While many families believe that breaking the $100,000.00 threshold is a good benchmark for wealth when it comes to income. Then they reach that benchmark, their lifestyle expenses increase, and then that 100k doesn’t seem like so much money. So they shoot for the next benchmark and… guess what? Monthly expenditures go up and again it doesn’t feel like enough so basically, it becomes an ongoing cycle trying to break the next tier. The reality lays behind the behavior towards money management rather than the mentality of ever feeling there is enough of it. The cycle will always continue as long as the behavior towards money remains the same. The rat race continues with living the lifestyle of the rich mindset where money only generates from the time it takes to earn.
Would you rather be Rich or Wealthy?
Annette Bui | Updated April 26, 2020 | Lifestyle Mortgage Blog
Having the right money mindset takes you a long way to distinguish yourself from the Rich vs. the Wealthy attitude. Maintaining the appropriate mindset towards money has become truly popular and got a number of folks enthusiastic about why they give thought to it the best way possible. It got me considering that it will probably be will benefit you to discover this matter even further, and speak concerning the variations between a “Rich Mentality” and a “Wealthy Mentality”
There are significant distinctions between a rich vs a wealthy mindset when it comes to the following topics:
There are a number of variations between a wealthy mentality and a well to do mentality with regards to the under topics:
2. SAVINGS-Make your money work for you!
The way a person with a rich mindset looks at savings is quite different than that of one with a wealthy mindset. If you are someone who has a rich mindset, you likely have a large sum of money saved in a bank. I personally have done this myself! I used to be obsessed with the idea of having AT LEAST 6-9 months of living expenses in the bank at all times.
The problem with this is that the money sitting in the bank is not working for you, and is actually losing value due to inflation. The idea of not having your savings readily available in case of emergency is scary. Please understand that I’m not talking about emergency funds, or having some amount of cash handy. BUT, I am talking about investing any large sums you may have sitting in the bank into investments that can work for you!
3. EVERY DOLLAR HAS A JOB
Don’t just focus on the large purchases but also the everyday small buys from coffee at Starbucks or a frivolous lunchtime snack. These things all add up over time and eventually impact as much as an individual buy.
Most people reason that if the budget for the big-ticket items that that is okay to not worry about the little purchases. The reality is these expenses add up and they do so faster than you realize! Guess what those small purchases add up to? You guessed it- Big ones!! The reason this falls into a rich mentality is that I’m fortunate enough to not NEED to worry about spending 20 bucks on lunch out. But if I was coming from a wealthy mindset, I would anyway because every dollar spent on something small is actually a dollar that could be spent on something larger and more meaningful.
4.Create a Game Plan
They say we are 75% a reflection of the people we are surrounded by, so don’t stress about being in a learning curve or feel like you don’t belong if you find yourself amongst others that are at a different level of wealth you aspire towards. It is smarter to build relationships, with those who you can learn from and find a mentor. More often than not, people are delighted to share their stories. Engage in their "why" and found out what they advise they would give their younger selves.
The information provided herein has been prepared by a third party company and has been distributed for education purposes only. The positions, strategies, or opinions of the author do not necessarily represent the positions, strategies, or opinions of the company or its affiliates. Each loan is subject to underwriter final approval. All information, loan programs, interest rates, terms, and conditions are subject to change without notice. Always consult an accountant or tax advisor for full eligibility requirements on tax deduction.