Becoming a successful entrepreneur is not easy. I spent five years studying 177 self-made millionaires and I have to say, they are among the most courageous, fearless individuals I have ever met. They put everything on the line. They took enormous risks in the pursuit of their dreams. If you want your children to grow up to be entrepreneurs, then there are certain things you can do as a parent to help them learn how to be an entrepreneur. [Read more…]

When parenting goes right, children excel in life, are upstanding citizens and add tremendous value to society. According my my Rich Habits research, good parenting is the #1 driver of success. Children who are raised in stable, mentoring and loving households grow up to beat the pants off their peers who were not so fortunate. Behind every successful child is a Mom and Dad who get that their most important role is that of a mentor. What makes a Dad a Super-Dad? Below is a list of characteristics I uncovered in my research that only Super-Dads possess:

• Super-Dads Read To Their Kids.
• Super-Dads Help Their Kids With Homework.
• Super-Dads Attend Their Kids Sporting Events.
• Super-Dads Are Affectionate.
• Super-Dads Help Set Rules and Enforce Rules.
• Super-Dads Make Their Kids Do Chores.
• Super-Dads Encourage Their Kids to Pursue Their Passions.
• Super-Dads Encourage Their Kids to Embark on Novel Activities.
• Super-Dads Play With Their Kids.
• Super-Dads Attend Parent-Teacher Conferences.
• Super-Dads Inspire Their Kids.
• Super-Dads Teach Their Kids to Exercise Regularly.
• Super-Dads Encourage Their Kids to Take Action and Help Them Find the Lesson in Failures and Mistakes.
• Super-Dads Console Their Kids When They Hurt.
• Super-Dads Teach Their Kids to Laugh.
• Super-Dads lavish Their Kids With Love.
• Super-Dads Infuse Their Kids With a Positive Mental Outlook.
• Super-Dads Take Their Kids to the Library.
• Super-Dads Teach Their Kids to Save.
• Super-Dads Exercise Regularly.
• Super-Dads Love to Read and Learn.
• Super-Dads Kiss and Hug Their Kids.
• Super-Dads Turn Their Cell Phones Off When With Their Kids.
• Super-Dads Dance and Sing Around the House.
• Super-Dads Know Every Friend Their Kids Have.
• Super-Dads Know Every Parent of Every Friend Their Kids Have.
• Super-Dads Don Not Gamble.
• Super-Dads Do Not Get Drunk.
• Super-Dads Do Not Do Drugs.
• Super-Dads Do Not Lose Their Temper.
• Super-Dads Do Not Hit Their Kids in Anger.
• Super-Dads Are Not Couch Potatoes.
• Super-Dads Do Not Break The Law.
• Last – Super-Dads Associate With Other Super-Dads.

I was 24 when I took my first flight in a plane. Growing up poor didn’t give me much of any opportunity to travel. In fact, it wasn’t until I started my career as a CPA that I realized how much I had missed out on. At Arthur Anderson I flew for the first time to Chicago. Woe. I was dumbstruck. Everything about that first trip I remember. Emotions do that. When stoked, they enable you to remember everything.

My initial dream, out of college, was… well honestly, I didn’t have one. I was a janitor. That’s what I was. That’s how I saw myself back in college. A janitor who happened to be going to college. Dreams? Come on. Who has dreams when you are scratching just to get by? Dreams, I believed back then, were something relegated to the rich. And back then, I hated the rich. They were everything I wasn’t. So, no dreams for me. [Read more…]

Sometimes rich people stop being rich. Things can go wrong. Sometimes those things that go wrong are outside the control of the wealthy (i.e. random bad luck) but more often than not they are things that are completely within their control.

As a CPA, I’ve been advising wealthy individuals in money matters for more than 30 years. Plus I spent five years studying the money habits of the rich and the poor (Rich Habits Study). In my CPA business and from my research, I’ve written books, articles and done many TV and radio interviews about the many blunders wealthy individuals make that cause their wealth to evaporate. You would think they’d know better but they don’t. The wealthy who make these mistakes all seem to be reading from the same script. So, I thought I’d share a few of the most common blunders of the rich that steal their wealth like a thief in the night:

