A few months ago I landed an assignment with a new business-to-business publication. It wanted me to write an article explaining how landscaping company owners can find new customers.
I interviewed three owners of small mom-and-pop landscape companies. All of them said — among other things — that they offer some type of discount to customers who send word-of-mouth referrals.
That’s straightforward enough, right?
I sent the draft article to my editor, including that detail. She sent it back with the following comment:
“People who hire landscapers are rich and don’t care about a discount.”
Her statement is so full of errors that I don’t know where to begin.
We’ll set aside the ridiculous comment that “people who hire landscapers are rich.” (Um, perhaps they’re busy juggling kids and a job? Perhaps they’re too elderly or sick to tend their own lawns? Perhaps they’re frequently out-of-town because of work or family?)
Instead, let’s look at the other assumption in her statement — the stereotype that rich people are spend-a-holics.
The Myth That Rich People Are Wasteful With Money
Perhaps television is to blame — The Real Housewives is just entertainment! It’s fiction! — but many people labor under the impression that being wealthy equals being wasteful.
I hear this stereotype constantly — “Oh, they’re rich. They don’t care about money” — and it blows my mind. Why do people believe that once a person’s net worth crosses a certain threshold, their skill at handling money slides into reverse?
I believe the opposite is true. People become rich by being skilled at money management. “The rich” start out as people like you and me: normal people who earn, save and invest.
We do it regularly. Lather, rinse, repeat. $100 grows to $110, then to $121. The interest compounds while add more to the principal. We buy real estate, start businesses, repay debt. We take calculated risks and we’re always looking for ways to earn more.
What about people who inherited their wealth?
The answer is simple: Heirs who steward and shepherd their family wealth will maintain and grow it. Heirs who squander their family wealth will lose it. One group will remain rich; the other group will not.
You Can’t Outsource Your Brain
I often hear the argument: “Rich people pay someone to take care of their money.” That’s about as sensible as saying, “Athletes pay someone to hit the 6-minute mile.”
Sure, the rich hire advisers, accountants and bookkeepers. They don’t do their own data-entry.
But like any company president, they’re responsible for hiring and firing their advisers and accountants. They’re the team leader. The buck stops with them.
You can’t pay someone else to take care of your money, any more than you can pay someone to take care of your health. You can hire nutrition counselors, Pilates instructors and swimming coaches, but you’re ultimately the CEO of your own health. You can hire financial planners and accountants, but you’re ultimately in charge of growing your own net worth.
Which brings me back to my original point — the stereotype that rich people are wasteful with money. That can’t be true. Rich people who are wasteful with money will become poor, just as thin people who eat nothing but deep-fried doughnuts will become fat.
In other words, the rich who — in the words of that editor — “don’t care about a discount” won’t be rich for much longer.
But the owners of the landscaping company who reinvest their earnings into more shovels, more mulch and more advertising will do just fine.