Not everyone who is rich today was born that way. Many billionaires started out poor and are now very wealthy. But what makes the difference between poor vs. rich? What can each individual do? Does every person have the opportunity to determine that for themselves?
As a child, we first learn about the piggy bank from our parents and then later about the savings book. But what happens next? At school, we are taught next to nothing about this. Saving money is the right step at first. But what do we do with the savings? For example,
- Who do I talk to about money?
- What are my goals?
- What is the best way to make money?
- How do I save or invest money?
- What is a good investment?
- How do I behave with risky investments?
Poor vs. Rich – What do they do differently with their money?
The poor among us have so little money that they cannot save. Instead, they spend their money to cover their current expenses. These are for example: bills, rent, food, clothes and car. In addition, they usually have smaller loans for example cell phone or computer.
The situation is usually similar in the middle class. This group has more income, but there, too, it is not used properly. Instead of saving, they accumulate even more debt. In addition, living expenses are rising.
The rich among us do not work for their money. They make their money work for them. .
The following chart represents the money flow of two people in a simplified way. One is poor and the other is rich.
Poor vs. Rich – What can we learn from this?
If we want to become rich, we have to invest money. But how and where? First of all, it is important to understand that we need to save money. In doing so, you should act according to the following principle. “Pay yourself first!” It is necessary to understand that you
There is a saying “you can learn to save from rich people”. That’s true too! Germans spend a lot of money on cars, for example. It is a status symbol for many. But does it also make sense to own the newest car? In addition, we should ask ourselves whether we have to have a new cell phone every one or two years. Do I really need these new pants? Wealthy people think twice before they buy something. They are not guided by their feelings.
The more you save, the more you can invest. There are many tools for this purpose. For example, a budget book is suitable for saving. The classic method is writing on paper. In addition, there is software (Excel) for the computer or apps (
Poor vs. Rich – How do they work?
As mentioned above, the rich do not work for their money. They make money and others work for them. So to become very wealthy, we have to be good at investing money. In addition, most rich people are entrepreneurs. Employees help them make money. This begs the question. Does it make sense to work for someone else? You stay poor and the employer becomes rich.
I wouldn’t recommend rushing headlong into starting a company. Keep working at your job for now. Develop a business idea. Most companies are founded to solve problems. Think about what
There are also many ways to earn money on the web. Here you have the advantage that you usually do not need money to start. In addition, you can work from anywhere, be it cafe, beach, and so on.
Why we should not be guided by emotions?
Most people’s lives are controlled by two feelings. “Fear and desires or dreams”. This influences the way we work and invest money. We should not let ourselves be guided by emotions, but approach things logically.
We are guided by fear such as “money solves my problem”. This leads us to get up every morning with this fear. Then we go to work to pay the bills. We repeat this over and over again. The fear drives us to do this. The problem is that we hope to conquer the fear through this routine, but that is not true. Even if we earn more money, we would only spend more and find ourselves in the same vicious cycle.
It is totally normal to wish for something, be it more fun, or even something better or more beautiful. People need more money to fulfill these wishes. But the pleasure that money brings are often only short-lived. So pretty soon people need more money for more pleasure, more comfort, and more security. That’s why they keep working, thinking money will soothe their souls, which are plagued by fear and desire.
You need to recognize these feelings and use them to your advantage. Strengthen your focus and willpower through a
Poor vs. Rich – How do they invest money?
First of all, you need to understand the difference between a thing of value and a liability. One creates income and the other costs you money all the time. The rich acquire many valuables, while the poor usually acquire only liabilities. Once you understand the difference, focus on buying assets that create income. That is the best way to get wealthy.
You must learn to manage money. Don’t let others take money out of your pocket. Try to keep and invest your money as long as possible so that it can work for you. For the poor and middle class, their only source of income is their paycheck. Their livelihood is totally dependent on their employer. The rich do not depend on anyone. They generate their income from their investments.
The good thing about an investment is that it works 24 hours a day for you and your descendants. The families with money for several generations buy assets first and then pay with the interest, dividends or income their luxury.
Poor vs. Rich – Summary
In principle, it sounds quite simple, but we often make it difficult for ourselves again. The best thing to do is to start minimizing your expenses. Then reduce your liabilities and buy as many assets as you can. This is the first step to decide for yourself what you want to be. Poor and rich at the same time is not possible! In addition, you must always educate yourself in financial matters.
Finally, I wanted to share with you a few quotes from the following book:
- The rich do not work for money.
- If you want to be wealthy, you have to be financially literate.
- It’s not about how much money you make. It’s about how much money you keep.
- Don’t say, “I can’t afford it,” say, “How can I afford it?”
- Mind your own business!
Poor vs. Rich – Book Recommendation
Rich Dad Poor Dad: What the Rich Teach Their Kids About Money – Robert T. Kiyosaki
Why do the rich stay rich and the poor stay poor? Because the wealthy teach their children how to handle money and the others don’t! Most white-collar workers, in the course of their education, prefer to spend year after year in school and university, where they learn nothing about money, instead of becoming successful themselves.
Robert T. Kiyosaki had a “Rich Dad” and a “Poor Dad” in his youth. After heeding the former’s advice, he was able to retire at age 47. He had learned to make money work for him instead of the other way around. In Rich Dad Poor Dad, he shares his knowledge and shows how anyone can be successful.
GELVOS was created with the idea of how to implement “earn money without stress” and for this I would like to give you our experience again. All articles on this page are divided into these sections: make. save. invest. live. If you don’t want to miss anything, subscribe to our free newsletter and get a big step closer to your goals!