Doc’s note: Once a billionaire, always a billionaire, right? Not exactly… Building wealth is difficult, but keeping your wealth is just as difficult.
Today, to continue celebrating my publisher’s 20th anniversary, I’m sharing an essay from my good friend and colleague Steve Sjuggerud (longtime readers might remember this from 2017). He lists 10 tips to keep your wealth after you’ve worked hard to earn it.
Only 44% of 1995’s billionaires are still billionaires…
I don’t know about you… but that surprised me…
Is it that hard to hang on to a billion dollars? Where did their billion dollars go?
According to a 2016 report on billionaires from UBS Financial Services and PricewaterhouseCoopers, business failure was the primary culprit. (Death and family dilution were next.)
But what about the ones who kept their billions?
What did they do to keep the money they’d made and continue to grow it?
The authors gave their opinions… But I would rather hear advice on how to stay rich from a businessman who actually is ultra-rich. And perhaps no one knew more about the subject than the late Felix Dennis…
Dennis, if you don’t know, was the hard-living English entrepreneur who founded Maxim magazine, among many other things. He wrote the book How to Get Rich, a brutally honest – and entertaining – read.
Here are just a few of the gems from Dennis in Chapter 18 of How to Get Rich. As you’ll see, keeping your wealth, surprisingly, is about people:
1. Remember, you are only richer than them. Not smarter than them. If you do not employ a great many people smarter than you in your company, then you are either Albert Einstein reincarnated, or a fool.
2. Never stop looking for and promoting talent. If you get known for making use of it, the talent will start coming to you.
3. Lead. Do not be led. You have hired a bunch of talented boys and girls who are smarter than you. Great. But you are their leader… Your employees and advisors are just that: employees and advisors. You are the owner. You must lead.
4. Do not try to be friends with your staff. They know it’s phony, you know it’s phony, and they know that you know it’s phony.
5. As soon as you’ve spent it, gifted it, loaned it, or invested it, forget it. More angst and worry comes into the world from concern over past investments, loans, or gifts than can be imagined. It’s gone. Forget it.
6. Get your “first-flush barminess” out of your system as fast as possible. You’re going to do it if you get rich. You are going to buy a sodding great big house, then more houses… etc., etc. But the sooner you can work through this “barmy” phase, the better…
7. If you’re bored with a business, sell it. Your lack of enthusiasm leaks out of you and infects those around you.
8. Try to sell before you have to. Your companies are not your “babies.” They are tools for acquiring wealth. Try to sell them before they peak.
9. Never loan your money to friends. If you loan money to a friend, you will lose your friend as well as your money.
10. Your oldest friends are your only friends. Only your old, trusted mates can tell you when you’re out of order.
I have recommended this book many times before.
Dennis lived his life in a completely different way than I do. He partied hard. (“I spent a hell of a lot of what I made on sex and drugs and rock ‘n’ roll. The rest – I wasted.”) He died in 2014.
The thing is, you don’t have to agree with the way he lived to learn something from him.
From what I have read, he speaks the truth, better than I have read elsewhere, about how to get rich and stay rich. You might not want to hear what he has to say, but I think he’s right on the money.
How to Get Rich by Felix Dennis is an entertaining – and surprisingly correct – view of what it takes to make money and keep it. You don’t have to live like him to learn from him…