4 funny money habits that the rich need to stop smoking

When we think about the rich, we usually imagine luxury cars, sprawling palaces and elegant lunch. But wealth does not always come with wisdom – especially when it comes to Money customs. In fact, some of the financial behaviors in which the wealthy indulge are ridiculous.

Warren Buffett: 10 things that the poor missed money

find out: 10 genius things Warren Buffett says about your money

Gobankinghes spoke with Andrew Locenau, money expert and owner BeflunetinfinanceTo discuss the habits of higher funds, the wealthy needs to rethink.

He said: “As a wealth consultant, I saw some wild spending habits from my wealthy clients. Let me tell you that having money does not automatically mean that you are good in his management.” Here’s what Lookenau was adding about Unexplained spending by the elite category:

“I had this customer who had seven luxury cars worth about $ 2 million,” said Lucinot. Most of them sat in the dust in his mirror, violating it and Maintenance costs They were eating approximately $ 150,000 annually. “Such waste,” added.

Instead of collecting cars, Lokenau got his client Invest in a variety of wallets This now generates more than 12 % returns.

The best step: If you love cars, you should rent one luxury vehicle. Put the rest of these funds in appreciation assets such as real estate money or index.

Learn more: 4 Secrets of the wealthy, according to Dave Ramsey

One of the wealthy Locenau clients had $ 5 million sitting in the normal savings account that gets 0.01 %. “This is mainly Loss of money to inflationNotice

After some convincing, he managed to make his client transfer most of it to a combination of High -yield savingsAnd bonds and arrows profits. Now, this money works more seriously and earns approximately 5 % to 7 %.

according to CNBCWhile the average return at the expense of traditional savings is only 0.43 %, some HYSAs offer prices more than 4 %. The best step, according to Locenau, is to maintain six months of expenses in providing the high return and investing the rest through various assets based on your goals and carrying risks.

“I have seen this strategy to reinforce the returns of wealthy customers with more than $ 100,000 annually,” he said.

There is a trend between the wealthy Lokenau clients to buy real estate without suitable research just because they can.

“I had a customer who dropped 3 million dollars in a holiday house he visited once,” he said in detail. “Between taxes, maintenance and missed investment opportunities, this decision cost him about $ 500,000.”

Lokenau suggested searching well before any property purchased. Calculate all costs (taxes, maintenance, insurance), as well as consider the leasing first.

successful Real estate investor customers Spend three to six months in analyzing each possible purchase, according to Lukot.

Lokenauth has seen rich clients spending crazy sums on the elements of designers who rarely use them.

He said: “One spent $ 50,000 per month on clothes with signs that they still have,” he said. “This money can generate a significant negative income instead.”

Lokenauth recommends wealthy clients to follow the base of 5 % – reduce luxury purchases to 5 % of your income. Customers have helped to redirect excess spending to investments, creating more than $ 20,000 per month in Negative income.

More gobinkins

This article was originally appeared on Gobankingheshes.com: I am a financial expert: 4 ridiculous money habits, the rich need to quit smoking