Life Lessons for Aspiring Millionaires

03/15/07 - 12:38 PM EDT

Scott Rothbort

Waste it now or have it later: I exploded when my daughter ran up over $100 in text messages to her friend. My wife and I cut her off from text messaging and made her pay for the text messages. She learned quickly. My kids wonder how their parents can own two houses or why we bought a boat last summer, yet I get in their face about wasting money. I explain to them in very simple terms as I have done here that you can decide -- waste it now or have it later.

When my kids receive their bar or bat mitzvah gift, we allow them one luxury item like a computer, and the rest gets invested. The bat mitzvah portfolios now have Apple(AAPL Quote - Cramer on AAPL - Stock Picks), Google (GOOG Quote - Cramer on GOOG - Stock Picks), McDonald's(MCD Quote - Cramer on MCD - Stock Picks) and Sears Holdings(SHLD Quote - Cramer on SHLD - Stock Picks). Goldman Sachs(GS Quote - Cramer on GS - Stock Picks) would be the next to be added.

So, if you want to take that road to becoming a millionaire, think about what you can do today to be one step closer to that goal. The decision between buying that new flat-panel TV or investing in a good mutual fund should be an easy one to make. In 25 years you will have either a nice money-making investment or memories of watching Deal or No Deal.

Key Points:

  • Becoming a millionaire requires a plan and long-term discipline.

  • Think twice before making short-term consumer decisions and weigh them against long-term investment opportunities -- you can't deposit memories into the bank.

  • Develop savings and investment habits early in life. Teach them to you children.

Some Homework:

  • Read The Millionaire Next Door by Stanley and Danko.

  • Perform a personal audit of your cash flows, income and expenses and balance sheet at least once a year. Tax time is an optimal point in the calendar to do so.

  • Look to turn expenses into savings.

  • Bring your children and grandchildren into the investing conversation.

To learn more about the topics in this article, click here to view Gregg Greenberg's video interview with Scott Rothbort.

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At the time of publication, Rothbort was long AAPL, EXC, GOOG, GS, MCD, PGN, SHLD, although positions can change at any time.

Scott Rothbort has over 20 years of experience in the financial services industry. In 2002, Rothbort founded LakeView Asset Management, LLC, a registered investment advisor based in Millburn, N.J., which offers customized individually managed separate accounts, including proprietary long/short strategies to its high net worth clientele.

Immediately prior to that, Rothbort worked at Merrill Lynch for 10 years, where he was instrumental in building the global equity derivative business and managed the global equity swap business from its inception. Rothbort previously held international assignments in Tokyo, Hong Kong and London while working for Morgan Stanley and County NatWest Securities.

Rothbort holds an MBA in finance and international business from the Stern School of Business of New York University and a BS in economics and accounting from the Wharton School of Business of the University of Pennsylvania. He is a Professor of Finance and the Chief Market Strategist for the Stillman School of Business of Seton Hall University.

For more information about Scott Rothbort and LakeView Asset Management, LLC, visit the company's Web site at www.lakeviewasset.com. Scott appreciates your feedback; click here to send him an email.

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