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Entrepreneurship, Financial Freedom, Financial Independence, Investing, Self-Made Millionaires, Wealth

How Benjamin Franklin used 13 virtues to get rich

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“Tell me and I forget. Teach me and I remember. Involve me and I learn.” – Benjamin Franklin 

Benjamin Franklin is not only one of America’s founding fathers (known as one of the signatories the Declaration of Independence), but also its first millionaire.

He did this by investing in what he knew. That is how he built his fortune.

You can do the same to build yours.

I listen to what people have to say, but I always make my own decisions.

I research any industry I want to know and then focus on investing in what I know. I try to put my money where my values are.

I prefer consumer staples such as food, beverage, toothpaste, cleaning supplies, tissue, and other household items.

Companies like Proctor & Gamble, Colgate-Palmolive, Kimberly-Clark. Clorox, and PepsiCo.

You can find many of these companies included in many mutual funds such as any 500 index fund like the Standard & Poor’s 500 Index (S&P 500 index), the Vanguard 500 Index Fund Investor Shares (VFINX), the Fidelity Spartan 500 Index Investor Shares (FUSEX), the Schwab S&P 500 Index Fund (SWPPX) or the   T. Rowe Price Equity Index 500 Fund (PREIX).

I figured a good way to start my wealth journey was to learn about those that became wealthy.

Benjamin Franklin also created a list of 13 virtues to develop his character. This lets me know that your character is your destiny.

Here I provide you with his checklist. See which ones you can try to emulate to help you on your road to wealth accumulation.

THE 13 VIRTUES OF BENJAMIN FRANKLIN

In 1758, Benjamin Franklin published his essay The Way to Wealth.

Although, it was written 260 years ago, the advice still is holds up, even to this day.

Below is a copy of his checklist.

SPOTLIGHT ON FRUGALITY

My personal favorite is frugality because it includes all the other virtues.

Frugality is basically the will to spend money on what is important and avoiding spending on what is not.

Frugal is not being merely cheap or miserly like Ebenezer Scrooge.  See my post on Money Lessons I Learned from Scrooge McDuck. It is about saving money on things you do not really need.

Saving money allows you to put that money to work for you.

Imagine every dollar is a little soldier. What do soldiers do? They fight.

You have to fight for your money because everyone is trying to part it from you. Don’t let them.

Invest that money and each dollar (soldier) fights for you everyday 365/24/7. Even while you sleep.

FOCUS ON FRUGALITY

In this world, you’re on your own. Benjamin Franklin knew that. So, he set out to start a business in a field he knew. He was a printing apprentice and started a printing shop. He became an expert at that one thing and did it so well that people paid him for it.

He then reinvested the profits back into his business.

That is how he grew rich.

He knew to become wealthy, he had to ignore the charlatans or hype. He had to focus on himself and his spending habits.

And that is what you must do. Ignore the hype. Forget what everyone else says or thinks. Trust your gut.

FORGET THE FANCY SET OF WHEELS

You do not need a fancy car to make you happy. Ride a bike and get some exercise. Better yet, buy an inexpensive, older Chevy where the bumper looks like it will fall off any second.

Then people will be less likely to ask you for money, if they see you riding around in a clunker because they will think your broke, but it couldn’t be further from the truth.

It’s not that you do not like nice cars or can’t necessarily afford one. It’s that you choose not to spend your money on it. Sounds pretty good right?

And watch out for the hangers on. They tend to come around when your last name is followed by an M.D. or Esquire.

FORGET THE BIG HOUSE

You do not need a mansion to live in. You know what that does? It just causes you to spend more money to heat, cool, maintain, and furnish it.

You fill the home up with stuff. No one likes an empty corner. Every inch is piled high with stuff.

How is that stuff paid for? Usually with credit.

What happens if you need that money? For instance, homes need maintenance.

Do you know what the repair bill is for a roof on a mansion? Well, you don’t want to know. One thing we do know for sure is that it costs more than what you would spend on a smaller house.

What about PMI? Private mortgage insurance is what you must pay if you put down less than a 20% down payment. And folks, that money is on top of the insurance and a monthly mortgage payment. We aren’t talking chicken feed here. It can be hundreds of dollars per month!

What about property taxes? It can add hundreds or thousands to a monthly mortgage payment. That’s money that’s not working for you in the bank.

You want to be investment rich, not house poor.

Every dollar that goes toward the house, can’t be working for you in an investment account.

I know they say the value of the home will go up and your equity will increase as you are making the house payments. However, let’s not forget the 2008 housing bubble.

When that bubble burst, so did most folks equity. Foreclosure notices were going out in the mail all over the country. Many lost homes. And many have still not recovered.

