money
into a market although often sidelined investing in
oneself is equally important it mostly refers to acquiring high
demand skills that give you a competitive edge financially
from a professional perspective this can mean going into a graduate school
program to get an mba or enrolling for an online course that
will upscale your financial value in the job market
self-investment can also go along the line of blocking the loopholes that hold
you back from exploiting your full potential
for example you might decide to start looking out for your health by eating
healthy and exercising by doing this you'll find that your
energy levels increase and that you're in a good mental space
to focus on your job or even take up an extra one
law number five the law of exchange typically money serves the purpose of a
medium of exchange in short money buys value which is why
in the business world it's essential to have a value driven
perspective by this i mean that in conformity with the law of exchange
entrepreneurs should realize that everything is a value exchange
from their time to the money that they possess when taking part in any form of
transaction whatsoever ask yourself whether the value you're
deriving matches your input always aim to derive maximum value from
any transaction you make if you're hiring employees within your
business for example assess whether the salary you're paying
them is worth the value that they bring to the table
and if you're investing in a paid online course consider whether the amount
you'll get from the course aligns with the money
and time you part with if you look at things this way you will
never leave money on the table and by this
i mean you will be able to block any little nudges that could waste your
money and derail your wealth building journey
law number six the law of time it is often said that time is a valuable
yet very fleeting resource and that time waits for no man
all these are nothing but the truth which brings us to the sixth money law
that only rich people know the law of time
according to this law how you spend your time will lay the foundation for your
financial future if you treat time with the level of
seriousness it deserves you will be more productive
but if you choose to play around with your time thinking that the clock will
tick twice you will hurt your chances of inching
any closer to financial success i tend to think that time is even more
important than money itself this is because time is the determining
factor of how much money you save and the extent to which this money can
grow if you choose to invest it in short time is the sole determining
factor in when you will achieve your financial goals
and this explains why successful business owners law timing as an
essential element that drives business success
you'll have to know when to launch a product when to buy or sell specific
stocks within the stock market and even when to stop although unknown
to most people time management isn't restricted to
productivity or how fast you can finish off tasks
it also eclipses the tendency to think quickly and make intelligent decisions
when faced with difficult situations having known this honing your time
management skills is crucial for becoming rich you can do this by
sharpening the pillars of time management planning
and knowing the difference between important versus urgent
tasks law number seven the law of accelerated growth
have you ever wondered how investments snowball over time and how different
investment ventures calculate the amount of interest your initial principal earns
to answer these questions and more let's look at the seventh law that only rich
people know the law of accelerated growth this law
is used heavily within personal finance this is the law which sheds light on how
investment returns are attained using compound interest
well it's pretty simple when you save or invest money that's earning compound
interest it essentially births additional earnings known as interest
with time these extra earnings will also accrue
their interest and the cycle will continue
so you'll find that with every bit of interest earned the initial principal
will change to accommodate the new interest so let's assume you had
saved a hundred dollars in a high interest savings account with a ten
percent annual interest rate in one year your money will earn
interest of ten dollars which will bring the new principal to a hundred and ten
dollars within another year the new principal
which is now 110 will earn 11 in interest hence bringing
the new principal to 121 going by this trend you'll notice the
incredible power of compounding through earning compound interest one
can be able to grow their wealth exponentially
however while compound interest can pave the way for accelerated growth with
regard to savings it can also work against you especially
with borrowing money this is how banks make their money the
initial principle they lend you will grow
similarly thanks to compound interest no wonder you find rich people avoiding
high interest debts and if they do take them they will
always pay them off as quickly as possible thanks for watching
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