Why Some People Never Build Wealth
Building wealth is not just about how much one earns—it’s about how wisely one manages, saves, and grows that money. Yet, many people find themselves struggling to accumulate wealth over time. The Credit Suisse Global Wealth Report 2023 highlights this gap, noting that over 50% of adults globally hold less than 2% of total wealth, showing that wealth accumulation remains a challenge for most.
1. Lack of Financial Discipline
Spending beyond one’s means is a common trap. As N. R. Narayana Murthy , co-founder of Infosys, advises:
“Performance leads to recognition, recognition brings respect and respect enhances power. Humility and discipline consolidate power and wealth.” Without discipline in spending, saving, and investing, wealth slips away faster than it is earned.
2. Short-term Thinking
Many people focus on immediate pleasures at the cost of long-term goals. Lifestyle inflation, impulsive shopping, and chasing trends often derail financial stability. Rakesh Jhunjhunwala, the late investor known as India’s Big Bull, once reminded investors (during his lifetime):
“The market is about the future. You have to have patience, think long-term, and stay invested.” Those who constantly seek quick returns or instant gratification often miss out on the power of compounding.
3. Avoidance of Investing
Fear and hesitation stop many from growing their wealth through investments. According to an NSE India Investor Survey 2021, less than 10% of Indians invest in equities. Nikhil Kamath, co-founder of Zerodha, stresses the importance of starting:
“It is never about timing the market. It is about time in the market.” Avoiding investment opportunities means missing out on wealth generation.
4. Poor Risk Management
Wealth-building requires calculated risk-taking. Uday Kotak, MD of Kotak Mahindra Bank, has said:
“There is a thin line between courage and recklessness. You have to take risks, but they should be well understood and well-calculated.” Either avoiding all risks or taking uncalculated ones can block the path to wealth.
5. No Clear Plan or Purpose
Without setting financial goals or a roadmap, wealth building is like sailing without a destination. Kiran Mazumdar , executive chairperson of Biocon, rightly notes:
“Financial planning is as important as business planning. Both are essential for sustained growth.”
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