FORGET THE DESIGNER CLOTHES

You know those people who say dress to impress. Well, that’s fine and dandy, if you can afford it. However, if you can’t swing it, then walk by the $400 clothing rack and head to the sales rack in the back. Forget sartorial superiority. Who wants to be the best-dressed poor person?

I now see more people walking around with designer purses today than I have seen at any other time I can remember. Who’s paying for it? Mr. credit card, that’s who.

I see people opening up store cards all the time.

They have so many different color credit cards in their wallet it looks like a skittles bag exploded.

Places are handing out applications for credit cards every, single day.

You must resist. Resist the urge to spend. Credit is seductive. The temptation is too great.

So you must decide, what is more important. Buying a designer’s clothing and paying for their summer home or funding your own future.

FORGET THE EXPENSIVE WATCHES AND JEWELRY

I read about an NBA player who had bought dozens of watches. And not just any watches, but Rolexes!

Just because. Well, hey, you know bosses got to be on time.

Do you know what those things retail for? Well, last time I checked, it could be anywhere from $2500 to $40,000 and up.

The guy could have started a college fund. He could have funded an entire small city of kids $1k college scholarships.

Who needs 30 watches? Someone who wants to know the exact moment they went bankrupt I guess.

FORGET THE EXOTIC VACATIONS

So you want to travel. That’s great. But unless you can afford it or do it on someone else’s dime (like for work).

You may just have to watch the latest episodes of House Hunter or any show on the travel channel.

I once read it is a great thing to go travel and see the world as it is a great education, it will only cost you: $25,000.

I think I’ll just read a good book on world travels instead and invest that money until it earns enough interest that I can pay for the trip with cash.

Here are some of my suggestions on traveling when your travel budget is on life support.

You want to see the northern lights in Iceland? See it on a YouTube video.

You want to go skiing in Switzerland, Aspen, France or Vail? Watch a travel show until you can afford it.

You want shopping sprees in Milan, Paris, Rome, New York’s Fifth Ave, or Rodeo Drive?  Focus on buying things that will appreciate in value. Clothes, once purchased, is money that’s burnt.

I know you watch the television shows and see all the families going to Disneyland or Hawaii. However, what they don’t tell you is how much it costs to go to these places. Lots of times the studio or the network is picking up the tab.

They do it for ratings. Because who wants to watch a show about people sitting on couches all day. They want to see the lifestyles of the rich not the broke and unknown. I say just stop watching those shows.

Focus your attention on earning and working. If your head is down working, you never can look up and notice what everyone else around you are doing.

FORGET FOMO (fear of missing out). It’s a myth.

I know plenty of people that go out, spend money, buy nice cars, big homes, fly to the islands, and go to lots of parties.

However, they are not the boss. They work a 9-to-5 just like everybody else. One missed check could cause havoc on their already precarious finances.

Many people are one paycheck away from being on the sidewalk.

Don’t be like them.

Practice the 13 virtues. Be frugal. Then you can live like no one else because you will actually be rich instead of acting like you are.

FORGET PRETENDING TO HAVE MONEY

Forget pretending to be rich. The only time bluffing works when it comes to money is at the poker table.

And you know what happens when the hand is over, the bluffing stops there.

So leave the bluffing at the table and check it at the door.

Remember that scene in the comedy movie Back to School with Rodney Dangerfield. He was a wealthy guy named Thornton Melon, but always said to his son: A man without an education is nothing.

There was one scene in the film where he was talking in class about being in business and all the things a businessman is doing to make it in the real-world.

The teacher disagrees with his assessment, even though he was coming from a place of information.

When the professor asks where to build the business after scolding Melon he replies, “How about fantasyland.”

When it comes to your money you cannot afford to live in a fantasy. You have to keep your feet planted firmly on the ground and your actions based in reality.

Earn money, save it, invest it, and get rich slow.

Financial Freedom, Investing

The greatest assets are people

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My father always says that America squanders its greatest asset: the people.

People are the greatest asset. Treat people with respect and it comes back to you.

“Karen, nothing is worth sacrificing your dignity and self-respect.” – Suzanne Somers in Step by Step (1991-1998)

The complete Step by Step series is currently streaming on Hulu for fans of the show, just fyi.

I learned this valuable lesson about respect many years ago when I was growing up. I was watching several different television shows, but a few stood out. They were ALF, Alvin and the Chipmunks, Amazing Stories, Family Matters, Mr. Belvedere, Punky Brewster and The A- team.

ALF 

Alf was a television show about an alien that aired on NBC from 1986-1990 and was also turned into an animated series twice; The Animated Series (1987-1988) and Alf Tales (1988-1989). From this show I learned to not judge people by what they look like, but by what’s on the inside, respect for others, and that it is not good to be petty.

