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The Definition of Wealth: What It Really Means To Be Wealthy
Buying Time
We all, rich or poor, have the same 24 hours in a day. But we can use our money to buy more time. For example, by eating out, you don't have to decide what to cook, shop for ingredients, cook, and clean it all up.
If you can carve out more time for yourself, you can use it in other ways that will improve your life. You can start a side hustle, exercise, read, or spend time with family and friends.
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SIMILAR ARTICLES & IDEAS:
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Key Ideas
Frugality
Frugality means resisting the temptation to spend more than you earn.
Discipline
Self-made millionaires choose moderation over extremes. They often buy used cars, don't live in the most expensive houses and don't try to time the investment market.
Hard Work
A defining characteristic of many millionaires are their willingness to work hard and stick it out in high-paying careers until they are financially independent.
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Key Ideas
The Definition of Rich
A high income and a regular acquisition of expensive stuff do not necessarily make people rich. People may have a high income, but many won’t survive three months if they are suddenly without their...
Wealthy People and Pseudo Affluence
Wealthy people have sustainable access to money, often for a very long period of time. Their habits are now aligned with the wealth that they have incurred.
Pseudo affluence, on the other hand, is what people experience when they are currently earning lots of money and start to believe that they are rich. They pay for their expensive lifestyle with a high amount of borrowed money and are just a job-loss away from being poor again.
Object Poor
... is a ‘state of excess’ when the stuff we own makes us poor, as the debt we incur has trapped us to keep working our jobs to fund the expensive lifestyle and habits.
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Key Ideas
How you can invest in yourself
The foundation for every personal pursuit in life is to invest in yourself. It can take years. How you can do it:
- Learn to build something. If you can create something valuable w...
Income generation
Once you have ideas, you want to put your ideas to work. If you do that, you can start creating value. When we create value, we generate income.
During the pandemic for example, most restaurant owners had to focus on other ideas to generate income. Building wealth is not easy. We need a constant supply of ideas.
Asset investing
It is anything that will increase your wealth without personal labor.
- Businesses. This is a broad asset class. You can buy dividend-stocks on the market, and then the companies will pay you a share of the profit. You can start your own business. You can buy into other private businesses.
- Bonds. When you invest in bonds, you collect interest just like your bank is collecting on a mortgage.
- Books. A good book will generate cash for a long time.
Assets that don't generate cash, but might increase in value.
- Land. A piece of land generates cash when you rent or lease it.
- Collectibles such as art or watches.