Why The 1% Aren't The 99%

"In order to make money, you have to spend money." Everyone has heard this adage before, but there's another that, when coupled with the first, makes it all the more poignant. "Everything in moderation."

A lot of people, myself included, spend too much on entertainment and the little luxuries in life. So much so that it is to the detriment of ourselves. Many have the mentality that instant gratification is the way to happiness without realizing that doing so is the whole reason for their misery.

The more you spend on entertainment the less you have to invest. As you pay more and more on the things you want, new tv, video games, movies, car, debt piles up in the background because of a lack of savings.

The 1% are the ones who best knew how to apply the two quotes above. They have self control against entertainment spending (at least they must have in the beginning) and were able to use either their debt or their own savings to get the most gain. By moderating their spending in the interim they were able to gradually increase their assets and cash.

I'm going to take the two quotes and combine them: "In order to make money, you have to spend money in the right places." A little bit more specific and relevant don't you think?

Now, I just have to get rid of my debt so I can start investing.