5 Misconceptions About Wealth & “Making It”

As the CEO of Blue Lake Capital and someone who has navigated the intricacies of growing my own wealth, along with managing multimillion dollar real estate investments for our investors, I’ve encountered many misconceptions about what it means to be wealthy. Here, I want to share some insights to debunk these myths and offer a more grounded perspective on wealth.

Misconception #1: Lavish Lifestyle

Imagined: Constant extravagance and luxury spending.

Reality: Many people imagine that a wealthy lifestyle is all about constant luxury and extravagance. In reality, it's often about strategic financial planning and prioritizing long-term security over short-term indulgence. Personally, I focus on smart investments and diversifying my portfolio to ensure sustained growth. It’s about having the freedom to make thoughtful choices that secure my future, not just my present. For example, rather than spending on high-end jewelry, I prefer to reinvest profits back into promising real estate projects that will yield long-term returns.

Misconception #2: Free Time

Imagined: Unlimited leisure time and freedom from work.

Reality: The belief that wealth affords unlimited leisure time is a myth. Managing wealth is a demanding responsibility that requires significant time and effort. From overseeing investments to running Blue Lake Capital, my schedule is often packed. Real estate investing for me is a full-time job that demands constant attention and strategic planning. For instance, a typical day might involve back-to-back meetings, strategy sessions, and analyzing market trends. It’s a labor of love that requires dedication and commitment.

Misconception #3: Source of Happiness

Imagined: Money automatically brings happiness and solves all problems.

Reality: While financial stability can provide comfort and opportunities, it doesn't guarantee happiness. In my experience, true happiness stems from meaningful relationships, personal fulfillment, and a sense of purpose. Wealth can facilitate these aspects, but it cannot replace the intrinsic joy derived from them. I find joy in mentoring young entrepreneurs, spending quality time with my family, and giving back to the community through philanthropic efforts. These are the true sources of my happiness.

Misconception #4: Isolation

Imagined: UHNWIs (Ultra-High-Net-Worth Individuals) live in a world of exclusivity and detachment from others.

Reality: There’s a perception that ultra-high-net-worth individuals live isolated lives. However, strong relationships with family, friends, and trusted advisors are vital. These connections provide emotional support and essential guidance. No amount of wealth can substitute the value of these meaningful relationships. In my life, my relationships are the foundations that support everything else. Regular family dinners, being present for bath time for my daughter, and close collaboration with my investment committee keep me grounded and connected.

Misconception #5: Unprepared Heirs

Imagined: Children are automatically prepared to handle wealth.

Reality: It’s easy to assume that the children of wealthy individuals are inherently equipped to manage significant wealth. However, without proper financial literacy and education, they can quickly become overwhelmed. I believe in educating the next generation about financial responsibility and philanthropy to ensure they are prepared to handle and grow their inheritance responsibly. It’s about instilling values and knowledge that go beyond just financial literacy. In our family, we have regular discussions about budgeting, investing, and the importance of giving back, ensuring that we remind ourselves and model for our family that there are privileges and responsibilities that come with wealth.

Practical Tips for Readers

1. Prioritize Long-Term Security: Focus on investments that will provide long-term returns rather than short-term gains.

2. Stay Engaged: Managing wealth requires continuous learning and involvement. Stay informed about your investments and market trends.

3. Find Balance: While wealth can bring comfort, ensure you’re also investing in relationships and personal fulfillment.

4. Educate the Next Generation: Provide your children with the knowledge and tools they need to handle wealth responsibly.

5. Seek Professional Advice: Build a trusted team of advisors to help you navigate complex financial decisions.

Misconceptions About Wealth: Final Thoughts

Wealth comes with its own set of myths and realities. By understanding these misconceptions, we can better appreciate the responsibilities and challenges that accompany financial success. True wealth goes beyond the balance sheet; it encompasses security, relationships, and the wisdom to manage it all effectively.

P.S. If one of your priorities, like mine, is building and preserving your wealth through multifamily real estate investments, click here to download my new eBook: The Ultimate Guide to Creating & Preserving Your Wealth.

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About Ellie Perlman

Ellie Perlman is the founder of Blue Lake Capital, a commercial real estate investment firm specializing in multifamily investing throughout the United States. At Blue Lake Capital, Ellie partners with both institutional and individual investors to grow their wealth by achieving double-digit returns by investing alongside her in exclusive multifamily deals they usually don't have access to.

A defining factor of Blue Lake Capital’s strategy is founded in utilizing machine learning/artificial intelligence throughout the course of all acquisitions and asset management. This advanced technology enables the company to produce accurate and data-driven forecasting for all assets on a market, property, and even tenant basis. In doing so, Blue Lake is able to lead commercial investments with the full capabilities of today’s technology.

Ellie is the founding host of REady2Scale, a podcast that highlights the assets, processes, and strategies for the multiple approaches to successful real estate investing.

She started her career as a commercial real estate lawyer, leading real estate transactions for one of Israel’s leading development companies. Later, as a property manager for Israel’s largest energy company, she oversaw properties worth over $100MM. Additionally, Ellie is an experienced entrepreneur who helped build and scale companies by improving their business operations.

Ellie holds a Masters in Law from Bar-Ilan University in Israel and an MBA from MIT Sloan School of Management.

You can read more about Blue Lake Capital and Ellie Perlman at www.bluelake-capital.com.

*The content provided on this website, including all downloadable resources, is for informational purposes only and should not be interpreted as financial advice. Furthermore, this material does not constitute an offer to sell or a solicitation of an offer to buy any securities.