I have been rather privileged to live an interesting life so far and met many different characters along my travels including many people I would consider financially independent or successful; how we define financial independence or success is really a subjective test but my general guide is that if someone is working for fun and not money, they are financially successful in my eyes. Alas, I have only been able to learn a few of the many lessons they practice on a day in and day out basis but, given my own experiences and what I have learned from others, I would summarize the major lessons learned about money as follows:

1. Money has no emotion. Only a rate of return. Before formulating who, what and how to invest, the best investors in the world strip emotion out of the equation. Money has a great deal of emotion attached to it; it is the leading cause of fights among couples (from what people tell me), people hate to talk about it and it turns people very emotional. BUT, study the financially successful, and you will notice how emotion is stripped out of the equation. For example, Bill Gates is one of Warren Buffet’s best friends yet Buffet refuses to buy a single share of Microsoft (it doesn’t fit his rules of investing). Yet, how many times have we lent money to a friend we knew would never pay it back? We attached emotion to money.  Business is business between Gates and Buffet and their friendship separate and apart (and, perhaps, we would be of a greater service to our friends if we taught them to manage their finances rather than lent them money). The truly successful look strip emotion out of their financial decisions.
2. The only way for money to get any rate of return is to have more of it than the previous month. In other words, live within your means and make sure you have more coming in than out. ‘Nuff said.
3. Get lots of advice and, after hearing differing viewpoints, act decisively. Before Donald Trump’s Apprentice became unwatchable, I use to always notice how Trump had a team of advisors around him at all times. I suspect it was partially for vanity but if you watched the show, notice how Trump always asked his advisors what they thought even if you knew his mind was made up? He actively sought out other opinions BUT, after seeking their opinions, acted decisively (but not too decisively so that the decision would be fatal if it was a bad decision).  Remember there are three instances of redundancy in the word committee so, while one should always seek advice, decision by committee are half-measures at best.
4. Have money execute a strategy rather than chase a product. I often wondered how many people who say “have a got a hot stock tip for you” are financially successful? They are selling product and product comes and go plus you end up with a mix of product which may not necessarily fit well together. Find a strategy that works for you and which you have an edge on (something that interests you and are good at) and then find products to fit into that strategy rather than the other way around. Use Oprah as an example. The products she endorses or sells have no logical pattern to them until you consider what Oprah’s unique value proposition is- she is selling herself. She leverages herself onto product which have no real connection (book clubs, movie production, radio shows) but for the fact they are mediums in which she can sell herself to mass-markets.
5. Don’t give up. You have to want to be financially successful day after day, month after month, year after year. Its like being committed to be fit. Most people who lose weight gain it back again because they think a short-term fix will solve their problems. Those who succeed have a determination to it.  Being financially successful is not a comfortable process- you work hard so eventually your money works for you. But, like being fit, one does not become financially success for the sake of it- you do it to enjoy life and spend time with family. One thing I have noticed is that those who are great with their money don’t work conventional hours- they take summers off, weekends offs, every other Friday off; they achieved financial success to enjoy life.

One thing you will notice about the above list is how many of these factors have to do with mind-set rather than some specific skill set; most personal finance skills can be learned without great difficulty using the right resources. But creating a proper mind-set allows one to achieve success over and over again throughout life.

What always strikes me when I meet someone financially successful is not they have many degrees behind their name, understand rocket science or are charismatic (and many are not in the conventional sense) but they have a way of thinking that is so different than most of the population.

Have you ever meet anyone financially successful? What defined them beyond their net worth?