Being RICH would invite health issues!
One of my recent meetings with a Young Manager in a
reputed company in Dubai was really a unique one. While we both were designing
the financial blue print, I asked him “So, you want to be rich?”
And to my surprise his answer was really unique that inspired
me to write this article today.
He replied “Being rich would invite health issues for me”
When I heard his answer I was
very relaxed as I could sense his financial literacy. That means, I need not
explain him about the financial planning in details as he was himself thorough.
And end of the day my job shall be smooth.
But still I asked what makes you say that “Being
rich would invite health issues for you”?
“You are in the financial industry so you
should know” he said.
“I normally do not get this kind of answers
from people” I replied.
And he started explaining me his point of view about money
and its usefulness.
“Many
people think that being rich and being wealthy is the same thing. But there is
a difference between the two: The rich may have lots of money but the wealthy never
worry about money. So I want to be
wealthy not rich.”
“True
Sir, I really appreciate your thoughts. These are few points to be noted while
thinking about creating an asset or saving money. Rich have lots of money; and they also have lots of expenses that keep them up at night.
Or they might have a high paying job but have do not have job security. The
wealthy, on the other hand, don’t have these worries.”
I said.
Wondering…Why? What’s the difference?
1) Wealth = Time
How many days/
months you can survive without physically working and still maintain your
standard of living?
For example,
your monthly expenses are $5,000 and you have $50,000 in savings, your wealth
is approximately 10 months or 300 days.
Wealth
is measured in time, not dollars.
2) It’s not what you earn
It’s not how much money you earn that matters
but how much money you save—and till how long that money may work for you. Will you able to take a
break from work?
3) How about a second Income?
Rich often
miss this concept as they are busy in creating long term assets like multiple
properties and involve in fire fighting (Home Loans, EMI and Debt). On the
other hand wealthy always look for assets which give immediate income or cash
inflows without risking their wealth. Now you have a choice full life to live.
4) Is Income a percentage game?
Of course yes,
each asset and individual has a value. It’s needless to say that an asset which
has features like easy to handle, zero maintenance or zero tax implications
would have higher percentage of return.
For example:
When someone holds a masters degree from a very reputed college the chances of
getting higher pay cheque is very high versus someone holding a masters degree
from a mediocre college.
When
you only own properties worth 1 million USD and earn $30,000 as rent, then its
only 3 % earning versus capital. On the other hand there would be ample
opportunity to earn more than 6% -7% with the same capital investment. This
concept may draw a thin line between rich and wealthy.
Many
people can become rich. But only financially intelligent people can become
wealthy—and that takes a strong financial education and proper mindset that allows you to build cash-flowing businesses and assets.
In the end what matters is peaceful sleep
and good health.
