Li Ka-Shing’s Wealth Formula for the Young (Episode 3)

wealth formula

Li Ka-Shing’s wealth formula seems really interesting. What is more important, it is meant for the young, especially those between 16 and 22 having their first job. According to the Forbes list of billionaires, Li Ka-Shing is the richest individual in Hong Kong.

Once he said, “I was facing life for the first time. I was 12 years old, but I felt like a 20-year-old. I knew then what life was.” This gives us ground to think that this man did not have an easy life. But as you can see, he managed to become a business magnate. Thus, a question arises; “What’s his wealth formula?” In fact, Li Ka-Shing does have a life-changing formula.

Living Expenses – 30%

According to the billionaire, young men and women can actually live on 30% of their income. This is not going to be easy, but it’s not impossible too. If you are living with your parents, then, most probably, this formula can work well for you. All you need to do is cut costs on food and clothes and try living in a more modest way. Li Ka-Shing says that when you are young, your body can actually endure such a lifestyle.

Building a strong network – 20%

This is what I call Asian wisdom. Li Ka-Shing offers to spend 20% of your income on building relationships. Note that the whole point here is in networking with people who you can learn from. Those 20% you can spend on inviting them to dinner (1-2 times a month). You can also volunteer for them by working overtime or for free. This way, you will get precious lessons and life experience that can be handy for your self-improvement.

Educating yourself – 15%

15% of your income should go on your education according to Li Ka-Shing’s wealth formula. As a matter of fact, you should invest in your education, gain more knowledge and skills, and improve yourself. Spend this 15% on books or to subscribe to online courses. You can try Coursera or edX.

Explore the world – 10%

The billionaire also advises setting some money aside to travel the world to see new places. By traveling, you do not only see places, you meet new cultures and people, and you get to know life better. Traveling helps to recharge and become more focused on your work. Since you are young, you can try different cost-effective traveling options. For example, you can stay in hostels or look for special offers and discounts from tour operators.

Save/Invest – 25%

Save or invest; this is a hard decision. But we have got an article on whether to save or invest money, read it before you decide where your 25% of income should go.

If you decide to save, you can get the Looma app. It will help you save money from your daily spendings. First, you need to set saving rules for different activities. Then the app will automatically save money every time you perform those activities like eating out, shopping, etc. You can get early access to the app by subscribing here.

As a Conclusion

The whole idea behind the wealth formula is about acting smartly while young to enjoy life when you grow older. Li Ka-Shing believes that people can design and plan their lives. And the better you plan your life, the higher your chances of success will be. Let us know what you think about this philosophical money saving formula. Do not forget to subscribe to get Looma.

 


Also published on Medium.

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