Myths and prejudices about money and investments (Part II)
Wealth is not the same as income. If one does a very good income each year and spends it all, you are not becoming richer. You are simply living a high standard of living. Wealth is what you accumulate, not what you spend.
MYTH ONE: INCOME vs. WEALTH. Therefore, to demystify first aspect of the rich is the bond that is usually done between income and wealth. They are two completely different concepts and it is very important that we see it that way.
How did the millionaires to become rich? Probably be thinking that the main source of wealth is the heritage or family tradition. But most of these millionaires are not descendants of Rockefeller. Over 80% of millionaires are ordinary people who accumulated wealth in one generation.
They did a slow, steady, without signing a multimillion-dollar contract with a football team or a record company without winning the lottery without actually becoming a character from the likes Madonna.
MYTH 2: THE 80% of millionaires are first-generation. Wealth is, in most cases, the result of a lifestyle that includes hard work, perseverance, planning and, more importantly, self-discipline.
As Benjamin Franklin (1706-1790), statesman and scientist: The way to wealth depends crucially on two words: work and savings.
While there has never been so much wealth in the United States as at present, most U.S. households are not rich. About half of the wealth of this country is owned by only 3.5% of households. That is, most households do not earn anything comes to wealth.
And these homes are not poor, but households of people with good incomes but can not accumulate wealth. To give a measure, there are more than 25 million households in the U.S. with annual incomes of $ 50,000 and there s more than 7 million households with incomes of $ s100.000 annually. Many of these households have accumulated wealth beyond his house and have no room to live without the monthly income of their salaries.
Despite that there are millions of homes with good annual income, are only 3.5 million households who are rich.
Why people with annual incomes themselves have different degrees of accumulation of wealth?
The decision to make with the money you earn is the key. Not only is it important to generate a good level of income but also know the correct use of that income.
The message is clear. Anyone can become rich. The key is whether this study and its conclusions are adapted to the reality of Argentina or not. I hear all your views and next week we demolishing more myths.