7 Things You Should Avoid If You Want to Be Rich

Building true wealth requires more than just hard work; it requires making sacrifices that others are unwilling to make. If you want to avoid being average and achieve financial independence, you must move around specific traps that keep people poor. Below is a detailed analysis of the seven critical mistakes to avoid, based on self-made multi-millionaire.

1. How Can Prioritizing Skills Over Salary Boost Long-Term Wealth?

The first major pitfall to avoid is working solely for money. It is helpful to visualize two distinct career paths:

• Path A: You take a boring but well-paid job immediately. While your friends and parents may be proud of your earnings initially, your income potential will eventually plateau.
• Path B: You accept a challenging, lower-paying job that prioritizes learning. You may struggle to pay bills for a few years, but your long-term earning potential will eventually skyrocket.

Self-made millionaires almost exclusively follow Path B because it focuses on acquiring skills and equity rather than immediate cash. For example, taking an apprenticeship might offer low pay, but it treats your career like a “Swiss army knife,” adding high-income capabilities to your arsenal.

By learning a wide range of high income skills it makes it almost impossible for you to ever be broke again as you become your greatest asset.

In the modern economy, the most valuable skills to prioritize include copywriting, video editing, and coding. There is currently a shortage of high-quality talent in these areas, meaning the competition is not as tough as it seems for those who perform at a high standard.

2. How Can Owning Business Equity Accelerate Financial Freedom?

The second thing to avoid is ignoring Equity. Equity refers to owning a percentage of a business so you can benefit directly from its profits. While trading time for money has limits, equity decouples your earnings from your hours.

Three Ways to Acquire Equity:

• Start a Business: Founded companies naturally provide equity to the owner.
• Sweat Equity: If you are extremely skilled, you can earn a stake in a company by working for it.
• Purchase Equity: You can buy shares in existing businesses, though this is best done when you have the skills to help that business grow.

Important Note on Asking for Equity: While some experts suggest asking bosses for equity immediately, you must be realistic and self-aware. You generally need to work for someone first to gain the necessary skills to become “worthy of equity” before making such a request. Focusing too much on money early on blinds you to the importance of ownership, which is the primary vehicle for building massive wealth.

3. Why Does Buying Luxury Items Too Early Destroy Wealth Building?

A common mistake is falling for the “flexing game” by purchasing a luxury lifestyle before you can truly afford it. Seeing people on social media driving Ferraris or eating at expensive restaurants can be deceptive; many of these individuals are living a lie and drowning in debt to maintain appearances.

The Reality of Spending:

• 37% of Americans cannot afford an unexpected $400 expense.
• 60% of American households cannot afford to buy a new car.

If you buy depreciating items like designer clothes and flashy cars too early, you sabotage your ability to build wealth. Instead, you should invest in assets such as stocks, crypto, and real estate. The golden rule is to wait until your assets generate enough income to pay for your luxuries.

4. Why Is Building a Team Essential for Scaling a Business?

You must avoid the trap of trying to do everything yourself. No matter how talented you are, an individual cannot out-compete a cohesive group of talented people.

The “PayPal Mafia” Example: Elon Musk appears to be a solo genius, but his success began as part of a group that launched PayPal. When eBay bought PayPal for $1.5 billion, the team members (the “PayPal Mafia”) used their connections and capital to launch massive companies like YouTube, LinkedIn, Yelp, and SpaceX.

Leveraging Technology for Income: If you aren’t ready to launch a billion-dollar company, you can still leverage this principle by helping older business owners who struggle with technology. Tools like Odoo allow you to manage websites, invoices, and teams from a single platform. Young entrepreneurs have a distinct advantage here and can make significant money by bringing traditional businesses into the 21st century.