Rich vs Wealthy: What’s the Difference?
Rich vs Wealthy. Is there a difference? A friend shared with me an anecdote a long time ago. He said, “Rich people brag about how much they spend, and poor people brag about how much they saved.” I laughed in agreement, thinking he was right.
The word “wealthy” was just a fancier word for “rich.” In truth, many people think this way too.
Rich people may brag HOW MUCH they spend, but wealthy people share HOW they save!
What does it mean to be rich?
A person’s level of being rich is measured by how much they actively earn at their job. Rich simply means they make a lot of money by working in their full-time job.
It goes to show that being rich doesn’t necessarily equate to happiness when overwhelmed with debt.
What does it mean to be wealthy? A person’s wealth is not measured by how much they actively make (i.e., a full-time W2 job). Instead, their wealth is measured by how much time their money can buy them.
A person’s wealth is measured based on how long a person can live off their savings without actively working.
However, living off one’s savings without actively working does have a time limit. That is why wealthy people know to invest in assets, such as real estate, stocks, or royalties, creating passive income.
Absolute Income vs. Relative Income
Absolute income is a person’s income for a set period (i.e., a year), whereas relative income is a person’s income compared to their peers’ income and per time spent (i.e., per hour).
5 Steps to Become Wealthy
1. Create A Budget 2.Reduce Unnecessary Spending 3. Pay Off Personal and Student Debt 4. Build An Emergency Fund 5. Start Investing
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