We all work for our money. Some of us work to accumulate money and build our net worth, some of us work to save our money for personal goals such as retirement or buying a home and some of us chose to work and spend our money to enjoy our lives each and every day.
If you are working to save your money how to you decide how much to save and how much money to spend each month? Some money experts feel that you should save between 10-20% of your pay check; however we know some personal finance bloggers who live comfortably on only 50% of their pay check. I guess how much money you decide to save each month depends on your financial priorities. If your main financial priority is to save money then you will live on less to save more money. However, if your main financial priority is to enjoy your life you will focus on spending your money and your secondary priority of saving money will take a back seat.
Are you saving money to build your net worth or are you saving for a specific goal? We always hear stories about how successful people have built fortunes from nothing; it’s the classic rags to riches story. If you are working to save money and you eventually build a personal fortune wouldn’t you cherish it forever? I know that I would. However the reality is that one bad business deal or one bad investment can wipe out a fortune that took an entire lifetime to build.
MSN recently published an article about successful business people who lost their fortunes. If you lost your fortune would you be able to recover? Maybe you would wallow in your loss or maybe you would start building your fortune all over again.
What would you do if you lost your fortune?
- David Siegel is a real estate mogul who at one time ran the most successful time share resort company in the world. However with the market crash in 2008 Siegel lost almost $300 million. Siegel chose not to wallow; he restructured his business and started to rebuild his empire. The Siegel Family story was made into a documentary.
- Robert L. Johnson is a television mogul who co-founded Black Entertainment Television with his wife Sheila. Media giant Viacom bought BET and made Johnson the first African-American billionaire. However after their divorce Johnson lost almost half of his billion dollar fortune.
- Barbara Davis was a wife who quickly lost both her husband and her fortune due to bad money management. After Davis’ husband passed away she decided to focus on philanthropically activities and left the fortune of Davis Petroleum to be managed by her children. The company’s fortune quickly dropped which also caused a rift amongst family members.
- Sanjiv Sidhu is a tech-genius who built his own company i2 Technologies at a rapidly fast rate. However with the tech burst in 2001 Sidhu lost $9 billion of his $10 billion fortune. Today i2 Technologies still exists but Sidhu only owns a mere $100 million in the company.
What have you learned from these million dollar mistakes? The morale of the story is trust the people in whose hands you put your money and don’t keep all of your eggs in one basket.
Photo by Maestro