ALVIN AND THE CHIPMUNKS

Alvin and the Chipmunks was an animated cartoon series that aired on NBC from 1983-1990. In the show, the boys learn life lessons that they pass on to the viewers. I remember that doing the right thing is its own reward and bullies never prosper in the long run. The very 1st episode entitled “The C-Team” aired on September 17, 1983.

In this first episode, the boys encounter bullies and they seek out Mr. T to ask for advice and help. Even though Mr. T was extremely busy, as in real life he was doing The A-Team live action and an animated cartoon series called Mister T (1983-1986), on the show he stopped what he was doing to help the Chipmunks. It taught me that an adult should take to the time to help and inspire children to do the right thing and there is value in teamwork.

AMAZING STORIES

Amazing Stories was an anthology series created by Steven Spielberg, that featured fantasy stories that aired on NBC for two seasons from 1985-1987. My absolute favorite episode is the one entitled “Gather Ye Acorns” and it starred Mark Hamill aka “Luke Skywalker” from “Star Wars” fame.

In this story, as a young boy, he decides to keep all his possessions as one day he was told they will make him a fortune. Little did he know it would take about 50 years or so to happen.

However, instead of giving into despair completely and hurting others, he took ownership of his decisions and even when he was down to his last dollar he still gifted a woman one of his most prized possessions given to him by his grandmother. He told her he would give her a beautiful vase for a beautiful lady. She offered to buy it from him after inquiring if he would sell it to her. This woman would end up writing him a check for $10,000. As the vase was a very rare one, and made during the 1930’s. His charm, attitude, and humility caused his darkest hour to turn into his greatest triumph.

If you are noticing a theme here with NBC cranking out and airing some great shows, you are not alone. NBC must be making a mint from all those residuals.

But I digress. Let’s get back to the subject at hand.

FAMILY MATTERS

Family Matters was a sitcom that ran for nine seasons from 1989-1998 on ABC and the last season on CBS. The show had many themes that kids and young adults deal with such as peer pressure, bullying, and drugs. The show is known for its nerdy breakout character Steve Urkel who would always show the audience that doing the right thing was always the right thing to do. He always stood up for the little guy, never gave into peer pressure or bullying of any kind, and always defended himself from anyone who would try to do him harm.

I learned this and that being smart could be an asset because Urkel was a science nerd and this helped him navigate the troubles in life, but he had a heart of gold and eventually won the heart of the woman he loved; Laura Winslow.

http://www.dailymotion.com/video/x399dug

MR. BELVEDERE

Mr. Belvedere was a sitcom that aired on ABC from 1985-1990 and ran for six seasons. The title character of the show was always helping the family he was employed for with various moral or ethical dilemmas. And at the end of every episode, he wrote in a journal the happenings of the day and the lessons he learned. This is part of what inspired me to write. I still keep a journal and to do list to this day. That’s how I am able to keep up with writing content for this blog. When I am inspired: I write it down.

 

PUNKY BREWSTER

Punky Brewster was a sitcom about a young girl being raised by a foster parent named Henry than ran on NBC for 4 seasons from 1984-1986. The show as also turned into an animated series (as was the thing to do back in the 80’s and 90’s) called It’s Punky Brewster (1985-1986). I saw the difference a foster parent could make in a kid’s life. They had so much love for each other. It inspires me to this day to be gracious, kind, and generous to others because you can make a difference.

THE A-TEAM

The A-Team was a television series that ran for five seasons on NBC from (1983-1987). The A-Team were members of a fictional United Sates Special Forces unit. What I liked about the show was the teamwork and camaraderie between the characters and their integrity. Although the show was fiction, I still remember what the real United States Army Special Forces motto is: De Oppresso Liber, which is Latin for to liberate the oppressed. Basically, you help those in need who cannot help themselves.

So, if you decide to pursue wealth, it is best to make sure you know why you are doing it and what you want to accomplish.

You cannot just save money as it has to circulate so that the world keeps moving. Circulating does not mean spending, but that money should be managed properly, accounted for, and readily available for others to use. Investing is the way to do this.

For example, investing $100,000 into stocks that yield an 8% rate of return could net you $1,000,000 in 30 years without adding another cent. That’s right, a cool million bucks just for breathing and letting your money stay put!

Remember this, whatever you choose to do, whether it is about fame, money, acting, dancing, singing, or donating, nothing is worth sacrificing your dignity and self-respect.

I say choose wisely. And I pity the fool who chooses money over people. Sorry, had to say it.

Got any inspiring stories? Share them and comment here. You never know who you may inspire.