Delaying Gratification: The Most Important Step To Becoming Rich

What is the difference between the people who become rich and those who don’t? Delaying gratification. What are we talking about?

Currently, there are more than 13 million credit cards in circulation in Australia. The average credit card has an accrued interest of $1382. This means that Australia has a national debt accruing interest of nearly $19 billion. [Source]

Why do we say this?

Have a guess at how many people who hold a credit card are making smart purchases using their card? Purchases that are either a necessity like food and utilities, or purchases that are building their wealth?

Probably not. They’ll most likely use it to book holidays, buy the latest gadgets, and clothes straight from the runway.

Maybe not on a credit card, but most people buy a new, fancy card on credit as well.

Why are we telling you all this? Accruing bad debt is a guarantee that you’ll never become rich.

But delaying gratification will.

One of the most important requirements to becoming rich is delaying gratification.

Don’t buy luxuries until you’ve built up your worth to afford them. “Keeping up with the Joneses” is a terrible mindset to have if you want to be financially free. As Dave Ramsey said:

“We buy things we don’t need with money we don’t have to impress people we don’t like.”

That’s all it is. It’s so simple in theory, but extremely difficult in practice. That’s why few people apply this simple principle in their lives. They don’t have the discipline. And that’s why they’ll never be financially free.

Build up your net worth first. Buy assets that will work for you and produce passive income. Invest in stocks, bonds, crypto, or even businesses before you buy shiny toys and fancy cars.

It doesn’t matter which investment vehicle you use, but just make sure that you have enough passive income to buy whatever luxury you want.

It sounds so simple, yet difficult to follow. Because most people aren’t disciplined.

Just remember to follow this simple concept, and you’ll be able to afford whatever your heart desires in the future.