1. Penny Wise and Pound Foolish – Many millionaires are frugal. By frugal, I mean they penny pinch dry cleaner costs, bank fees, credit card fees, landscaper costs, grooming expenses, such as haircuts and manicures, professional service fees, such as CPAs, attorneys, doctor and dentist charges. They will fight like a hell if they think they were overcharged for a grocery item or a restaurant charge. And then these same penny pinchers will go out and buy an expensive boat, Tesla, a diamond ring, Rolex, or take an absurdly expensive vacation. I have seen far too many wealthy business owners fight to keep wages down at their business only to spend their hard fought savings on yachts, big homes or expensive cars. It’s as if they have Jekyll and Hyde battling it out inside their very own minds. While it’s a Rich Habit to watch your pennies, it is a Poor Habit when you take those hard earned pennies and make an expensive emotional purchase.
2. Sheep in Wolf’s Clothing – The vast majority of the rich in my study and in my CPA practice are long-term investors. They buy, hold and never panic. In fact, when the economy turns south they might even double down on their investments, buying more at a discounted price. But I’ve seen some wealthy individuals who invest aggressively and continue to do so until the economy turns south. Then they panic and begin unloading their investments. These so-called “aggressive investors” are actually conservative investors in disguise. They are sheep in wolf’s clothing. And their wolf disguise comes flying off the moment they start losing money.
3. Ignore The Devil is in the Details – Most wealthy individuals become wealthy in one of four ways: #1 They Live Below Their Means (save more than they spend), #2 They Expand Their Means (grow their income), #3 They Do Both (save and grow income), or #4 They Inherit Their Money. Some of the individuals who fall into the Expand Their Means or Inherit Their Money categories have something in common – they often do not pay attention to the devil in the details. What I mean is that they don’t review their monthly bank statement, monthly bills or monthly credit card statements in order to make sure there are no unauthorized transactions or fees. They also don’t review certain transactions such as hotel bills, retail purchases or restaurant tabs to make sure they were not overcharged and paid the correct amount. They also don’t review their expenses at least once a year to see if they can reduce those expenses for the following year. For example, cable and cell phone costs keep going down due to increased competition. If you don’t spend any time trying to find the lowest price, it could result in you paying more than you should.
4. Eggs Are All in One Basket – In my Rich Habits study I discovered that those with the greatest amount of wealth had three or more streams of income. This was strategic. When one stream dries up due to economic downturns, the other streams of income can come to the rescue like a knight riding on a white horse. But some rich people make the mistake of tying the bulk of their assets up in one place, such as their own business or in real estate, two very illiquid investments. For these wealthy individuals, when something goes wrong they are forced to sell some of their investments at a discount or increase their debt by securing a loan or tapping their credit line.
5. Lack of Proper Planning – Another common money misstep is lack of proper planning. The three big missteps in this category include: #1 Lack of Adequate Retirement Planning, #2 Lack of Adequate Estate Planning and #3 Not Having an Updated Will. When Prince died he had no will and no estate planning. Settling an estate with an old will or no will at all increases the costs of probate. Also, without an estate plan in place, you will pay higher federal and state estate taxes and inheritance taxes. Millions of dollars of Prince’s estate will now go to paying the salaries of politicians.
6. Generous to a Fault – Too much of anything is bad and this applies with giving away your money. Once you give away your money, it’s gone. Self-made millionaires are pretty responsible when it comes to distributing their wealth to others in need, but those who inherit their money or where the money comes with little effort, have a tendency to be irresponsible with their giving. Those who don’t have to work very hard for their wealth simply do not value their money as much as they otherwise would and they have a tendency to give too much of it away to their family, friends or charities.  Once people find out you’re rich they hit you up for money. It can come from every direction and overwhelm you. Those who anticipate this deluge establish a maximum amount of money they are willing to give away every year.

Staying wealthy is not as hard as getting wealthy, but it’s still hard. Any one of these six missteps can act like an anchor dragging you down off your mountain of wealth. Being aware of them is probably the best insurance you can have to preserve your wealth.

We all have learned some important life lessons from our Moms. Here’s what I learned from my Mom:

• Show Empathy: Many people are going through some life crisis and kindness and compassion helps ease their pain. My Mom believed that we should be there to help others who were going through hard times.
• Be Generous: Help people who are struggling in life. Never ignore those in need. My Mom believed we were put here on earth to do good and that starts by helping those less fortunate.
• Attend Funerals: A death in the family is one of those life events I write and talk about a lot. When you attend funerals you put your relationships on steroids. Death of a loved one is painful. My Mom believed attending funerals shows you care.
• Laugh Every Day: Find a reason to be happy. Find something funny in everything in life. My Mom believed you can’t be sad when you’re laughing.
• Money is the Route of All Evil: Pursuing anything for the love of money alone is wrong. My Mom believed that we all have some innate talent and that we need to find something we are passionate about rather than something that will make us rich.
• You Can’t Control What You Can’t Control: Much of life is outside your control. My Mom believed that we should all just try every day to control what you can control and not worry about what is outside your control.
• Creative Pursuits Make You Happy: When you engage in anything that requires creativity you will be happy. My Mom loved playing the piano. She always had a smile on her face when she was playing piano. Writing and teaching makes me happy, so I write and teach every day. My Mom believed that when you develop a skill that exposes your inner creativity it will make you happy.
• Love: Show love to everyone you meet. Love solves most problems in life. My Mom believed that love was the most important thing in life.

What life lessons have you learned from your Mom?

My just released book, Change Your Habits, Change Your Life has hit #1 on Amazon. Thank you Yahoo, who put my book on their front page today. Also, I’m honored to be the official bookend for Dave Ramsey’s book Total Money Makeover.